Dubai World Sets Up Venture For Foreign Oil, Gas Buys

LONDON, March 26, 2008 (Dow Jones Newswires)

Dubai-government funded investment company Dubai World has discreetly set up a venture for petroleum acquisitions abroad, according to people familiar with the matter, the latest Gulf company seeking new reserves beyond their oil-rich countries.

Dubai World has looked at acquisitions from Africa to South America and Asia and may invest hundreds of millions of dollars depending on opportunities, though no specific amount has been defined, one person said. Dubai World couldn't immediately comment.

The venture has yet to make acquisitions, but it has shwon prelimary interest in Royal Dutch Shell PLC's Nigeria stakes, bought last month by Oando PLC, and Azerbaijan's Caspian Energy Group.

CEG was acquired recently by Russian businessman Mikhail Gutseriev, that person said. It is now looking at further oil and gas assets in Kazakhstan and Western Africa -- including Angola, Gabon, Nigeria and Cameroon and coal-methane beds in Eastern Europe.

The venture is the latest for Gulf countries looking for future oil and gas abroad as their own fields deplete.

With plenty of cash after three years of soaring oil revenue, they are also spending abroad in a bid to diversify their investment portfolios and to gain further access to advanced technology and know-how. The Dubai government already has an international oil investment arm, Dubai Energy.

The person said "it's like a horse race. The more horses you own in the race, the more chances you have to win."

Abu Dhabi state-owned companies Mubadala and Abu Dhabi National Energy Co., or TAQA, have also started buying oil and gas assets abroad.

Last year, TAQA announced about $7.5 billion of acquisitions in Canada as part of a goal to invest $60 billion worldwide by 2012.

LONDON, March 26, 2008 (Dow Jones Newswires)