Sinopec possibly to acquire overseas assets from parent company

Sinopec (NYSE:SNP; HK: 0386; SH: 600028) is possibly to take over overseas oilfield assets of its parent company to boost up its weak upstream segment, said Su Shulin, chairman of the company.

Upstream income has become an important profit source of Sinopec now, Su said.

As international crude oil price rose year by year, profitable upstream business could to some extent offset enlarged loss from its refining business, analysts said.

The move is also considered as the company's mulling over more capital expenditure on upstream development, after Su Shulin, former vice president in China's top oil/gas producer PetroChina (NYSE:PTR), appointed to be the new boss of Sinopec.

It is said that China's three oil giants, PetroChina, Sinopec and CNOOC (NYSE:CEO), sat on a table for a further cooperation talk in June. " We expect a win-win cooperation in the future, " Su said.

Sinopec Group owns equities in 74 blocks overseas, with 123 million tons of oil/gas equivalent reserve left. And the group plans to produce 7 million tons of equity crude oil this year.