China's CNPC buys stake in Shell's Syria unit

BEIJING: China National Petroleum Corp, the country's top oil producer, said on Wednesday it had acquired part of a Shell subsidiary in Syria, the latest move in its global quest to secure energy resources.

The deal gives CNPC a 35 per cent stake in Syria Shell Petroleum Development (SSPD), which was wholly owned by Royal Dutch Shell, the Chinese company said in a statement.

China has been aggressively securing overseas oil production contracts as it seeks to meet soaring energy demand at home.

SSPD has interests in three production licences -- Deir-Ez-Zor, Fourth Annex and Ash Sham, which are operated by the Al Furat Petroleum Company. Shell has a 31.25-per cent stake in AFPC, it said.

The licences cover around 40 oil fields and Shell's share of output from the fields was 23,000 barrels of oil equivalent per day last year, it added.

CNPC already had an interest in the production licences and in AFPC through its 50-per cent ownership of Himalaya Energy Syria BV.

The agreement strengthens the partnership between Shell and CNPC, and the two firms will "continue growing and investing in attractive opportunities in Syria's upstream industry", the statement said.

Syria's oil production has steadily declined over the past decade while its gas output has risen. The country has estimated gas reserves of 284 billion cubic metres (9.94 trillion cubic feet).

Shell on Sunday also signed a 30-year agreement with PetroChina, the listed arm of CNPC, and Qatar Petroleum to search for natural gas in the Gulf state's Block D area.