PetroChina sets aside $60 billion for overseas acquisitions
Chinese oil major PetroChina Co. plans to spend at least $60 billion in the next decade on overseas acquisitions in a bid to control oil and gas fields.
The move is in line with the company's plans to become an "international, integrated energy company", Chairman Jiang Jiemin told Bloomberg in an interview.
"A total investment of not less than $60 billion is needed to form our five regions of global oil and gas cooperation, by 2020," Jiang said, adding that the purchases will be funded using the company's cash flow and earnings.
PetroChina, which plans to produce 400 million metric tonnes (mt) of oil and gas annually by 2020, wants half of its oil and gas to come from abroad by 2020.
Currently, less than a tenth of its production comes from overseas.
However, Jiang added that the company will not be operating in "every oil-producing country".
"It"s not the more you eat, the better. You will suffer from indigestion if you eat too much," Jiang said.
Jiang said that parent company China National Petroleum Corp., which has been in talks with Russia on gas imports for more than a decade, has made "good progress" over the past two years with an initial pricing agreement signed at the end of 2009.
China plans to import 68 billion cubic metres of gas from Russia through two pipelines.
In addition, Jiang said Petrochina will focus on its oil and gas business and will not be investing in renewable energy including wind and solar for now.
The company spent almost $7 billion in the last year to buy refineries and reserves in Australia, Canada, Singapore and Central Asia.
In June 2009, it acquired a majority stake in Singapore Petroleum Company (SPC) from Keppel Corporation for S$1.47 billion ($1.02 billion) and subsequently exercise its rights to compulsarily acquire all of SPC's remaining shares at S$6.25 per share.