CNOOC VP: Mulls Entry into US Gulf of Mexico in Two Years

HOUSTON , May 05, 2008 (Dow Jones Newswires)

China National Offshore Oil Corp. (CEO) is looking for ways to acquire oil and gas assets in the U.S. Gulf of Mexico "in two years," a top company executive said Monday.

CNOOC, which is controlled by the Chinese government, is "looking for opportunities," Zhou Shouwei, a CNOOC vice president, told Dow Jones Newswires on the sidelines of an energy trade show.

CNOOC was most likely to make a foray into the Gulf of Mexico by buying exploration rights in federal waters in a government lease sale, Shouwei said. CNOOC would most likely look for a partner, a common practice in the industry for acquiring fields in deeper water, which are more expensive to develop.

Many foreign companies operate in the Gulf, with Asian firms in particular increasing their presence in recent years.

No Chinese company currently owns reserves in the U.S., however, and CNOOC's last bid to enter the country, its 2005 attempted acquisition of Unocal, was withdrawn under intense political pressure from the U.S. Congress.

Oil companies from nations that are net energy consumers, such as Japan and South Korea, have turned to the U.S., and the Gulf of Mexico in particular, to provide stable production to balance riskier activities abroad.

Analysts say Chinese companies remain interested in buying assets in the U.S., though on a small scale in order to avoid a repeat of the failed Unocal deal.

Copyright (c) 2008 Dow Jones & Company, Inc.

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