CHINA National Petroleum Corp has agreed to buy a 28.57 percent stake in Italian oil company Eni SpA's East African unit for US$4.2 billion to access gas assets in Mozambique.
CNPC, parent of PetroChina Co, will indirectly hold a 20 percent interest in the Area 4 block in the Rovuma Basin, CNPC said in a statement yesterday. Analysts said the price is in line with market expectations.
"It continues the string of investment by CNPC/PetroChina in LNG projects with Browse, Poseidon and British Columbia and highlights the company's focus in building a global portfolio of LNG, backed by strong Chinese demand for LNG going forward," Sanford C. Bernstein & Co said in a report.
Eni was looking for investors to share the cost of development and plans to build facilities to turn the gas into LNG to ship the fuel to Asia.
"CNPC's entry into Area 4 is strategically important for the project thanks to the worldwide relevance of the new partner in the upstream and downstream sectors," Eni said.
Eni's holding in the project will fall to 50 percent on completion of the deal, which is subject to regulatory approval from Mozambique.
Mozambique's national oil company ENH, Korea Gas Corp and Portugal's Galp Energia each owns 10 percent of the project, which holds 75 trillion cubic feet of gas. That's almost four years' equivalent of total European gas demand.
CNPC has also agreed with Eni to jointly develop shale gas in the Rongchang block in China's Sichuan Basin.
What house can you buy with 1 million yuan in China?
Feedback
RSS
