CNPC (HK) Increases Interest in Salyan Oil Joint Venture

CNPC (Hong Kong) Ltd. has increased its position in the Salyan joint venture to 25%. CNPC (HK) paid US $14.5 million to acquire 10% in the Salyan Oil joint venture from Delta Hess. This purchase increased CNPC (HK)'s position in the venture to 25%. Another CNPC subsidiary, China National Oil and Gas Exploration and Development Corp., also bought a 10% stake in the venture, ending Delta Hess's participation in the Azerbaijan project. Delta Hess is a venture between Delta Oil and Amerada Hess Corp.

Earlier this year CNPC (HK) purchased a 15% stake in the project for US $26 million. China National Oil and Gas Exploration and Development Corp. bought the same size stake for the same price at the same time. Subsidiaries of CNPC now control 50% of Salyan Oil. The project is the first Chinese investment in Azerbaijan's oil industry. The company says the goal of this investment is to increase its reserves and profits. Salyan Oil is developing the Kursangi-Karabagly onshore oil fields south of Baku with estimated reserves of 750 million barrels of crude oil.