China buys stake in RI

China buys stake in RI

BEIJING (Reuter): The China National Offshore Oil Corporation (CNOOC) said on Saturday it had bought a 32.58 percent stake in oilfields off Indonesia, becoming their biggest single shareholder.

CNOOC did not say how much it paid. A company statement said it was optimistic about returns and the oilfields in the Malacca Strait had "encouraging potential".

The purchase was CNOOC's first oil development overseas. It acquired the shares from the U.S. oil giant Atlantic Richfield Co, which had been the block's major shareholder in the past 10 years.

The contracted block covers an area of some 10,000 sq km (3,860 sq miles). It comprises 13 oilfields in operation, three that have indicated oil and gas reserves and 10 others seen as promising.

Oil produced will be sold overseas, said CNOOC.

The transfer of ownership took effect retroactively, on Jan. 1 this year, the statement said.

The deal, approved by both the Chinese government and Indonesia's national oil firm Pertamina, expires in the year 2000 but can be extended, it said.

The block's other partners are Oryx Energy Co and Kondur of the United States, Lasmo of Britain and Nippon of Japan, the China Daily newspaper said.