CNOOC takes first step in entering US market

Norwegian energy group Statoil announced Wednesday that it had sold parts of its oil assets in the Gulf of Mexico to China National Offshore Oil Corporation (CNOOC).

If approved by the US government, CNOOC would be the first Chinese energy company to enter the US market.

The deal involves the sale of Statoil's 20 percent stake of Tucker prospect and a 10-percent stake in the licences of the Krakatoa, Cobra and Logan blocks to CNOOC. Statoil made the announcement together with the release of its quarterly earnings statement.

The statement said Statoil will remain the operator of the four blocks but did not disclose the transaction details.

Statoil is a major player in the Gulf of Mexico and has won many leases from the US government to explore and develop the region. It is customary to invite partners to co-develop the leases gained in region to spread the risks. So when Statoil solicited partnerships for the development of the four blocks it gained in 2007 and 2008, CNOOC outbid other rivals and won the deal.

The arrangement needs the approval from the US Minerals Management Service, which controls American oil leases. According to the rule, a company must be incorporated in the US before conducting any business in the region, thus CNOOC would need to set up a US subsidiary to meet the requirements.