PetroChina in talks to develop Iraq oil field
BY YVONNE LEE
HONG KONG -- PetroChina said it intends to expand its overseas oil and gas investments and accelerate the development of natural gas business in China to boost the profitability of China's largest oil company by capacity.
President Wang Dongjin said it is in talks to develop West Qurna oil field in Iraq and hopes to conclude the negotiation by the end of this year.
We plan to buy more resources and have more investments in overseas, Mr. Wang told reporters in Hong Kong. By 2020, we hope to build PetroChina into a world class international energy, he said. However, he didn't provide further details of the Iraq deal.
The comments came after Exxon Mobil has asked Iraq if it can sell part of its stake in one of the country's largest oil fields to PetroChina, people familiar with the matter said earlier this month. A deal with PetroChina would deepen China's investment in the Iraqi oil sector 10 years after a United States led invasion ended Saddam Hussein's rule.
The West Qurna field has the potential to produce nearly 3 MMbbl of crude a day, rivaling some the world's largest oil fields.
China caps fuel prices, including those of natural gas, to keep its factories humming and protect its population from inflation. Under the current system, officials cap the price of natural gas regardless of whether it is produced domestically or imported.
Higher prices for cleaner burning natural gas will ultimately help cut emissions, which is a main source of smog. China has put increasing emphasis on natural gas as rising concerns over pollution have put coal and oil use under scrutiny.
China has been on an international quest to secure multiple sources of natural gas to help it meet targets to more than double the cleaner burning fuel's contribution to its energy mix to 10% by 2020 from less than 5% now. In addition to expensive pipeline and LNG projects, China is also trying to spur development of unconventional supplies such as shale gas, which is gas trapped in small rock formations.
Dow Jones Newswires