China Offshore Enters Canadian Sector

China's oil major CNOOC entered Canadian oil sands sector, acquiring nearly 17 per cent of private MEG Energy Corp. for $150 million.

Calgary-based MEG has a large land base in northeastern Alberta with an estimated two billion barrels of recoverable bitumen in place.

Six-year-old MEG intends to start building a pilot project using steam-assisted technology to melt the tar-like bitumen deep underground before pumping the heavy oil to the surface. Through incremental expansions, the company hopes to be producing 22,000 barrels per day by 2008.

Yang Hua, CNOOC chief financial officer said, ''I am excited with our low cost entry into oil sands, gaining a footstep in this potential area.?