Eagle Ford deal to ease China demand for natural gas
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Cnooc Ltd's just concluded acquisition of a one-third stake in Chesapeake Energy Corp's Eagle Ford shale project spells a win-win for both parties, according to industry watchers.
The move demonstrates China's interest in investing in clean energy as a way of meeting its carbon emission goals.
Cnooc, China's largest offshore oil and gas company, inked the deal to snap up a one-third stake in the Texas shale project for $1.08 billion.
Hong Kong-listed Cnooc thus obtains 33.3 percent of Chesapeake's 600,000 acre (242,817 hectare) oil and gas leasehold in Eagle Ford, the biggest acquisition of a US oil and gas asset by a Chinese company, the company said on its website Tuesday.
"The deal will benefit both sides," said David Hanna, senior director of Asia Business Devel-opment with Platts, a global energy information provider. "Chesapeake will get foreign invest-ment amid the shale gas oversupply in the US; while Cnooc can increase their energy reserves, especially gas reserves."
"China maintains the backbone of the world energy demand, and natural gas is certainly set to play a central role," said Nobuo Tanaka, executive director with the International Energy Agency (IEA), at a press conference Wednesday in Beijing.
Data from the International Energy Agency shows that China's natural gas demand will grow at least 6 percent per year, accounting for more than one-fifth of growth in global demand through 2035.
"There is the potential that Chinese gas demand will grow even faster than this, especially if coal use is restrained for environmental reasons," the Paris-based energy watchdog said in a recent report.
The world's second-largest economy had set the goal of cutting energy consumption per unit of GDP by 20 percent by the end of 2010 compared with 2005.
And by 2020, China's carbon intensity will be reduced by 40 to 45 percent, compared with 2005 levels.
"A global age of gas led by China in the interest of diversifying the fuel mix can contribute greatly to reducing carbon dioxide and other emissions," Tanaka said.
