Sinopec to buy Occidental Argentine assets

[December 10, 2010]  SHANGHAI (AP) -- China's Sinopec Group, the country's biggest oil refiner, said Friday it plans to buy Occidental Petroleum's Argentine assets for $2.45 billion.

Sinopec, also known as China Petrochemical Group, said it will acquire all of the American oil company's assets in Argentina, in its first foray into that country's energy sector.

The move is aimed at diversifying state-owned Sinopec's upstream assets as it seeks to reduce surging costs from importing crude oil for refining.

Occidental Petroleum Corp. holds reserves of 393 million barrels of oil equivalent and produced more than 51,000 barrels of oil equivalent per day in Argentina last year, Sinopec said in a statement.

The deal is subject to government approval.

Los Angeles, California-based Occidental is the fourth biggest U.S. oil and gas company, with market capitalization of $66 billion by the end of 2009.

Sinopec has recently stepped up its activities in South America, also forming an alliance in Brazil with the Spanish energy company Repsol to create a $17.8 billion private energy group. Sinopec is to hold a 40 percent stake in that venture.

Asia's largest refiner by capacity, Sinopec is the biggest petroleum and petrochemicals company in China, producing over 350 million barrels of oil equivalent annually, and with reserves close to 4 billion barrels of oil equivalent. The company has almost 50 projects in 20 countries.

[Associated Press]

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