“China Petrochemical Corp., the nation’s second-largest energy company, will pay $1.02 billion to buy 50 percent of Chesapeake Energy Corp. (CHK)’s Mississippi Lime assets, seeking to benefit from surging U.S. crude output.
The assets in Oklahoma produced 46,000 barrels of oil a day at the end of 2012, according to an e-mailed statement released today by Beijing-based unit Sinopec International Petroleum Exploration & Production Corp. Cnooc Ltd. (883), a unit of China’s largest offshore oil producer, has bought $1.65 billion of assets from Chesapeake since 2010.
U.S. energy acquisitions may soar after Cnooc this month won approval from the U.S. Committee on Foreign Investment to buy Nexen Inc. (NXY) for $15.1 billion. Chinese companies are seeking energy assets globally to lock in supplies for the world’s fastest growing major economy and access technology to retrieve fuel trapped in rocks that has driven U.S. oil production to the highest in almost 21 years.
“While Chesapeake has many quality assets, Chinese oil companies care more about their drilling and shale-fracking technology,” Laban Yu, Hong Kong-based analyst at Jefferies Group Inc., said in a telephone interview. “The reason Chinese oil companies have gone after Chesapeake in the past year was also because they wanted to apply the technology to tap the world’s No.1 shale gas reserves in China.”