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CNPC wins Canada oil sands exploration rights

By ()
Updated: 2007-06-29 16:11

China National Petroleum Corp (CNPC), the parent of PetroChina Co Ltd has won exploration rights to oil sands in Alberta, Canada, said company sources.

The exploration area is 258.6 square kilometres, and is expected to eventually yield 220,000 barrels of syncrude daily.

The oil sands, which are more expensive to process than light crude, are viable as long as crude prices are above 30 US dollars per barrel.

The deal is the first case of a Chinese firm controlling a Canadian oil sands project.

In April 2005, CNOOC Ltd agreed to acquire a 16.69 percent stake in Canada's MEG Energy Corp for 150 million cad.

MEG owns oil sand leases in 52 contiguous sections totaling about 32,800 acres in Alberta.

China Petrochemical Corp (Sinopec Group) also agreed to pay 150 million cad for a 40 percent stake in a joint venture producing synthetic crude from western Canada oil sands.

CNPC's project, due to enter operations in 2009, is expected to produce at least 100,000 barrels of syncrude a day for more than 30 years.

Canada ranks second in the world in recoverable oil sands reserves at an estimated 175 billion barrels.


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