Chinese oil company Sinopec agrees $2.2bn US shale deal

Sinopec will get a one-third stake in five new shale projects, with the firms expecting to drill 125 wells this year.

China has been buying energy sources to feed its fast-growing economy, and wants to improve its ability to extract domestic shale deposits.

China has some of the biggest shale deposits in the world.

'More exposure'

Analysts said that the recent increase in demand for shale oil and gas meant that many companies were now looking to tie-ups to help them expand quickly.

Sinopec, meanwhile, is not alone in trying to access US shale deposits, and France's Total announced a separate $2.3bn shale deal with Chesapeake Energy and EnerVest.

"It looks like the preferred transaction structure for a lot of these players, whether they are European or Asian, who are behind the curve on this technology," said Mark Hanson of Morningstar.

"The more exposure they get, the better."

Under the terms of the deal with Devon, Sinopec will pay $900m in cash, with the remainder of the investment being paid by the end of 2014; Kazinform cites BBC.

To learn more go to www.bbc.co.uk