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China oil firm buys EnCana assets in Ecuador
(Reuters)
Updated: 2005-09-15 07:13
EnCana Corp. is selling its oil assets in Ecuador to a Chinese consortium for
$1.42 billion in a deal it said reflects more its own plans to focus on North
America than the Andean country's political instability. Reuters reported.
Chinese employees
of China National Petroleum Corp. (CNPC) work at Tarim Oil Field, a branch
company of CNPC, in northwest China's Xinjiang Uygur autonomous region in
this October 10, 2004 file photo. [Reuters] | The
deal with a consortium led by Chinese giant CNPC leaves rival Indian bidder ONGC
out in the cold on a major deal for the second time in less than a month. The
two nations are locked in an intensifying battle for oil assets to fuel their
booming economies.
EnCana has been trying to sell the assets for more than a year, but was
holding out for a better price.
EnCana, North America's biggest independent oil explorer, said the price was
near the middle of its target range, and equal to the net book value of the
production and pipeline business.
In May, people familiar with talks told Reuters EnCana wanted $1.5 billion,
while bids were likely come in at about $1.2 billion from the CNPC grouping and
India's Oil and Natural Gas Corp. (ONGC). That was when crude oil was priced at
about $55 a barrel, some 13 percent below this week's levels above $63.
CNPC involved
The buyer is a group called Andes Petroleum, which includes
CNPC, the parent of PetroChina, the world's fifth-largest listed oil firm. In
August, CNPC beat ONGC to Canadian-based PetroKazakhstan, agreeing to acquire it
for $4.2 billion.
The CNPC consortium will acquire about 75,000 barrels a day of production
from five blocks and a 36 percent stake in the OCP pipeline, a new 450,000
barrel a day export line that EnCana spearheaded.
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