China's top offshore oil and gas producer China National Offshore Oil Corp Limited (CNOOC) said yesterday it had completed a deal to buy a share of a Nigerian oil mining licence in its biggest-ever overseas acquisition.

The Beijing-based oil company bought a 45 per cent stake in Nigeria's OML 130 oil area also known as the Akpo deposit  from privately owned Nigerian firm South Atlantic Petroleum Ltd, CNOOC said in a statement.

In January it said it would pay US$2.27 billion in cash for the stake, but in yesterday's announcement it said it was paying an additional US$424 million for financial, operating and capital expenses.

"The completion of this transaction represents a milestone in our efforts to expand into the world's most prolific oil and gas basins," Chairman Fu Chengyu said.

The Akpo field, about 200 kilometres off the coast of Port Harcourt, will be able to pump 225,000 barrels a day of oil after it comes on stream in 2008, or 9 per cent of Nigeria's current production, according to operator Total SA.

CNOOC has said it would contribute more than US$2 billion to develop the field.

Last year, the firm offered US$18.5 billion for California-based Unocal, but withdrew its bid in August amid political opposition in the United States which said the multi-billion takeover would threaten the country's energy security.

CNOOC's shares have risen 24 per cent since it announced the Nigeria purchase on January 9, outperforming the 8.3 per cent gain in the benchmark Hang Seng Index.

It made a 2.2 per cent gain yesterday on the Hong Kong Stock Exchange to close at HK$6.85 (88 US cents).

The company on Wednesday said it would invest about 100 billion yuan (US$12.3 billion) over the next five years to speed up deepwater drilling along the coast of China and increase output.

The overseas-listed oil firm plans to strengthen partnerships with foreign companies and also  develop its own technologies in deepwater oil and gas development, said Tan Dongling, a development and planning manager at CNOOC.

By 2010, more than 50 new gas and oil fields will be completed and put into production, Xinhua quoted Tan as saying.

The new fields, 24 of which are under construction and 13 being assessed for development, are mainly located in East China's Bohai Sea, the Pearl River estuary and the Beibu Gulf in the South China Sea, said Tan.

CNOOC on Wednesday announced that its new gas field in the eastern part of the South China Sea had started operating.

The field, Huizhou 21-1, is producing 54 million cubic metres of natural gas per day, the firm said. CNOOC holds a 51 per cent stake in it.

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