China CEFC Energy Company Limited, who ranked 229 in Fortune 2016 Global 500, has bet more investment on the Belt and Road countries in recent years after finding thebusiness opportunities in the latter’s market.
The company’s generous investment came at a proper time for merger and acquisition of oil and gas assets. Headache with the record-low oil price in recent years, the producers in Middle East, Central Asia and other countries along the Belt and Roadhave been seeking business chances.
“Taking this historic opportunity, CEFC has actively sought for international capacity cooperation,” said the company’s Executive Director of the Board Ye Jianming, adding that it has formed a systematic layout covering the wholeindustrial chain.
CEFC is the 8th largest energy enterprise in China, and also the only private company among the country’s top 10 energy giants.
According to Ye, the CEFC also hopes to play a bigger role in balancing the allocation ofglobal resource, safeguarding national energy security and enhancing cultural exchanges among the countries along the Silk Road.
The company signed equity transfer agreement with KazMunaiGas (KMG), the national oil company of Kazakhstan in December 2016, acquiring 51% share of the KazMunaiGas International (KMGI).
The KMGI possesses a plenty of oil refineries and more than 1,000 gas stations in important European oil and gas hubs such as Romania. In addition, it also has a retail network in Europe.
The transfer has given CEFC the access of KMGI’s advanced oil depot management system, a 7,000-staff globalized operating and managing team, as well as developed major oil refineries and chemical plants in Europe.
The firm also plans to invest more in Europe bypurchasing gas stations and ancillary oil depots in Italy, Spain, Romania, Bulgaria, Germany and Switzerland.
In the meantime, it will conduct strategic mergers for major European oil refineries, oil depots and pipelines and increase its weight at key logistic nodes, in a bid to transform itself into an influential oil and gas terminal provider in Europe.
The company’s ultimate goal is to connect Chinese market with upstream resources in Central Asia and terminal resources in Europe.
On February 20, CEFC reached a 40-year agreement with Abu Dhabi National Oil Company (ADNOC) to acquire the final 4% interest in Abu Dhabi’s onshore oil concessions.
On top of this, the company has also signed a long-term supply agreement with ADNOC that would secure another 10 million tons of oil per year. As a result, 13 million tons of crude oil would be provided by the latter for China annually.
Another project invested by the company to transport liquefied petroleum gas from Kazakhstan to China by railway was approved at the end of the last year as well.
The first 18 railway tankers carrying liquefied petroleum gas departed from Dostyk transshipment station held by CEFC for Kuitun, northwestern China’s Xinjiang Autonomous Region on January 12, 2017.
(Source: People's Daily)