Cnooc to buy half of Argentina's Bridas for US$3.1 bil.

Bulgheroni will retain the remaining 50 percent of Bridas, which has oil exploration and production operations in Argentina, Bolivia and Chile, according to a Cnooc statement filed today with Hong Kong's stock exchange. Bridas also owns 40 percent of Pan American Energy LLC, in which BP Plc has a stake.

Cnooc's acquisition adds to at least US$13 billion of energy acquisitions by Chinese companies since December 2008 as the nation scours the globe for resources to feed the world's fastest-growing major economy. Cnooc was earlier seeking to bid for a Devon Energy Corp. stake in an Azerbaijan oil field, said two people with knowledge of the matter in February.

“Given China's increasing reliance on imported crude oil and the nation's robust demand in fuel driven by the rapid growth in automobile sales, it is a priority for the Chinese government and its companies to secure resources globally,” said Wang Aochao, head of China energy research at UOB-Kay Hian.

'Good Beachhead'

Cnooc Chairman Fu Chengyu said in an interview earlier today that the company has made “good progress” since stepping up efforts to increase cooperation with foreign countries and companies in December 2008. Company President Yang Hua said in a statement that the Bridas purchase represents “a very good beachhead for us to enter Latin America.”

China is the world's second-biggest energy consumer, after the U.S., and Cnooc estimates the Bridas acquisition will boost the company's proven reserves by 318 million barrels of oil equivalent and its average daily production by 46,000 barrels. The deal will need to be approved by the Chinese government, Cnooc said.

Pan American Energy was formed in September 1997 through the merger of the Argentine units of Bridas and Amoco Corp., which was acquired by BP in August 1998. Pan American has since become Argentina's second-biggest producer of crude, behind the Argentine unit of Repsol YPF SA and was the country's largest exporter of oil in 2009.

“Cnooc will have to expand overseas production through acquisitions because its domestic fields are unlikely to be able to help the company reach its output goals for this year,” said Qiu Xiaofeng, an oil analyst at China Merchants Securities Ltd.

PetroChina Co. in December won approval from the Canadian government to buy a stake in two Alberta oil-sands projects for C$1.9 billion (US$1.86 billion). China Petrochemical Corp. completed its C$8.3 billion acquisition of Addax Petroleum Corp. in August.

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