Energy: Oil & Gas - Bahamas Petroleum Company Plc

November 5, 2010 Europe: Energy: Oil & Gas - E&P
Strategic asset screen: Chinese buyers look for large oily or LNG-based assets
We believe that the companies most likely to benefit from NOC interest are those which hold what we would regard as “strategic”
assets. We have analysed deals done by Chinese NOCs since the beginning of 2008 to identify the types of assets bought in these
transactions. Of the 17 deals we have analysed, 12 involved net reserves of over 100 mnbls of oil, and one with liquids of over 50
mnbls. Of the other four, two were LNG-related and another involved Asian gas. In view of this, we define strategic assets as those
that have discovered reserves, are either oily, or gas to be monetized in emerging markets and that have in excess of 200 mnbls of
recoverable reserves with the stake in the field having net reserves of over 50 mnboe. Although we believe that stakes in such fields
could make companies attractive corporate targets, in some cases, asset transactions alone would be sufficient to give a material
uplift to share prices if that transaction took place at a lower cost of capital.
Exhibit 61: Chinese NOC deals have tended to focus on large, oily assets or gas that can be monetized in Asia
Most recent upstream deals performed by Chinese NOC companies with IOCs (excluding investment deals)
Date Buyer Seller Bid type Region Asset Asset type (GS defined) Total liquids (2P
+ 3P +
contingent)
10/10/2010 CNOOC Chesapeake Asset US Eagle Ford shale Liquids > 100 mn bls 0 0
01/10/2010 Sinopec Repsol Asset South America Santos Basin Liquids > 100 mn bls 360 120
21/05/2010 Sinochem Corporation Statoil Asset South America Peregrino Liquids > 100 mn bls 200 0
19/05/2010 CNPC RD Shell Asset Asia‐Middle East Syria Shell stake Liquids > 100 mn bls 215 0
30/04/2010 CNOOC Devon Asset China Block 15/34 16 32
12/04/2010 CNPC ConocoPhillips Asset Canada Syncrude Liquids > 100 mn bls 882 0
14/03/2010 * CNOOC Bridas Asset South America Share in S American JV Liquids > 100 mn bls 394 242
08/03/2010 PetroChina Arrow Asset Australia and Oceania Corporate LNG 0 590
31/08/2009 PetroChina AOSC Asset Canada Mackay River / Dover Liquids > 100 mn bls 5220 0
12/08/2009 Sinochem Emerald Energy Corporate Globally Diversified Corporate Liquids > 100 mn bls 187 0
24/06/2009 Sinopec Addax Corporate West Africa Corporate Liquids > 100 mn bls 1275 0
29/04/2009 ** CNOOC, Sinopec Talisman Asset Carribean Trinidad assets LNG 20 65
01/04/2009 Sinopec, SinoCanada Total Asset Canada Northern Lights Liquids > 100 mn bls 107 0
25/09/2008 ** Sinopec / CNOOC Marathon Asset West Africa Block 32 Liquids > 100 mn bls 300 0
25/09/2008 Sinopec Tanganyika Corporate Asia‐Middle East Corporate Liquids > 100 mn bls 2102 0
18/04/2008 CNOOC Husky Energy Asset Asia‐Southeast Asia Madura Asian gas 11 43
07/03/2008 Sinopec AED Asset Australia and Oceania Puffin / Talbot 60 0
* = 1P reserves only
** = GS research estimates
Source: Herold HIS, Goldman Sachs Research estimates, Company data.
Total gas (2P
+ 3P +
contingent)
Goldman Sachs Global Investment Research 50