Asia/Pacific News
Brightoil to Buy Anadarko Petroleum's China Upstream Assets for $1.1B
Brightoil Petroleum [HKG:0933] (Brightoil) has reached a deal with U.S. oil firm Anadarko Petroleum to buy its China business for $1.08 billion, Reuters reports.
The deal, which includes shares of two Bohai Bay oilfields, is part of Brightoil's efforts to increase its upstream activities after international economic problems hurt its oil trading and bunkering businesses in recent years.
"The acquisition is an important step towards the implementation of the group's strategy to expand the upstream business … to develop progressively into an integrated petroleum [and] gas company," Brightoil said in a statement, the South China Morning Post reports.
The assets include a 40.09 percent state in one oilfield, 29.17 percent of another, and 50 percent interest in an exploration project
The output of the two mature fields was 11.7 million barrels last year, down 23.7 percent from the previous year.
The deal is now waiting on approval from the Ministry of Commerce and financing by Brightoil.
Brightoil's shares rose 26 percent to close at HK2.80 ($0.36) Tuesday, but some analysts warned the value of the assets may not be high enough to justify the price, based on production figure.
"At the first glance, it does not look like a bargain to me," said Simon Powell, head of Asia oil and gas research at CLSA in Hong Kong.
