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Experts: Oil firms' overseas acquisitions not gov't behavior

By Zhang Jiawei (chinadaily.com.cn)
Updated: 2009-11-03 17:25

A major Chinese oil corporation says the latest string of overseas acquisitions by Chinese-based enterprises is motivated by financial reasons, and not by any pressure from the government, as is being suspected by some foreign media.

The Shanghai Securities News quotes Shan Lianwen, director of corporate strategy at China National Offshore Oil Corporation, China's third-largest oil producer, as saying the enterprises are acting entirely on their own behalf.

Shan's remarks came as China's three oil giants -- China National Petroleum Corporation (CNPC), China Petrochemical Corporation (Sinopec) and China National Offshore Oil Corporation (CNOOC) -- put themselves in the international spotlight with a series of acquisitions around the world.

"China's oil firms' overseas acquisitions are beneficial to the country's energy safety but that is not the main aim," Shan said, adding that their ultimate goal is to make money while working strategically to keep up with globalization.

The insurance of China's oil safety comes last on their list of priorities, Shan said.

Li Junfeng, deputy director of the Energy Research institute under the National Development and Reform Commission, echoed Shan's remarks and said China's three oil giants are all market-oriented despite being State-owned.

The investments made by the three oil giants are purely initiatives of the enterprises rather than the government's, Li was quoted by the newspaper as saying.

Several eye-catching acquisitions have been made by China's three oil giants since the beginning of this year, including Sinopec's $7.24 billion takeover of Geneva-based oil and gas producer Addax Petroleum Corp; the $41 billion liquefied natural gas deal between Exxon Mobil and PetroChina (whose parent is CNPC), which brought PetroChina's total liquefied natural gas purchase from the project to a total of 3.25 million tons per annum for 20 years; and Sinopec and CNOOC's joint purchase of a 20 percent stake in Angola's offshore deepwater Block 32 for $1.3 billion from Marathon Oil Corp.