China Offers Billions for Part Ownership Of U.S. Oil Fields
Oklahoma City, OKO, United States (AHN) – In what is considered to be the largest Chinese purchase of U.S. energy resources, the state-run China National Offshore Oil Corporation (CNOOC) has offered to pay $1.1 billion for a one-third share of a large Texas oil field owned by Oklahoma-based Chesapeake Energy Corp.
According to both companies’ public statements, CNOOC plans to buy 33.3 percent of Chesapeake’s lease of 600,000 acres of oil and gas fields in the Eagle Ford shale project in Texas.
CNOOC will also pay $1.08 billion to shoulder and expand Chesapeake’s drilling costs.
With the additional capital, Chesapeake’s 10 wells in Eagle Ford will now increase to 40 rigs by the end of 2012. Chesapeake also said the project will reach peak production of 400,000 to 500,000 barrels of oil a day in the next decade.
China’s one-third ownership of the Eagle Ford project is considered the biggest acquisition of a U.S. oil and gas asset by a Chinese company.
The International Energy Agency reported earlier this year that China now uses more energy than any other country, including the United States.
The deal is expected to be finalized before the end of the year.
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