When the Chinese government-owned energy company Cnooc (China National Offshore Oil Corporation) tried to buy the U.S. oil company Unocal back in 2005, it was forced to withdraw its bid because of national security concerns in the U.S. Five years later, Cnooc, having already purchased access to offshore fields in the Gulf of Mexico, has now concluded a deal to buy into Texas oil fields in an effort to expand energy supplies for the growing Asian country and to gain access to new drilling technology.

 

Cnooc will purchase a third of Chesapeake Energy’s oil and gas assets in a south Texas shale deposit for $1.1 billion. The Chinese company will spend another $1 billion to expand the number of oil rigs from 10 to 40 in order to push production up to 500,000 barrels a day within 10 years. The transaction still has to be approved by the Committee on Foreign Investment in the United States.

 

The deal by Cnooc is the largest purchase ever by the Chinese of American energy assets.

-Noel Brinkerhoff, David Wallechjnsky

 

Cnooc in $2.2 Billion Deal With Chesapeake Energy (by Chris V. Nicholson, New York Times)

Cnooc Taps U.S. Expertise (by Angel Gonzalez, Wall Street Journal)