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SCMP Reporter

Canadian target owns oil and gas stakes in Libya
China National Petroleum Corp, the largest oil company on the mainland, is bidding for Canadian-listed Verenex Energy in a deal valued at as much as US$300 million,  sources said.
A successful bid  would widen CNPC's assets in Africa, as Verenex owns  oil and gas deposits in Libya.
Verenex  said earlier that Libya's state-owned oil company had  given approval for several international oil  firms to look at technical data  from its fields.
'The Chinese like Libya because of the geology there,' said a  source.
Certain geological formations can make oil easier or more difficult to extract, and oil companies can develop expertise at working in  specific environments.
The mainland continues its drive for natural resources despite slowing economic growth, as its domestic supply in the northeast  approaches the end of its productive life.
Resource-rich Africa and the Middle East are high on the list of regions targeted by  mainland companies.
China National Overseas Oil Corp and  CNPC continue to jointly pursue  a stake of as much as US$2 billion  in an oilfield in  Angola owned by  Marathon Oil of the United States.
Sinopec, the largest oil refiner  on the mainland, is trying to finalise a US$1.8 billion bid for Tanganyika Oil, which owns assets in Syria.
Sinochem Corp, the mainland's largest chemicals trader,  paid US$465 million in February to  Britain's  Soco International for the 16.79 per cent stake it owns in an oilfield in Yemen.
Calgary-based Verenex said on November 26 that it had opened data rooms 'to facilitate a potential corporate sale as one of the strategic options currently under review'.
Such a move allows   acquisitors to access financial data and other information about a potential target.
The sale would also likely attract interest from other oil companies active in Africa, such as  Britain's Tullow Oil, industry observers said.
Indonesia's state-owned oil company, Pertamina, which owns two  exploration blocks in Libya, said  this month that it was interested in Verenex's Libyan asset.
Verenex said it  owned a 50 per cent operating stake in Area 47 in Libya's Ghadames Basin  in the west  near the border with Tunisia. Indonesia's Medco Energi Internasional owns the other half of the operating stake.
The two firms are entitled to 13.7 per cent of all production from the asset, according to an agreement signed with the Libyan government, which receives the rest.
Area 47 contains a prospective 2.15 billion barrels of oil, according to the company.
A proposed phase one development plan could see 50,000 barrels of oil a day produced by 2011.
Verenex also owns stakes in three  minor oil and gas blocks  in  southwestern  France, near Paris and in the Canadian province of Alberta,  its website says.
Verenex and CNPC declined to comment.
Favourable geology
Verenex owns a 50pc operating stake in part  of Libya's Ghadames Basin
The company says the basin may contain oil reserves of,  in barrels: 2.15b



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