CITIC Resources to Buy $1 Billion Worth of Kazakh Oil Assets

Tuesday, 8 May 2007 | 11:22 PM ET

CITIC Resources Holdings said it would buy oil assets in Kazakhstan from its state-owned parent for $1 billion, making it China's fourth-largest energy firm.

The company said it was planning a note issue to fund the purchase and would also exercise an option to buy a 90% stake in Tincy Group Energy Resources for $150 million.

Tincy holds the right to develop and operate an oil field, with estimated original oil in place ranging from about 65 million tons to 75 million tons in Bohai Bay Basin in Liaoning Province.

Sources had told Reuters last week that CITIC Resources would buy oil assets in Kazakhstan worth $950 million from its parent company, China International Trust and Investment Corp. (CITIC), and a stake in an oil field in China.

Investment company CITIC bought the Kazakh oil assets of Canada-based Nations Energy for $1.9 billion in 2006.

Shares of CITIC Resources have soared 62% so far this year to end at HK$3.68 on April 30 prior to a trading suspension. Trading of CITIC shares resumed Wednesday.


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