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CNOOC completes stake purchase in US shale project
By Richard Fu |
November 17, 2010, Wednesday
|
Print Edition
Print Edition
CNOOC Ltd, China's top offshore energy firm, has completed a deal to buy a 33.3 percent stake in a United States oil and gas shale project.
This deal marks a victory for CNOOC in its first successful acquisition in the US after a failed bid to buy Unocal Corp in 2005.
Last month, CNOOC agreed to buy a one-third stake in the 243,000 hectares that Chesapeake Energy Corp leases in the Eagle Ford shale project in Texas for US$1.08 billion, plus an additional US$40 million payment adjustment at the conclusion of the deal. CNOOC also agreed to fund 75 percent of Chesapeake's share of drilling and completion costs of up to US$1.08 billion by the end of 2012.
Analysts have said the deal won't face US regulatory approval because CNOOC is buying a minority stake in one of many projects of a US energy company. Meanwhile, CNOOC's investment could help Chesapeake, which has a weak balance sheet, fully monetize its vast resources.
China National Offshore Oil Corp, the parent of listed CNOOC, began constructing a 8.3 billion yuan (US$1.25 billion) petrochemical project in Hainan on Sunday, Xinhua news agency said.
This deal marks a victory for CNOOC in its first successful acquisition in the US after a failed bid to buy Unocal Corp in 2005.
Last month, CNOOC agreed to buy a one-third stake in the 243,000 hectares that Chesapeake Energy Corp leases in the Eagle Ford shale project in Texas for US$1.08 billion, plus an additional US$40 million payment adjustment at the conclusion of the deal. CNOOC also agreed to fund 75 percent of Chesapeake's share of drilling and completion costs of up to US$1.08 billion by the end of 2012.
Analysts have said the deal won't face US regulatory approval because CNOOC is buying a minority stake in one of many projects of a US energy company. Meanwhile, CNOOC's investment could help Chesapeake, which has a weak balance sheet, fully monetize its vast resources.
China National Offshore Oil Corp, the parent of listed CNOOC, began constructing a 8.3 billion yuan (US$1.25 billion) petrochemical project in Hainan on Sunday, Xinhua news agency said.
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