CPFHK provides loan for acquisition of 35% ownership stake in Syria Shell Petroleum Development from Shell

On February 22, 2010, China National Petroleum Corporation (CNPC) concluded a share purchase agreement with Shell in which CNPC agreed to acquire a 35 percent ownership stake in Syria Shell Petroleum Development (SSPD), a unit of Royal Dutch Shell, for $1.6 billion. At the time, SSPD had interests in three production licenses -- Deir-Ez-Zor, Fourth Annex and Ash Sham -- that are operated by the Al Furat Petroleum Company (AFPC), in which Shell had a 31.25 percent ownership stake. CNPC Finance (HK) Limited (CPFHK) issue a loan to CNPC to facilitate the acquisition. Then, in May 2010, the acquisition was completed. In December 2011, in compliance with international sanctions on Syria, including European Council Decision 2011/782/CFSP, Shell suspended all exploration and production activities in Syria.

Additional details

1. This project is also known as the Euphrates Project. The Chinese project title is 中东地区叙利亚幼发拉底项目 or 敘利亞幼發拉底項目. 2. CNPC Finance (HK) Limited is identified by official sources as the financier of the acquisition. AidData assumes for the time being that the face value of the acquisition (overseas investment) loan (境外投资项目案例) from CPFHK was worth approximately 75% of the the total cost of the acquisition ($1.2 billion or 75% of $1.6 billion). This issue warrants further investigation.

Number of official sources

5

Number of total sources

13