CPC joins CNOOC to begin exploring

By Fu Chenghao  |   2008-12-27  |     NEWSPAPER EDITION

CHINA National Offshore Oil Corp has signed agreements with Taiwan-based CPC Corp to cooperate in overseas exploration and crude processing.

The deals, signed yesterday in Beijing by CNOOC General Manager Fu Chengyu and CPC Chairman Wenent Pan, marked improving links between the mainland's petroleum industry and that of Taiwan, a CNOOC statement said.

Under a letter of intent, the two companies will join in overseas oil and gas exploration, either by launching joint bids or transferring stakes to each other in international projects.

They also agreed to cooperate in the natural gas market and crude and refined oil trade as well as a technology sharing and training program, CNOOC said, adding CPC may process crude for it. CPC is mainly a refiner while CNOOC focuses on upstream exploration and production.

In one concrete deal, CNOOC yesterday agreed to transfer a 30-percent interest in a Kenyan exploration project to CPC, which is seeking more exposure in upstream business. After the transfer, CNOOC still owns 40 percent in Block 9 in northern Kenya and remains the operator, while Sweden's Lundin Petroleum AB holds the remaining 30 percent.

CNOOC and CPC also agreed to extend an agreement to hunt for oil and gas in a block offshore of southwestern Taiwan to the end of 2010 and to start a one-year geological data study on another area in Taiwan Strait near Fujian Province.

CNOOC's Fu said the two will continue to seek cooperation opportunities. They first cooperated in 1994.