USD 66.6082

+0.61

EUR 73.9484

+0.73

BRENT 59.76

-0.01

AI-92 42.23

+0.04

AI-95 45.97

+0.02

AI-98 51.74

0

Diesel 45.89

+0.11

37

China National Petroleum Corporation poised to snap up oil bargains using $30bn state loan

China National Petroleum Corporation, the huge Beijing energy group, has been granted a $30 billion (Ј18 billion) state-backed loan to fund …


China National Petroleum Corporation, the huge Beijing energy group, has been granted a $30 billion (Ј18 billion) state-backed loan to fund an audacious global acquisition binge.

Analysts said that the cash injection could help the company to finance some of the biggest overseas takeovers attempted by Chinese companies. The acquisitions are expected to focus heavily on Latin America, Canada and countries where the oilfields are immature or untapped.

The company is among a number of Chinese oil and gas groups scrambling to exploit depressed commodity prices and takeover opportunities emerging from the rubble of the financial crisis.

Sinopec succeeded in a $7 billion move on Canada’ s Addax in June and the pace of dealmaking is expected to rise quickly from now. Beijing wants its oil groups to become global players, and oil industry sources say it sees the next 12 months as perhaps the best buying window that it will ever get.Crude oil now trades at 50 per cent below its $147 per barrel peak last year and many exploration projects around the world have been hamstrung by difficulties in securing credit.
CNPC is the parent of PetroChina, which has made deals worth Ј4 billion since the spring in its pursuit of viable oilfields and refineries. Those include controlling stakes in two Canadian tar sands projects and the purchase in May of Singapore Petroleum.

A statement from Jiang Jiemin, CNPC’ s president, indicated an overseas buying spree would be pursued in China’ s broad national interest. “ The credit agreement is of great importance for CNPC to speed up its overseas expansion strategy and secure the nation’ s energy supplies,” he said.

It recently emerged that CNPC was in talks with Repsol for a controlling stake in the Spanish group’ s Argentinian operations. Talks are thought to have focused on a price of $13 billion to $14.5 billion, which would make it China’ s biggest overseas takeover.

Splashing out

PetroChina’ s buying spree since May:

• Bought Singapore Petroleum for $2.2bn.

• Bought a gas reserve in Turkmenistan for $1.19bn.

• Bought refining assets for 11.07bn yuan (Ј979m).

• Bought 60 per cent of oil sands projects for C$1.9bn (Ј1.1 bn).

Source : timesonline