CNOOC to set up venture to make pipilines
(Shenzhen Daily-Agencies)
Updated: 2006-02-10 13:37

CNOOC Ltd. and a domestic private firm will set up a joint venture company to make pipelines, marking the oil producer’s first foray into the petroleum pipeline manufacturing business, Shanghai-based Oriental Morning Post reported Thursday.

The joint venture, which will have annual pipeline output capacity of 300,000 metric tons, will help to meet CNOOC’s rising demand for pipelines following acquisitions of overseas oil and gas assets, said the paper.

CNOOC is China’s largest offshore oil producer by output.

The joint venture between CNOOC’s subsidiary CNOOC Base Co. Ltd. and Zhejiang-based Jinzhou Petroleum & Gas Pipeline Co. Ltd. is expected to involve a total investment of 9.9 billion yuan (US$1.2 billion), with 5 billion yuan coming from CNOOC and 4.9 billion yuan from Jinzhou.

Before the official establishment of the joint venture company, CNOOC and Jinzhou had jointly produced and exported 2,500 tons of pipelines to Myanmar, the Oriental Morning Post said.

CNOOC also intends to set up a pipeline research and development center under the joint venture company.

Jinzhou Group, the parent of Jinzhou Petroleum & Gas Pipeline Co. Ltd., is one of China’s largest pipeline producers. It was founded in 1982 with assets totaling 1.2 billion yuan.