2010-06-30 16:46

China National Petroleum Corp (CNPC) signed a strategic cooperation agreement with China Resources Group Co (CRC), the?Shanghai Securities News reported Wednesday.

The two companies pledged to become partners in city gas supply, oil distribution, gas-powered electricity generation, engineering construction and overseas investment projects, according to the agreement.

"The strategic agreement between CNPC and CRC marked a new stage for the two companies' cooperation," said Jiang Jiemin, CNPC's general manager.

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Observers said the formal agreement indicated that the two giants in the upstream and downstream gas industry had successfully formed an alliance to jointly develop the urban city gas supply market in the future. Their cooperation might change the current gas market structure and impose pressures on other domestic gas distributors, the report said.

CNPC is the largest gas producer in China. CRC has powerful distribution networks in Chengdu, Fuyang, Huaibei, Linhai, Suzhou and Wuxi. CRD also operates liquefied natural gas stations in Chengdu, Nanjing and Wuxi.