PetroChina to Sell Major Pipeline Assets to PipeChina for $38 Billion
(Reuters) — PetroChina, China's state-owned oil and gas firm, said on Thursday it would sell its major oil and gas pipelines and storage facilities to the newly launched China Oil and Gas Pipeline Network (PipeChina) for 268.7 billion yuan ($38.36 billion).
The sale excludes the assets of Kunlun Energy, in which PetroChina has a 54.4% stake, it said in a statement.
Separately, China Petroleum & Chemical Corp (Sinopec) on Thursday announced plans to sell some of its oil and gas pipeline assets for 47.11 billion yuan to PipeChina, of which 22.89 billion yuan will be injected into PipeChina for an equity interest.
Launched in December last year as part of a sector-wide reform, PipeChina had not been allocated any assets until this week, despite signing agreements with the national oil majors.
The deals come as a part of Beijing's plans to boost investment in oil and gas production and provide a fair market access to small, non-state owned oil and gas producers and distributors.
The deal will give PetroChina a stake of about 30% in PipeChina. The stake is worth 149.5 billion yuan, PetroChina said. The remainder will be paid in cash.
Upon completion of the transactions, PipeChina will become an associate company of PetroChina, a listed arm of CNPC.
PetroChina expects to book a gain of 45.82 billion yuan from the disposal of its assets, which it will use to pay dividend and for capital expenditure, it said in a statement.
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