Sinopec Corp to Form JV With Parent

China Petroleum and Chemical Corp (Sinopec Corp) has agreed to set up a joint venture with its parent company to buy $3 billion worth of oil and gas assets held by the latter in a bid to improve its profitability, Reuters has reported.

The 50:50 venture between Sinopec Corp and Sinopec Corp's parent, China Petrochemical Corp (Sinopec Group) will buy oil and gas producing assets with 310 million barrels in proven and probable reserves, the news agency said.

The deal would boost Sinopec Corp's proven reserves by 9.1 percent to 3.1 billion barrels of oil equivalent (boe), and its annual crude production would rise 11.2 percent to 365 million barrels, Reuters said citing a company statement.

Sinopec Corp said a year ago that it was considering buying more overseas upstream assets from its parent to boost oil and gas production and counter mounting losses from selling gasoline and diesel at state-controlled prices. The company did not give details such as the location of the assets, Reuters said.