PetroChina buys shale gas stake
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E-mail Shanghai Daily, February 3, 2012
PetroChina Co has signed an agreement to buy a minority stake in a Canadian shale gas project from Royal Dutch Shell Plc, marking the latest effort by Chinese oil companies to tap the unconventional fossil fuel overseas.
China's biggest oil producer yesterday said it acquired 20 percent in Shell's wholly-owned Groundbirch project in British Columbia, but declined to give the value of the deal. Hong Kong-based news portal FinanceAsia, which first reported the deal, said the acquisition could be worth more than US$1 billion.
PetroChina and its domestic peers have invested in a number of shale projects in North America in the past year in a bid to gain critical know-how on extracting oil and gas from shale rock formations so that they can unlock similar resources at home. China is estimated to hold the world's largest shale gas deposit but commercial production has yet to start.
China Petrochemical Corp, Sinopec's parent, made its first foray into American shale by paying US$2.2 billion for a one-third stake in five emerging oilfields run by Devon Energy Corp, while CNOOC acquired stakes in several shale leases in Texas, Colorado and Wyoming in 2010 and 2011 from Chesapeake Energy Corp.
Gas output from the Groundbirch project is now 125 million cubic feet per day, according to PetroChina, which added it intends to gain experience by cooperating with Shell in the Canadian project.
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