Huge Potential for Shale Gas in China

According to the US Energy Information Administration, China holds the largest reserves of shale gas in the world, enough to supply China for more than 300 years. There’s no current commercial production of shale gas in China, but several companies have exploratory projects underway, including Sinopec, PetroChina, Royal Dutch Shell, BP and Chevron. Continue reading here..

Has Centrica Bagged a Discount Bargain in Statfjord??

In the deal announced today, Centrica has acquired Reserves estimated at 36 MMBOE for a consideration of $223 million, which yield an effective $/2P BOE of $6.19. This metric is approximately 20% lower than the one seen in the Centrica – Shell deal of Sep-2010 at $7.85 ($225 million for 28.67 MMBOE). Continue reading here..

Sinopec and Petrobras collaborate to develop offshore Brazilian blocks!! Petrobras plans $224 billion investment through 2014.

Sinopec will team up with Petrobras to develop offshore areas of the Para-Maranhao basin in northern Brazil after negotiating for a year. Petrobras is planning to invest $224 billion in the five years through 2014, the largest spending plan of any oil company, to increase oil and gasoline output. “Petrobras is seeking international partners because as its production is expected to double in the next 10 years to reach 4 million barrels per day", said Petrobras’ CEO Gabrielli. He said Petrobras' strategic planning foresees the order of 169 platforms, 504 support vessels, 53 drills and 48 oil tankers until 2020.

Source: Global E&P Transactions 2010 Review

In 2010, Petrobras announced a preliminary agreement to sell stakes in two blocks, BM-PAMA-3 and BM-PAMA-4, to Sinopec. Last October, Sinopec made an entry into Brazil by acquiring 40% interest in Repsol’s Brazilian business for $7.1 billion. “Sinopec is keen to expand its overseas oil and natural-gas operations”, said Sinopec President Wang Tianpu. The keenness is justified by the following snapshot.

Source: Derrick Petroleum E&P Transactions Database

South America- the new playground for Chinese!!

The 2010 M&A activity in South America took a gigantic step by clinching deals worth $36.1 billion, a 91% increase from 2009 value of $3.2 billion. South America accounted for 17% of the total 2010 M&A value of $211 billion and was ranked the second largest region globally for the M&A activity. Brazil was the top country with several large sized transactions totalling $16 billion. 10 transactions were recorded above $1 billion, with Chinese oil and gas companies involved in five of these worth $23 billion in total.

Brazil needs fund and China needs oil & gas resources to meet the growing demand. Here ends the story - Robust Collaboration between Sinopec and Petrobras. Expecting an even more aggressive activity from South America in 2011!

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Sinopec reports 2010 annual results; Natural Gas Production up 47.6% over 2009; Plan to invest RMB 54,100 million (US$ 8,300 million) for exploration and development of mature oil fields in eastern China, Tahe, Angola Block 18, and gas fields in Yuanba.

Sinopec produced 441.4 bcf of gas in 2010, up 47.6% over the 2009 gas production of 299 bcf. This is due to the start of commercial production from the Puguang gas field in Sichuan province. The capital expenditure for exploration and production segment was RMB 52,680 million (US$ 8,018 million), which was mainly used for exploration, development and capacity construction of key oilfields including Tahe, Shengli and Angola Block 18 and gas fields in Puguang and Erdos, as well as for pipeline construction of the Sichuan-to-Eastern China Gas Project

In 2011, Sinopec plans to produce 45.59 million tons of crude oil and 14.1 bcm of natural gas. The company has also estimated a set of operational targets as part of 12^th five year plan, which include domestic crude production of 43.5 to 45 mt/y; gas production of 20 to 24 bcm/year.

Capital expenditure for 2011 is projected to be around RMB 124.1 billion, primarily for E&P projects, Shandong LNG project, Changling and Beihai refinery revamping and upgrading, as well the construction and upgrading of new service stations, Wuhan ethylene and Zhongyuan coal-to-olefin projects, crude and product pipeline projects and logistics system.

To know more about Sinopec Corp., visit:http://docsearch.derrickpetroleum.com/research/cmp/508/Sinopec%20Corp%20(China%20Petroleum).html