BEIJING, Jan. 10 -- China's largest gas and oil producer CNOOC said it had agreed to buy a 45 percent stake in an oil block off the coast of Nigeria for almost 2.3 billion dollars.

A woman walks past the headquarters of the state-run energy firm China National Offshore Oil Corporation (CNOOC) in Beijing, in June 2005. China's largest gas and oil producer CNOOC said it had agreed to buy a 45 percent stake in an oil block off the coast of Nigeria for almost 2.3 billion dollars. [AFP]

    The Hong Kong-listed unit of the China National Overseas Oil Corporation said it had signed a firm agreement with Nigeria's South Atlantic Petroleum to acquire the stake in the OML 130 block in the Niger Delta.

    The purchase would be funded from internal resources, a CNOOC statement said.

    "The purchase of this interest in OML 130 helps CNOOC gain access to an oil and gas field of huge interest and upside potential, located in one of the world's largest oil and gas basins," CNOOC chairman Fu Chengyu said Monday.

    "With one of the leading deep water experts as the operator of the field, we have every confidence for the fast and efficient production of oil."

    The block covers about 500 square miles (1,300 sq km) and water depths range from about 1,100 to 1,800 meters (3,630-5,940 feet). It is being operated by French oil giant Total.

    Total estimates the block could contain some 600 million barrels of recoverable oil with a potential for some 500 million more barrels, the statement said.

    The field is due to come into production in 2008. The transaction is expected to be finalised in the first half of this year and is conditional on approval from the Nigerian National Petroleum Corporation and the Chinese government.

    The deal is China's latest attempt to acquire foreign oil to fuel its booming economy.

    China recently became the world's second-largest oil consumer after the United States. In 2004 it consumed 314 million tonnes, of which it imported 122.7 million, taking eight percent of world consumption.

    Last year CNOOC's bid to buy the US energy company Unocal Corp lost out to the Chevron Corporation after a politically charged controversy in the United States over a Chinese company taking over US energy assets.

    CNOOC has said previously it was in talks for a stake in Australia's Gorgon gas projects, while also expressing interest in acquiring 10 billion dollars of assets in dismembered Russian oil group Yukos.

    Several months ago China National Petroleum Corporation paid 4.18 billion dollars for the Canadian-listed company PetroKazakhstan which exploits oil fields in the Central Asian country that borders China.

    In expectations of the deal, China and Kazakhstan have built an 806 million dollar pipeline that spans some 1,000 kilometers (600 miles) from the oil fields to refineries in China's Xinjiang region.

    CNOOC's Hong Kong-listed Chinese oil group reported third-quarter total revenues of 14.87 billion yuan (1.82 billion dollars) compared with 11.4 billion yuan a year earlier.

    Oil and gas sales rose 31.2 percent during the period to 14.76 billion yuan.Enditem

(Source: China Daily/AFP)