Sinopec completes deepwater stake acquisition

Sinopec International Exploration and Production Corporation (SIPC), a wholly-owned subsidiary of China's state-owned Sinopec Group, has completed its $680 million acquisition of an 18-per cent stake in Chevron Corp's Indonesian deep-water project, according to media report.

In December 2010, Sinopec, Asia's largest crude refiner, said that it will acquire an 18-per cent stake in Chevron's $8-billion Gendalo-Gehem deep water natural gas project in Indonesia, for $680 million

Chevron had said in November 2009 that it would seek partners for a partial farm-down of its holding in the Gendalo-Gehem project in order to alleviate risk in the venture.

Chevron, based in San Ramon, California, owns 80 per cent of the project, while Eni of Italy and Indonesia's state-owned oil and gas company PT Pertamina own the remaining 20 per cent.

The Gendalo-Gehem project consists of three blocks located in the Makassar Strait offshore East Kalimantan in water depths of approximately 6,000 feet.

Chevron has projected maximum daily production from the project to be 1.1 billion cubic feet per day of natural gas and 31,000 barrels per day of condensate.

Gas from the project will be used both domestically and also converted to liquefied natural gas (LNG) at the Bontang LNG facility for export. (*)