CHINA has made another step to owning African oil producing assets by slapping down a $4.4bn takeover offer for Swiss group Addax Petroleum. State–run refiner and oil producer Sinopec gained Addax board agreement for its $4.4bn acquisition, which would be China’s largest overseas investment in the oil and gas sector. The deal is part of a growing trend of Chinese companies investing in West African oil assets as China is sourcing more of its crude oil from Nigeria and Angola. Sinopec, which is a subsidiary of China Petroleum, will gain oil and gas production in West Africa and Iraq through this deal. Sinopec beat Korea National Oil to acquire Addax in an international bidding battle for the company’s strategic assets. Swiss-based Addax produces around 136,500 barrels per day of oil and has around 530bn barrels of reserves. It is a major investor in Nigeria and Gabon, where it leases floating production storage and offloading vessels from BW Offshore and Fred. Olsen. Addax also charters tankers for taking West African crude to North American and European refineries.
The board of the Toronto and London-listed firm recommended the C$52.80 per share offer to shareholders, a 16% premium over Addax’s share price.