China to open oil exploration to foreign firms ahead of signing a trade deal with the U.S
China has said it will for the first time allow foreign companies to explore and produce oil and gas in the country.
This will open up the industry to firms other than state-run energy giants as Beijing looks to boost domestic energy supplies.
Company with net assets of at least $43 million (Ksh4.3 billion), China says can now apply for licenses in what is seen as a major reform. Said China’s resource ministry on Thursday.
China said it would open the avenue for foreign firms ahead of next week’s meeting with the United States, awaiting the signing of interim trade deal between the two world’s powerful economies.
Oil and gas was one of the sector removed from the list of industries that restrict overseas investment in July, Bloomberg reported.
China’s crude imports have continued to break records, with its gas imports having grown steadily as she seeks swap out dirty coal for cleaner burning fuel across residences and industries.
China now imports 70 percent of crude oil it refines and nearly half its natural gas consumption, and state firms face an uphill battle boosting reserves and production outside China amid growing geopolitical risks.
Previously, international companies could enter the industry only via joint-ventures or through cooperation with Chinese firms, mainly state-owned majors such as China National Petroleum Company (CNPC), China Petrochemical Corp (Sinopec) or their listed vehicles.
Mineral resources mining permits will be valid for five years at initial registration, and can potentially be extended for another five years.