Ivanhoe Energy sells China block to MIE for $45m

by on November 21, 2012 3:52 pm BST

Hong Kong-listed
MIE, which holds assets in China, the United States and Kazakhstan, will gain
100% of the foreign contractor’s rights at Petrochina’s Dagang production sharing
contract in Hebei province, eastern China under the deal.

The block held 2.5 million barrels of proven and probable
reserves as of 31 December 2011, according to GLJ Petroleum Consultants, with
production running to between 800 and 900 barrels per day.

Toronto- and
Nasdaq-listed, Calgary-based Ivanhoe Energy said it was offloading the
asset as part of a drive to focus resources on patented technologies and
high-growth potential heavy oil assets like its domestic Tamarack project and
Block 20 in Ecuador.

It also wants to sell its other Chinese block Zitong in Sichuan province, which
it gained in 2009 in a merger with PanAsian Petroleum.

MIE said it was buying a low-risk, oil-producing asset that
would add to its China-focused portfolio which it claims is the largest independent
onshore asset base in the country.

Wednesday’s deal is expected to close within a month’s time.