BP negotiating for stake in CNOOC unit

BP is negotiating to invest about $200 million in China National Offshore Oil Corp. unit CNOOC Ltd. when it launches an initial public offering next year, an official at China�s second biggest oil producer has said. Dai Huandong, CNOOC�s vice-president, said the amount has not yet been finalized. A BP spokesman declined comment on how much BP is willing to invest.


SINGAPORE�BP is negotiating to invest about $200 million in China National Offshore Oil Corp. unit CNOOC Ltd. when it launches an initial public offering next year, an official at China�s second biggest oil producer has said.

Dai Huandong, CNOOC�s vice-president, said the amount has not yet been finalized. A BP spokesman declined comment on how much BP is willing to invest.

CNOOC hopes to sell shares in Hong Kong and New York in February, according to Zhou Shouwei, executive director of CNOOC Ltd. It hopes to raise about $2.5 billion by selling a 25% stake in the company, analysts said.

BP, one of China�s largest investors, has spent more than $2.5 billion developing oil fields and building chemical plants in the world�s third largest energy market. BP had already invested about $1 billion in the stock of the country�s top two oil companies, Sinopec and Petrochina Co. Ltd.

Royal Dutch/Shell Group has also proposed a substantial investment when the IPO is launched. CNOOC said Shell would likely buy $200 million-$400 million in shares.

Foreign oil companies, such as Shell and BP, aim to expand their oil exploration business and product sales in China before the country�s entry into the World Trade Organization (WTO). China is expected to lower, if not scrap, trade barriers on oil products and chemicals after joining the WTO.

Hutchison Whampoa, Hongkong Electric Holdings, the Singapore Government Investment Corp, American International Group, American International Assurance, and CGU-CDC China Capital Partners have agreed to buy $470 million in shares.

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