OIL SANDS EXPLORATION: China to invest $1.7-B in two projects

ALBERTA — PetroChina, the marketing branch of state-owned China National Petroleum, will invest as much as $1.7 billion for a 60% share the MacKay and Dover oil sands leases belonging to Athabasca Oil Sands Corp. (ASOC). Federal industry minister Tony Clement gave official permission for the deal on Dec. 29, 2009.

The two projects have an estimated combined in situ resource of 5.0 billion bbl of bitumen. That is a worthy prize for a country that consumes an estimated 7.9 million bbl per day. Moreover, Chinese demand is estimated to grow by 12% in 2010. (By comparison, demand in the United States in 2008 was 19.5 million bbl/d and in Canada was 2.3 million bbl/d.)

PetroChina will spend an initial $250 million for its share of capital expenses at the MacKay and Dover projects over the next three years. It will also maintain a head operating office in Alberta, increase Canadian employment, and ensure that Canadians fill a majority of senior management positions in the operating companies. Total investment is estimated to be as high as $1.7 billion.

PetroChina is publicly listed on the New York and Hong Kong stock exchanges. Further information about PetroChina is available at www.PetroChina.cn/ptr/.