CNOOC will buy a 50% stake in China United Coalbed Methane, it said today.
A signing ceremony for the deal would be held later today, industry sources with direct knowledge of the deal told Reuters.
China United Coalbed Methane has 27 CBM blocks with proven reserves of around 50 billion cubic metres, they said.
China National Coal Group, the parent of China Coal Energy, which owns all of China United Coalbed Methane, would hold the other half of the company after the deal, they said.
Earlier this month, CNOOC said it would acquire 50% of the exploration rights in five Australian CBM blocks owned by Exoma Energy for A$50 million (US$50.46 million), marking its second foray into Australia's unconventional gas market.
In March, CNOOC agreed to buy 3.6 million tonnes of liquefied natural gas per year for 20 years from BG Group's Curtis Island plant, in Queensland, which will use CBM as feedstock. It said it would take equity stakes in the gas reserves and production facilities.
CNOOC had previously said that it was looking to expand its CBM business and that it was considering using unconventional gas resources in the northern province of Shanxi to supply regional clients in the form of pipeline gas, compressed natural gas, or LNG.
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