Sinopec to sell 30 % in Myanmar gas block to Taiwan's CPC
25 April 2013
China's Sinopec Group, Asia's largest petroleum refiner, will sell a 30-per cent stake in an onshore natural-gas block in Myanmar to Taiwan's CPC Corp, while China manages tensions with its neighbour.
This is the latest among a series of deals between China's state-owned energy giant and Taiwan's state-controlled oil and gas producer.
Sinopec gave no financial details of the transaction of Block D, which is awaiting approval from regulators, nor did it give any estimate of the reserves.
CPC, however, said three of the six exploratory wells drilled at the block to date have found potential gas.
Sinopec acquired full exploration rights to the 12,000 sq km block, near Myanmar's second-largest city of Mandalay, in 2004. The deal with Myanmar Oil and Gas Enterprise, however, is subject to Myanmar government's approval.
China, which acquired rights to the Myanmar gas block during Myanmar's military rule, is now facing a backlash from a quasi-civilian government, which resents China's arming and support to the former military government.
The new government in Myanmar has expressed opposition to a variety of large Chinese projects, including a pipeline that is slated to start carrying gas produced from the Bay of Bengal offshore Myanmar to Yunnan province in China.
Protests have forces the Chinese to suspend various other major projects, including a $3.6 billion Myitsone hydroelectric dam project in northern Myanmar, partly owned by China Power Investment Corp.
Sinopec had, in 2009, agreed to sell a 40 per cent stake in the NT/P76 block in Bonaparte basin, northern Australia, to CPC. The two companies own stakes in another block in Australia operated by Italy's Eni SpA (E).
CPC has also teamed up with China's Cnooc Ltd (CEO) for overseas energy assets.