CNOOC ‘eyes’ stake in Ghana oilfield

October 13th, 2009 | China Daily

China National Offshore Oil Corp (CNOOC), the country’s leading offshore oil producer, is seeking to invest in a giant oilfield in Ghana to enhance its overseas development plans.

Beijing-based CNOOC is in talks with Ghana National Petroleum Corp to make a bid for a stake in the Jubilee oilfield, the Wall Street Journal reported, citing unnamed people.

This would rival ExxonMobil’s $4-billion offer for the field, which is located off the coast of Ghana, the report said.

A CNOOC spokesman yesterday declined to comment on the report. CNOOC President Fu Chengyu had earlier told China Daily that the company was taking a “patient approach” to overseas development.

The Jubilee field is said to hold 1.8 billion barrels of oil and would produce 120,000 barrels of crude a day. It is one of the largest oil discoveries in recent years and holds a type of light, sweet crude oil.

With nearby discoveries in Sierra Leone, the region in which Jubilee is located is emerging as a major new oil region and Ghana is expected to be an oil exporter by the end of next year.

CNOOC and ExxonMobil would both be vying for Kosmos Energy’s stake in Jubilee. Kosmos is a US oil explorer partly owned by Blackstone Group LP and Warburg Pincus LLC.

Fu earlier told reporters that the company would focus on “cooperation” to boost its overseas output.

“A cooperation with Ghana National Petroleum Corp would help CNOOC reduce risks in the deal,” said Han Xiaoping, a veteran energy analyst.

CNOOC is reportedly bidding for 6 billion barrels of oil, equivalent to one in six barrels of proven reserves in Nigeria, the second largest oil producer in Africa.

The overall value of the offer has not been disclosed, although some details suggest a figure of about $30 billion, the Financial Times reported.

The company’s potential bid came after Nigeria’s oil licenses were set for renewal. Global oil giants including Shell, Chevron, Total and ExxonMobil control or partially control 23 oil blocks in Nigeria, among which 16 licenses are set to expire.

CNOOC, together with China’s second largest oil company Sinopec, in July agreed to buy a stake in an Angolan oil block from US oil major Marathon Oil. The Chinese companies would form a 50-50 venture and pay $1.3 billion for a 20-percent stake in the highly prospective block, which has already yielded 12 discoveries.

According to a report by China National Petroleum Corp, State-owned companies had successfully made seven acquisitions of overseas oil and gas assets cumulatively worth 82 billion by September this year.

This represents an 80-percent increase compared with the same period last year, it said.

By Xiao Wan

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Category: Africa, China Oil Monitor