CNOOC to take 12.5% stake in RI LNG project

CNOOC to take 12.5% stake in RI LNG project

Major Chinese oil firm CNOOC Ltd. said Friday it is to acquire a 12.5 percent stake in Indonesia's Tangguh liquefied natural gas project for about US$275 million. The company said the acquisition was part of an $8.5 billion deal signed Thursday with a consortium led by Britain's BP Plc. and Indonesia's Pertamina to supply LNG to China's Fujian province. The Hong Kong-listed CNOOC said in a statement it has entered into a heads of agreement to acquire a participating interest in the reserves and upstream production of Tangguh. The stake would be from BP through the acquisition of interests in production sharing contracts, it said. CNOOC said the planned acquisition would be "economically attractive and complementary to its natural gas strategy." "The acquisition of a material stake in the Tangguh joint venture and the reserves and upstream production would expand both the company's natural gas reserves and our upstream presence in Indonesia," CNOOC chairman Wei Liuchang said in the statement. "This proposed acquisition, together with our recently announced proposal to acquire an upstream interest in Australia's North West Shelf gas project, would be substantial step in executing our commitment to supplying natural gas to the rapidly growing market in China," he said. BP currently has a 50 percent share in the production sharing contract for Tangguh with Pertamina. The remaining 50 percent is held by Mitsubishi Corp, with 16 percent; Nippon Oil Exploration, 12 percent; British Gas, 11 percent; Kanematsu Corp, 10 percent; and LG Japan, 1.0 percent. -- AFP