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Chinese Oil Consortium Acquires Ecuadoran Oil Field


19 September 2005

A consortium of state-owned Chinese petroleum companies has bought the oil and pipeline interests of Canada's EnCana Corporation in Ecuador.

Andes Petroleum Company - a group led by the China National Petroleum Company - paid nearly $1.5 billion for the assets, which include an oil field with 143 million barrels of proven reserves.

China has been snapping up oil and gas interests around the world to help fuel its fast-growing economy.

The latest official statistics from China show the economy continues to soar, despite government efforts to cool it down. China's fixed asset investments grew nearly 30 percent in August from a year ago, and industrial output increased 16 percent in August. Inflation has slowed, though, to one-point-three percent last month, from one-point-eight percent in July.

While most Asian economies are expecting higher inflation because of record oil prices, subsidies are so far shielding Chinese consumers from paying more for their fuel.

The Hong Kong-listed clothing retailer Esprit Holdings says profit jumped 67 percent, to $430 million, for the year ending in June. Chief Financial Officer John Poon says Europe was the key.

"Although Germany is still our core market, it represented 48 percent of the group's total turnover year on year," he said. "However, the rest of Europe, which now represents 37 percent of the group total turnover, achieved a year-on-year growth of 39 percent, which contributes about half of the 26 percent of increase in turnover."

Sales in Asia, which represent only nine percent of the group's total revenue, grew 21 percent.

The company, which was founded in California in the 1960's, wants to rebuild its presence in the United States, and is planning to open new branches there selling women's clothing.

In Australia, Parliament after much debate has voted to sell the government's controlling stake in the telecommunications giant Telstra. Politicians were worried that residents of the remote Australian outback would lose services once Telstra was privatized. The government stands to earn some $23 billion from the sale, which is expected next year.

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