Reference: 11687 Pre-Approval

Qaidam Basin Gas Exploration Project

Country: China ( A3 / BBB / A- )

Location: Qaidam basin in central-western China.

Type: Turnkey

Sector: Gasfield exploration and development

Borrower Type: Quasi Corporate

Sponsors

- Agip China BV

- China National Petroleum Co (CNPC)

Operator: PetroChina

Remarks

The project involves gas exploration in the 7,000km Qaidam basin in central-western China. The Qaidam gasfields has estimated reserves of 250bn cubic metres. The development of gasfields is in line with the Chinese government's policy of using natural gas instead of coke as a fuel source for power generation plants.

On May 26 2000, Agip China BV, a subsidiary of Eni, the Italian oil and natural gas company was awarded an exploration permit for the Qaidam basin by the government of the People's Republic of China. A production sharing agreement was signed between Agip China BV and state oil company China National Petroleum Co (CNPC) to exploit natural gas reserves from the basin. The contract is to be carried out by PetroChina, the operating company of CNPC.