CNPC Said Near Buying Petrobras Assets for Over $2 Billion

BEIJING. October 29. KAZINFORM China National Petroleum Corp., the country's largest oil producer, is nearing an agreement to buy Petroleo Brasileiro SA's assets in Peru for more than $2 billion, said three people with knowledge of the matter.

The proposed deal may be announced as soon as next month, said one of the people, who asked not to be identified because the talks are private.

The China National Petroleum Corp. headquarters stands in Beijing. Photographer: Tomohiro Ohsumi/Bloomberg
Petrobras, the most indebted publicly traded oil company, has been selling assets to help finance projects in Brazil's deep waters. The company, controlled by Brazil's government, agreed to sell oil blocks and pipelines in Colombia to Perenco UK Ltd. for $380 million last month.

CNPC is the most acquisitive Asian energy company this year, according to data compiled by Bloomberg.
Li Runsheng, a CNPC spokesman in Beijing, didn't answer calls to his office. A call and an e-mail to Petrobras (PETR4) in Rio de Janeiro outside of regular business hours went unanswered.

Petrobras entered Peru in 1996, according to its website. It produces about 16,000 barrels a day in the country and holds stakes in exploration assets in the Maranon, Huallaga and Madre de Dios basins, the website shows.
The Brazilian producer, which last week reported a 40 percent drop in third-quarter profit, is seeking to finance plans to spend $237 billion to build refineries and develop deepwater fields in the five years through 2017. Petrobras took a 40 percent stake in the Libra field, the largest discovery in Brazil's history, in a government auction on Oct. 21.

Subsea Prospects

Libra is the first auction of subsea prospects known as pre-salt using a production-sharing model. The consortium that won a 35-year concession for the Libra field also includes Royal Dutch Shell Plc (RDSA) and Total SA, each gaining a 20 percent stake. CNPC and Beijing-based Cnooc Ltd. also have 10 percent apiece.

State-owned CNPC said in March it would spend $4.2 billion to buy a stake in Eni SpA (ENI)'s natural gas assets in Mozambique. The Beijing-based producer agreed in September to pay about $5 billion to purchase a stake in the Kashagan oil project from state-backed KazMunaiGaz National Co. in Kazakhstan.

To contact the reporters on this story: Zijing Wu in Hong Kong at [email protected]; Cristiane Lucchesi in Sao Paulo at [email protected]; Rodrigo Orihuela in Rio de Janeiro at [email protected]
To contact the editor responsible for this story: Philip Lagerkranser at [email protected]

Source: BLOOMBERG