Asia’s largest oil and gas company PetroChina has established a new pipeline unit by combining three subsidiaries and restructuring assets with domestic partners via equity transfers. The move is in preparation for possible divestments.
PetroChina would own 72.26% of the new pipeline unit called PetroChina Pipelines. Other partners, which include institutional investors and private firms, would transfer their previous holdings and eventually own the remaining 27.74%.
The new pipeline unit will combine the assets of Eastern Pipeline Co., Northwest United Pipeline Co. and PetroChina United Pipelines Co.
Among its key investors are Guolian Fund, China’s National Social Security Fund, several insurance companies and private firms such as Youngor Group.
After the transactions, the new pipeline unit will have registered capital of CNY 80 billion (USD 12.3 billion), from the previous CNY 50 billion (USD 7.6 billion).
“This … establishes a unified platform for managing the pipeline assets and financing, setting a solid foundation for future pipeline construction,” the company said in a statement.
PetroChina produces two-thirds of China’s natural gas and controls almost 80% of the country’s 90,000-kilometre gas pipelines.
China is expected to soon unveil a sweeping reform package of its vast energy sector, in an effort to boost efficiency and attract private investment to the sector.