PetroChina's Parent Agrees to Buy PetroKazakhstan.
August 22, 2005 AK&M
China National Petroleum Corp., the nation's biggest oil company, agreed to pay $4.18 billion for PetroKazakhstan Inc., beating offers by rivals including India's biggest oil producer to secure supplies as demand soars in China.
China National Petroleum, the parent of Hong Kong-listed PetroChina Co., agreed to pay $55 a share for PetroKazakhstan, or 21 percent more than its closing share price on Aug. 19, PetroKazakhstan said in a statement today. Calgary-based PetroKazakhstan's board recommended that its shareholders accept the Chinese oil company's offer. The transaction is expected to close in October.
PetroKazakhstan accounts for about 12 percent of oil production in Kazakhstan, the company's only source of output. Among former Soviet states, Kazakhstan is second only to Russia in oil production. Chevron Corp. and other producers have made acquisitions this year to bolster output and reserves amid record prices.
Kazakhstan held 3.3 percent of the world's oil reserves at the end of 2004, according to data compiled by BP Plc. The country's 39.6 billion barrels of oil reserves were 35 percent greater than the U.S. total. Kazakhstan produced 1.3 million barrels of oil a day last year.
PetroKazakhstan, the third-largest oil producer in Kazakhstan, on June 27 said it had been approached by several prospective buyers.
The company's production averaged 151,102 barrels of oil a day in 2004. State-owned KazMunaiGas is the largest oil producer in Kazakhstan, followed by Chevron.
PetroKazakhstan is the former Hurricane Hydrocarbons, which sought bankruptcy protection in 1999 after it was unable to pay debts when crude prices tumbled
Company — PetroKazakhstan
Full namePetroKazakhstan Inc.
IndustryOil and gas