Oil giant BP to raise $1bn in PetroChina stake sale

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BP is set to net a profit of about $1bn (£541m) on its investment in China's biggest oil producer PetroChina by selling its 2 per cent stake.

The UK company, now the world's second-biggest oil company following Shell's drop in value last week, said it remained committed to China as a whole, however, and expected to invest a further $3bn in the country over the next five years.

BP's stake in PetroChina, acquired when the business was floated on the international markets four years ago, has proved controversial because of the company's plans to build a pipeline across Tibet.

BP's 3.5 billion PetroChina shares were placed by Goldman Sachs. BP also owns a stake of just over 2 per cent in another privatised Chinese oil company, Sinopec, which it is likely to sell. A spokesman said the shareholding was under review but no decision had been taken to divest the shares.

BP has teamed up with PetroChina to develop a chain of 500 petrol stations in the Guangdong province but a spokesman stressed it had no involvement in the Tibetan pipeline. BP is also talking with PetroChina about building a pipeline to import gas into the country from the Kovykta field in Russia, owned by the TNK-BP joint venture.

Other big investment projects in China in which BP is involved includea petrochemical complex in Shanghai.