HONG KONG – Chinese oil giant CNOOC, chasing global energy assets to feed the country’s rapid growth, has made a joint $US5 billion bid with Ghana National Petroleum Corp for major fields in the West African state, a source close to the deal said.
The offer tops an earlier failed bid of more than $US4 billion from Exxon Mobil for Kosmos Energy LLC’s assets, which include a 23.49 per cent stake in Jubilee, one of the largest oil discoveries in the world in recent years.
GNPC has been vocal about wanting to increase its stake in the oil blocks but sources close to Kosmos previously said it had failed to secure funding.
Kosmos said the Exxon deal, agreed last year, expired in August, after the parties failed to secure Ghanaian government approval.
GNPC sources have told Reuters since last year that it had been talking to CNOOC about a possible bid.
CNOOC and domestic rivals Sinopec and PetroChina are all hungry for assets to support Chinese economic expansion.
"PetroChina, Sinopec and CNOOC have all had an international strategy for a while now, which is to go out there and do deals where they can," Yuanta Research analyst Tan Kim-Chong said.
A CNOOC spokesman could not immediately be reached for comment.
China emphasised its interest in Ghana last month, agreeing a $US13 billion loan package to fund projects in the West African country.
A sale by Kosmos, which is backed by private equity firms Blackstone Group and Warburg Pincus, would follow the traditional explorer business model of selling assets as they move close to production, and reinvesting the proceeds in making new finds.
News of the bid comes just two weeks after China National Offshore Oil Co (CNOOC) agreed to pay $US1.1 billion for a stake in a US shale oil and gas field, as the company looks for new oil sources to help it meet aggressive output targets.
"CNOOC’s own assets are probably being squeezed too hard … so they have to go abroad to buy things to give CNOOC a future," Macquarie Research analyst Laban Yu said.
"So they are willing to pay high premiums for these assets and there will be benefits to China as a country to secure energy supply. But it will not be beneficial to shareholders," he said.
State-owned Ghana National is also holding preliminary talks with Statoil ASA, seeking to interest Norway’s largest oil company in becoming a third partner in a Kosmos bid, according to Bloomberg, which added that BP had also been looped into the talks but decided not to advance.
Statoil and BP declined to comment.
Last month media reported that Kosmos, a Texas-based oil and production company, was considering an initial public offering that would value that company at about $US5 billion.
Bloomberg said on Friday that Kosmos was working with Citigroup and Credit Suisse on the IPO plans. The banks could not immediately be reached for comment.
CNOOC shares sag
CNOOC shares, which jumped after the US shale oil deal earlier this month, closed down 0.87 per cent in Hong Kong, lagging the broader market which was down 0.56 per cent.
CNOOC had been a noticeable absentee from large overseas M&A since it paid $US2.7 billion for a stake in French oil major Total’s African Akpo field in 2006.
A year earlier, it was bumped by a US political backlash from buying US-based oil company Unocal. Analysts had begun to question the group’s bullish production growth forecasts, pushing CNOOC to seek more outbound deals.
The Ghana field holds an estimated 1.8 billion barrels of crude.
Most outbound acquisitions by China’s oil companies this year have been in riskier areas such as Africa or in locations with ageing assets.
The 10 deals so far this year for China’s oil and gas companies have been worth $US18.6 billion, already eclipsing the $US15.8 billion in deals for all of 2009, according to Thomson Reuters data.