In
2013, in order to further enhance strength of upstream business, Sinopec Group
planned to purchase partial shares of CIR, Mansarovar and Taihu into Sinopec
Corp.
With
assets distributed in Kazakhstan, CIR holds shares in four joint ventures and
owns 5 oil fields in production; Mansarovar, with assets distributed in
Columbia, enjoys rights in blocks of Nare and Velasquez as agreed in contracts;
Taihu holds 97.14% shares in UDM who currently owns 28 oil fields in Volga of
Russia. Total reserve of the aforesaid oil and gas assets amounts over 600
million barrels.
CEA provided
professional asset appraisal service for the aforesaid economic behaviors. The
appraisal base date is December 31, 2012. Appraisal on the project shows the
following features: (1) Assets under appraisal are distributed overseas and
large amount of materials is in foreign language (English, Russian and
Spanish). So it is quite hard to collect materials, communicate and carry out
appraisal procedure; (2) oil and gas assets raise high requirements on
professional ability; (3) transaction structure is complicated and reorganization
scheme was adjusted constantly; (4) time is very limited. With consideration of
these features, China Enterprise Appraisals adopted income approach for this
appraisal and gained in-depth knowledge about and compared relevant income
parameters. The design of income approach model was recognized by international
investment banks (Goldman Sachs and UBS) and well received by Sinopec and
relevant agencies.
