HOUSTON, Aug. 30 (UPI) -- Apache Corp. of the United States announced China's Sinopec Group will acquire a 33 percent interest in its oil and gas business in Egypt for $3.1 billion cash.
Apache, an independent oil and gas company with headquarters in Houston, said on its website the sale is part of the companies' agreement to launch a global strategic partnership to pursue joint upstream oil and gas projects.
"As the first step in this partnership, Apache will receive $3.1 billion in cash, subject to customary closing adjustments, in exchange for Sinopec gaining a 33 percent minority participation in Apache's Egypt oil and gas business," the company said. The deal is expected to close in the fourth quarter.
The announcement said Apache will continue to operate its Egypt oil and gas business.
Apache Chairman and CEO G. Steven Farris said Sinopec's technical expertise "complements our 20 years of experience operating in Egypt."
Sinopec, China's leading oil and gas producer formerly called China Chemical and Petroleum Co., has been making deals around the world to help meet China's growing demand for energy, The New York Times reported.
The deal, when concluded, will enable Sinopec to expand output by an estimated 6.5 million tons of oil each year and will mark the company's debut in the Egyptian oil and gas market, the Xinhua News Agency reported.
Apache said net production from its Egypt operations averaged 100,000 barrels of oil and 354 million cubic feet of natural gas per day in 2012.
The Times said the sale comes after a number of acquisitions by Apache in the past three years at a cost of more than $15 billion. The company says it is refocusing on its North American onshore holdings.