China National Offshore Oil Corp. (CNOOC) has signed an agreement with Zhejiang Energy Group Co. Ltd. to invest in a joint venture to develop an intraprovince natural gas distribution network, said CNOOC unit CNOOC Ltd.
The agreement will help develop the gas market in Zhejiang province, China.
Partners in joint venture company Zhejiang Natural Gas Development Co. Ltd. will be Zhejiang Energy Group Co. Ltd., Nandu Group Holding Ltd., Zhejiang Power Corp., and CNOOC with a 27% interest.
CNOOC Ltd. has an option to acquire its parent’s interest in the company.
Zhejiang Natural Gas Development Co. Ltd. will undertake the construction, operation, and management of natural gas pipelines, the intraprovince wholesale and distribution of natural gas, and the development of a gas-fired power plant and other natural gas related infrastructures and projects.
It plans to acquire gas from all sources, including offshore gas, onshore inland gas, and possible LNG gas.
Wei Liucheng, the chairman and CEO of CNOOC Ltd., said, “Zhejiang is one of the fast growing and most prosperous costal provinces and has huge potential for gas demand. The investment plan is consistent with the company’s natural gas strategy.”
CNOOC Ltd. is a 70.6% held subsidiary of CNOOC.