China’s state-owned Sinopec Group has agreed to buy Daylight Energy Ltd for C$2.2bn ($2.1bn), gaining control of Canadian oil and shale gas reserves.
Sinopec would gain access to more than 300,000 acres of land in areas rich with oil and natural gas through the deal. Over the past five years Chinese firms such as Sinopec and Cnooc have spent almost $30bn on Canadian assets that could help meet their country’s soaring energy demand.
Analysts suggest the acquisition could be aimed at developing liquefied natural gas (LNG) exports to the Asia-Pacific.
Sinopec’s future growth will “mainly come from unconventional gas”, said Chairman Fu Chengyu.
In Alberta, Daylight owns rights to more than 130,000 acres of the Duvernay shale block where the company expects to find oil and liquids rich in gas, the company has said.
Sinopec Group, along with Cnooc and China National Petroleum Corp are expected to seek partnerships for developing technology that can unlock China’s shale gas reserves, estimated to exceed those of the US.
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