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Mainland, Taiwan to Enter Joint Oil and Gas Project

The China National Offshore Oil Corporation (CNOOC) and the Chinese Petroleum Corpration of Taiwan will jointly explore oil and natural gas in the Taiwan Strait, a report said on Wednesday.

CPC president Pan Wen-yen would fly to the mainland next week to sign a letter of intent with CNOOC for the project.

The cooperation involves seismic testing and drilling in the targeted area covering 15,400 square kilometers (9,240 square miles) in the Tainan basin between southern Taiwan and Guangdong province.

A CPC spokesman stopped short of confirming the deal but said: "Both sides feel the need for exploration."

CPC and CNOOC conducted initial geophysical studies under a two-year contract signed in July 1996 and the study showed possible rich oil and natural gas reserves, the CPC official said.

But the cooperation was halted in late 1996 after the Taiwan authority introduced new controls on investment and trade links with the mainland.

In August, CNOOC chairman Wei Liucheng said in an interview with the Asian Wall Street Journal that Beijing had thrown its weight behind the joint exploration plan and the contract was tentatively scheduled to be signed in November.

"We are much stronger in terms of exploration and development capability, and they are much better at refining. It's an excellent union," Wei said.

But he declined to disclose financial terms of the deal.

(China Daily 10/02/2001)

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