China to look abroad for natural resources
0 Comment(s)
Print
E-mail Shanghai Daily, July 25, 2012
China will "proactively" seek investments in natural resources overseas to secure long-term energy and mineral supplies, according to a government plan released Wednesday.
The government will provide guidance for such investments and help establish an evaluation system to reduce risks for exploration projects, the National Development and Reform Commission said in a five-year (2011-2015) plan regarding overseas investment by Chinese companies and foreign investment in China.
The country will also encourages investment in cross-border pipelines to help diversify sources of energy imports.
The plan came just one day after CNOOC Ltd, China's largest offshore oil and gas producer, said it will pay US$15.1 billion for Canada-based Nexen Inc in what would be China's largest overseas acquisition.
Also on Monday, Sinopec Group, China's largest refiner, said it agreed to pay US$1.5 billion for a 49 percent stake in Talisman Energy Inc's UK unit.
Chinese national oil firms have emerged as major players in global M&A deals since the 2008/09 global financial crisis, which represented a once in 100 years opportunity for Chinese companies to take advantage of lower asset prices and reduced competition.
"Overseas mergers and acquisitions will continue to grow strongly as Chinese oil majors plan to double overseas production over the next five years," said Neil Beveridge, analyst at Sanford C. Bernstein.
Go to Forum >>0 Comment(s)