The new agreement builds upon the initial partnership formed between the two companies in October of last year and follows several months of discussion both between the two companies and with the asset owners of potential projects in China and in other parts of the world.
"During the next 10 to 20 years, China will have to participate in international energy trade on a substantial and sustained basis, and make environmental choices about fulfilling its burgeoning energy needs," said Mr. Friedland. "The challenge of meeting China's energy needs presents a wealth of opportunities for Ivanhoe Energy, particularly in meeting the demand through clean energy sources."
The alliance will see CITIC Energy, a wholly-owned CITIC subsidiary based in Hong Kong, combine resources with Sunwing Energy, Ivanhoe's China flagship subsidiary. This will assist in the financing and rapid development of Sunwing's exploration and development projects in China, including Sunwing's oil project in the Dagang Oilfield and the Zitong and Yudong natural gas projects in the Sichuan Basin. The immediate priority will be CITIC's direct investment in the development phase of the Dagang project.
The alliance will seek and identify suitable interests in international oil and gas development projects for joint development. Upon acquisition of these projects, the alliance may invite oil and gas companies in China such as CNOOC, PetroChina and Sinopec to invest in these projects. In addition, Ivanhoe Energy will assist in the introduction of gas-to-liquids (GTL) and other advanced clean, energy-sector technologies to China's domestic oil and gas industry.
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