15 March 2010 06:30 [Source: ICIS news]
SHANGHAI (ICIS news)--China’s CNOOC Limited plans to establish a joint venture (JV) with Argentina’s Bridas Energy Holdings (BEH) at a cost of $3.1bn (€2.26bn) to grab a 50% stake in BEH’s subsidiary Bridas Corporation, Yang Hua, the president of CNOOC, said on Monday.
CNOOC Limited is China’s largest listed offshore oil and gas producer.
Bridas Corporation, currently a wholly owned subsidiary of BEH, could have its name changed after the completion of the transaction, CNOOC said.
The transaction, which still needs to get approval from Chinese government and regulatory bodies, was expected to be completed in the first half of 2010, Yang said in a conference call on the JV establishment.
Upon completion of the transaction, CNOOC Limited and BEH would each hold a 50% interest in Bridas, and would jointly make management decisions, he said.
Bridas, through its affiliates (including a 40% stake in Pan American Energy LLC), currently has oil and gas exploration and production activities in Argentina, Bolivia and Chile, he added.
"Bridas, with a world-class oil and gas asset portfolio, is a very good beachhead for us to enter Latin America. Through this transaction, we’ll establish a fair presence in this region, which will further enable the company’s production and reserve growth in the future," Yang said.
Based on relevant 2009 statistics and on a proportionate basis, it is expected that proven reserves and average daily production of the company will be increased by 318m barrels of oil equivalent (BOE) and 46,000 BOE respectively, upon completion of the transaction, CNOOC said.
"BEH is one of the foremost companies in Argentina and a pioneer in the oil and gas industry. This joint venture is aligned with our philosophy of seeking partnerships to expand our global footprints. I trust this investment will bring value to our shareholders, both in short term and long run," said Fu Chengyu, chairman and CEO of CNOOC.
($1 = €0.73)
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