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CNOOC buys Bridas stake for $3.1b

(Agencies)
Updated: 2010-03-15 11:02

Overseas expansion

"CNOOC will have to expand overseas production through acquisitions because its domestic fields are unlikely to be able to help the company reach its output goals for this year," said Qiu Xiaofeng, an oil analyst at China Merchants Securities Ltd.

China relied on imports for more than half its crude oil needs last year, with monthly shipments reaching a record 20.9 million tons in December. The country may post a new all-time high for crude imports this year as a resurgent economy drives fuel-demand growth, an estimate from China National Petroleum Corp showed on Feb 4.

Bulgheroni has dual Argentine and Italian nationality and resides in Madrid, according to the website of the Center for Strategic & International Studies, of which he is a trustee. In addition to being president of Bridas, he is president of Energy Developments and Investments Corporation, which explores for oil and gas in North Africa, Russia, Central Asia and the Middle East, according to the Washington, DC-based CSIS.

San Jorge Basin

About 94 percent of Pan American's total crude production comes from Argentina's San Jorge basin, straddling the remote Patagonian provinces of Chubut and Santa Cruz. The basin is home to Cerro Dragon, Argentina's most productive field. Pan American produces about 17 percent of the nation's crude and about 15 percent of its gas, according to the company's website.

PetroChina Co in December won approval from the Canadian government to buy a stake in two Alberta oil-sands projects for C$1.9 billion ($1.86 billion). China Petrochemical Corp completed its C$8.3 billion acquisition of Addax Petroleum Corp in August.

YPF was also named last year as a possible takeover target for China National Petroleum Corp, the parent of PetroChina. Repsol, based in Madrid, is seeking to reduce its stake in the unit to fund expansion elsewhere, such as in Brazil's offshore pre-salt fields, home to the largest oil discovery in the Western Hemisphere since Mexico's Cantarell in 1976.

Robert Wine, a London-based spokesman for BP, declined to comment on CNOOC's planned investment in Bridas and Pan American Energy. The UK company last week agreed to pay Devon Energy $7 billion for assets in Brazil, the Gulf of Mexico and Azerbaijan.

JPMorgan Chase & Co advised CNOOC on the proposed purchase.