Asia PR News

CALGARY and BEIJING, Oct. 27 /CNW-AsiaNet/ –

China National Petroleum Corporation’s (CNPC) acquisition of
PetroKazakhstan Inc. (PK), through its wholly-owned subsidiary CNPC
International (CNPCI), was successfully concluded today, after receiving formal
approval from the Court of Queen’s Bench, in Calgary, Alberta, yesterday.

On October 18, 2005, PK shareholders and proxy holders voted 99.04% in
favour of the transaction, clearing the way for CNPC to acquire 100% of the
assets of PK for US 55$ per share.

CNCP and PK announced an "Arrangement Agreement" outlining the proposed
transaction on August 22nd 2005. After two months of intense work, all formal
approvals and legal procedures have now been obtained and completed. CNPC
staff are ready to begin working with PK on the hand-over of business
operations. During the transition period, the operations of PK will continue
as usual and PK employees in Kazakhstan will be unaffected.

Since its first foray into Kazakhstan in 1997, CNPC, China’s largest oil
and gas producer and supplier, has strictly followed local laws and
regulations as well as international best practices for the industry. CNPC
continues to fulfill that commitment through the application of advanced and
proven technologies.

CNPC has developed good relationships with the Kazakhstan government. The
cooperative Aktobe project was hailed by Kazakh President Nazarbayev as the
"Model for Sino-Kazakhstan Economic Co-operation". Upon acquisition, and in
keeping with these good relations, CNPC will cooperate with KazMunaiGaz on the
operations and management of PetroKazakhstan. Both parties have come to an
understanding and have signed an MOU.

The MOU outlines an agreement whereby CNPC will sell 33% of the PK assets
for US$1.4 billion (US$55 per share) and also agrees to set up a joint venture
for the operation of the Shymkent Oil Refinery.

PetroKazakhstan owns 12 oil fields and exploration licenses in 6 blocks
in Kazakhstan, with great exploration potential. CNPC’s strength in capital,
technology and management, as well as experience in Kazakhstan, will be
leveraged to increase the production capacity of PK and provide a reliable
supply to the Sino-Kazakhstan pipeline to be completed by year end. The
increased investment in oil and gas in Kazakhstan and the acceleration of PK’s
development will play an active role in ensuring a stable supply of oil
products in Kazakhstan, and in promoting local economic development.

The success of CNPC’s acquisition of PK marks a milestone of CNPC’s
international development strategy, and ushers in a new era of cooperation
between China and Kazakhstan in the oil and gas sector.

SOURCE: China National Petroleum Corporation

CONTACT: Jeff Smith, Hill & Knowlton Toronto
(416) 457-4571 (cell), (416) 413-4731 (Friday October 28th)
jeff.smith@hillandknowlton.ca