"At this time, I'm not aware of any other proposal received by management, advisers or the board of directors," PetroKazakhstan president and chief executive officer Bernard Isautier told investors during a conference call on Monday.

The Canadian owned company, formerly known as Hurricane Hydrocarbons, cannot solicit new bids, but may yet accept a competing offer, he said.

 

Should PetroKazakhstan investors go with a higher bid, the company must pay CNPC $125 million. CNPC also has the right to match any new offers, Isautier said.

 

Bidding war

On Monday, Indian state-run Oil and Natural Gas Corporation (ONGC) said it would make a counter-offer if asked.

 

Any bidding war would pit the world's two fastest-growing consumers of oil in a battle for resources both will need in ever-increasing amounts in coming years, as their economies and their populations continue to surge.

Analysts said the price CNPC was offering was steep, particularly for a set of assets said to be past their prime, but at the same time understandable given China's growing thirst for fuel.

 

"It's a very high price but this is a strategic investment. Finally, it's reserves that you can bring to China.

Stephen O'Sullivan, oil analyst, United Financial Group

The deal would give CNPC access to PetroKazakhstan's 150,000 barrels per day of production - a small fraction of China's 6 million barrels per day of consumption but a step nonetheless for the world's second-largest oil-consuming nation.

"It's a very high price but this is a strategic investment. Finally, it's reserves that you can bring to China," said Stephen O'Sullivan, oil analyst at United Financial Group in Moscow.

 

It would be China's first successful takeover of a foreign-listed energy firm.

 

ONGC is India's top exploration company, while CNPC's PetroChina unit is China's top oil producer.

 

Boards approve

The CNPC offer has been approved by the boards of both companies, but is subject to approval by two thirds of votes cast by PetroKazakhstan shareholders at a meeting to be held in October, the same month the transaction is expected to close, the company said in a statement.

 

The deal amounts to $55 per share and represents a premium of 24.4% on the price of PetroKazakhstan shares in New York over the 20 most recent trading days.

 

"The board of directors has determined that the transaction is in the best interest of the shareholders," he said.

 

The deal for PetroKazakhstan comes amid growing energy demand in China and follows an unsuccessful $18.5 billion bid earlier this month by China National Overseas Oil Corporation to buy the US-based Unocal.