Talks not begun on Repsol arm buy, CNPC says

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(China Daily)
Updated: 2009-10-23 11:49

China National Petroleum Corp (CNPC) hasn't started formal talks with Repsol YPF SA on acquiring a stake in the Spanish company's Argentine unit, Bloomberg reported yesterday, citing a company official.

CNPC is not at that stage yet, Wang Dongjin, vice-president of CNPC told reporters at a conference in Beijing yesterday, Bloomberg reported.

Repsol, Spain's largest oil company, is maintaining a plan to cut exposure to Argentina and its "preferred" means to do that is through a public offering of a stake in its YPF unit, spokesman Kristian Rix said in a telephone interview this month.

While the Madrid-based company was pursuing talks to sell a stake in the unit to CNPC, it hasn't received any formal offers, two people familiar with the matter said in August.

CNPC had proposed offering $13 billion to $14.5 billion for a controlling stake in the YPF SA unit, three people familiar with the matter said in July.

This year State-owned companies have successfully made seven acquisitions of overseas oil and gas assets cumulatively worth 82 billion yuan ($12.01 billion), CNPC said in an earlier report.

This represents an 80-percent increase compared with the same period last year, it said.

Of the deals, the largest was China's second largest oil company Sinopec Group's $7.51-billion takeover of Geneva-based oil and gas producer Addax Petroleum Corp. This is currently the largest overseas takeover by a single Chinese company.

Domestic companies have paid increasing attention to regions such as the Middle East, Africa and South America while scouting for overseas assets, Andy Brogan, global oil and gas transaction advisory leader at Ernst & Young told China Daily in an interview.

China's sound relations with countries in the regions may help domestic companies succeed in making deals in the area, he added.

According to a recent report by the Chinese Academy of Social Sciences, 64.5 percent of the country's oil consumption is likely to be met by imports in 2020.

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