China ready to snap up BP's Latin American assets

CHINA'S largest offshore oil producer, CNOOC, might bid for BP's stake in Pan American Energy (PAE) if the British company sold it to raise money to cover its Gulf of Mexico oil spill costs.

BP plans to sell assets worth up to $30 billion (19bn) to pay for the worst oil spill in US history. It has said it would sell holdings in Colombia, Canada Egypt, Pakistan and Vietnam.

Its stake in PAE is one of the company's most prized Latin American assets. Investment in energy output and exploration has lagged in Argentina, but PAE's reserves and output have risen in the past decade and Argentine analysts say the country's number two energy firm could be worth up to $20bn.

BP has a 60 per cent stake in PAE and Argentina's Bridas holds the rest. CNOOC bought half of Bridas for $3.1bn in March.

Industry sources say PAE is one of the assets BP has considered selling because it is less important than other assets, though its reserves and output are growing.