China is considering ways to restructure the overseas businesses of its largest oil and gas producer, CNPC, including a $5 billion asset injection plan, a newspaper said on Monday.
The plan envisages China National Petroleum Corp (CNPC) selling its overseas assets to PetroChina, making its flagship subsidiary the main international arm, the Hong Kong Economic Times said.
PetroChina might need to pay $5 billion for CNPC's assets if the idea were to take off, the paper said, citing an unidentified source. A PetroChina official declined to comment.
If the plan were to succeed, industry sources said, it could help oil-starved China streamline the overseas operations of the two companies.
China, the world's second-largest oil consumer that imports 40 percent of its 6 million barrels of daily oil demand, has been driving its oil firms to acquire overseas assets since 1993.
CNPC has poured billions of dollars into assets in Sudan, Kazakhstan, the Middle East and South America. Its annual overseas equity production of crude oil has reached more than 10 million tonnes.
But in some cases, the oil companies, including the overseas arms of CNPC and PetroChina, as well as Sinopec Group, compete against each other for the same assets, forcing the government to step in to mediate, analysts said.
He said it would make sense if CNPC allowed PetroChina to control its overseas arm, known as CNODC.
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