Qatari investors to pay $5B for 49 pct of Chinese firm

Qatar's Qatra for Investment & Development (QID Group) and Hamad Bin Suhaim Enterprises have signed an initial deal to acquire 49 percent of China's Shandong Dongming Petrochemical Group worth $5 billion, executives from the firms said on Monday. The deal is expected to be finalised by the forth quarter of this year, with the cash used to finance a number of projects that Shandong is currently working on, Ibrahim El-Tinay, chief executive of QID, told reporters at a press conference in Doha. "These projects will include building 1,000 petrol stations across six provinces in China and a liquefied natural gas (LNG) terminal with a 3 million ton per annum capacity in the region of Qinzhou," he said. Once the acquisition deal is finalised then completion dates for these projects will be set, El-Tinay added. How the $5 billion investment would be split between the two Qatari investors was not disclosed. The stations will be built in a 300-kilometre radius of the company's Heze refinery in Shandong province in eastern China, which would provide a third of its output as supply to the stations, according to a joint statement from the three parties. The LNG terminal will be built in the municipal region of Qinzhou in southern China and will include the construction of a terminal, jetty, regasification facilities and storage. "Following the construction of this terminal, we hope that Qatar will have the priority in providing it with supplies," El-Tinay added. China's natural gas demand grew by 5.6 percent last year to 178.6 billion cubic metres (bcm). Of that demand, 127.9 bcm was supplied by domestic sources, while 57.8 bcm was imported by pipeline or as LNG.