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Zhenhua Oil to buy gas fields

State- run Zhenhua Oil has signed a preliminary deal with Chevron to buy the US oil major’s natural gas fields in Bangladesh that are worth about $ 2 billion, two Beijing- based Chinese oil executives said.

Zhenhua is a subsidiary of China’s defense industry conglomerate NORINCO. A completed deal would mark China’s first major energy investment in the South Asian country.

Bangladesh holds the right of first refusal on the assets and could block the transaction. The country, via its national oil company Petrobangla, is keen to buy the gas fields and is talking to international banks to raise financing, according to a banking source familiar with the process.

Zhenhua Oil is a small oil and gas explorer that despite its connections to China’s defense industry is dwarfed in comparison with State energy giants PetroChina and Sinopec. It is trying to formalize its deal with Chevron by June.

The two companies signed a preliminary pact in January, the two senior oil executives told Reuters.

Zhenhua will work with China Reform Holdings Corp, an investment vehicle under the State- owned Assets Supervision and Administration Commission. Zhenhua will hold 60 percent of the deal and China Reform 40 percent.

Chevron, in an e- mailed statement, confirmed that it was in commercial discussions on its Bangladesh assets, but would not comment further as a matter of policy.

Chevron had said in October 2015 that it planned to sell about $ 10 billion worth of assets by 2017 including geothermal projects in Indonesia and the Philippines and gas fields in Bangladesh amid a prolonged slump in energy prices.

Bangladesh knows that Chevron is in talk with global companies, but has no specific knowledge about Zhenhua’s interest, said Nasrul Hamid, Bangladesh state minister for power, energy and mineral resources.

“This is Chevron’s matter. We’ll not interrupt but we are supposed to get the first priority,” he said when asked if Bangladesh would try to block the China deal.

ChemChina extends offer for Syngenta

China National Chemical Corp ( ChemChina) has extended until April 28 its $ 43 billion tender offer for Swiss pesticides and seeds group Syngenta, it said on Thursday.

The offer had previously been set to expire on March 2.

“As previously stated, extensions to the tender offers are expected to occur until all conditions to the offers are satisfied, including obtaining all applicable regulatory approvals. All of the other terms and conditions of the tender offers remain unchanged,” it said in a statement.

Syngenta said this month that it expected the deal to close in the second quarter.