China inks $10bn loan-for-oil deal with Brazil

26 May 2010 06:14  [Source: ICIS news]

SHANGHAI (ICIS news)--China Development Bank (CDB) will provide a $10bn (€8.1bn) loan to Brazil’s Petrobras in exchange for a supply of 10m tonnes/year of crude oil to China’s Sinopec over the next 10 years, a source from Sinopec said on Wednesday.

Under the loan agreement that was signed on 19 May, Sinopec will receive 10m tonnes of crude oil per annum from 2010 to 2019, which will account for 10% of Sinopec's total annual import volume. The move is expected to secure a resource for crude oil and meet rising domestic demand.

Earlier in 2009, China also had signed a $25bn loan with Russia for a supply of 15m tonnes/year of crude oil from Moscow over the next 20 years, according to a previous report from ICIS news.

Petrobras is one of the largest petroleum companies in South America, with net profit of $16.1bn in 2009.

The loan from CDB will be used mainly to fund the exploration of oilfields in southeast Brazil, according to a source from Petrobras.

China imported 211.7bn tonnes of crude oil in April, an increase of 30.91% year on year, according to data from China Customs.

($1 = €0.81)

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By: Dolly Wu
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