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Oil Producer Says It's Not About to Buy
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China's biggest offshore oil producer, China National Offshore Oil Corp Limited (CNOOC), has denied rumors that it is in major talks about taking over foreign oil reserves.


In a statement to the Hong Kong Stock Exchange, where it is listed, the firm said it is not involved in any talks about acquisitions that require disclosure to the stock market.


It said it did not know of any reason why its shares yesterday increased by 5.5 percent, CNOOC said in a statement to the stock exchange. That share price gain was the biggest in six months.


"Save for the company's announcement dated January 9 that it acquired an interest in offshore Nigeria oil field OML (oil mining licence) 130, the board is not aware of any reasons for such an increase," CNOOC said in the statement.


The company last month said it would pay US$2.3 billion for a 45 percent interest in the Nigerian oilfield. Shares in CNOOC leapt 3.7 percent the day after the company made the acquisition announcement.


"The board confirms that there are no negotiations or agreements relating to intended acquisitions or realizations that need to be disclosed. And neither is the board aware of any matter that requires disclosure that is, or may be, price sensitive," the oil producer added.


Hou Jixiong, a senior oil analyst with Guotai Jun'an Securities Co Ltd, said it was not surprising to see an increase in CNOOC's share price, since foreign investors have shown an interest in all the country's State-owned oil majors.


Shares of CNOOC rose 0.7 percent yesterday to HK$6.8 (87 US cents) on the Hong Kong Stock Exchange.


Rumors earlier suggested CNOOC might bid US$2 billion for Calgary-based Nations Energy Co, whose main asset is an oil field in Kazakhstan.


Nations Energy produces more than 50,000 barrels of oil a day, mostly from Kazakhstan's Karazhanbas field, according to the company's website.


CNOOC at the end of last month announced that its net production volume this year will reach approximately 168-170 million barrels of oil equivalent (boe).


That will represent an increase of nearly 9 per centover 2005. Net production from China's offshore fields is estimated to be 148 million to 149 million boe this year, while the company's overseas output is expected to reach 20-21 million boe.


Ten projects offshore are expected start operation this year, the firm said.


(China Daily February 8, 2006)


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