PetroChina to sell major pipeline assets to PipeChina for $38 bln (updated)

Kunlun Energy

24/07/2020 01:00

(Repeats with no changes to text)
    July 23 (Reuters) - PetroChina, China's state-owned oil and
gas firm, said on Thursday it would sell its major oil and gas
pipelines and storage facilities to the newly launched China Oil
and Gas Pipeline Network for 268.7 billion yuan ($38.36
billion).
    The creation of the new company, also called PipeChina,
marks the largest industry reshuffle in the country in the past
two decades, aimed at providing fair market access to
infrastructure and boost investment in oil and gas production.
    Beijing started considering reforming the sector nearly a
decade ago but only approved the plans early 2019, spurred by a
national campaign to boost consumption of the cleaner burning
natural gas and curb dirtier coal.  urn:newsml:reuters.com:*:nL4N28G29L
    As part of Thursday's deal, PetroChina said it will get a
stake of about 30%, worth 149.5 billion yuan, in PipeChina and
that the new entity would pay the rest in cash.
    The sale excludes the assets of Kunlun Energy  0135.HK , in
which PetroChina  601857.SS   0857.HK  has a 54.4% stake, it
said in a statement.  urn:newsml:reuters.com:*:nHKSc5yJmh
    Upon completion of the transactions, PipeChina will become
an associate company of PetroChina, a listed arm of CNPC.
    PetroChina expects to book a gain of 45.82 billion yuan from
the disposal of its assets, which it will use to pay dividend
and for capital expenditure, it said in a statement.
    Earlier in the day, China Petroleum & Chemical Corp
 600028.SS   0386.HK  (Sinopec) also announced plans to sell
some of its oil and gas pipeline assets for 47.11 billion yuan
to PipeChina, of which 22.89 billion yuan will be injected into
PipeChina for an equity interest.  
       
 ($1 = 7.0049 Chinese yuan renminbi)

 (Reporting by Arathy S Nair and Sameer Manekar in Bengaluru and
Muyu Xu in Beijing and; Editing by Saumyadeb Chakrabarty and
Anil D'Silva)
 ((Sameer.Manekar@thomsonreuters.com; +918061823447;))