China has sold the rights to explore three oil and gas exploration blocks in the restive western region of Xinjiang for fees worth more than RMB 2.7 billion ($422 million), Reuters reports, citing an article by Xinhua.
Shenergy Co, Xinjiang Energy (Group) Co and Zhongman Petroleum and Natural Gas Group Corp (ZPEC) were the firms to secure the contracts, after a bidding process that attracted seven companies.
Beijing has been actively looking to diversify the country’s oil and gas sector and break the stranglehold of the large state-owned companies in order to encourage more private investment in exploration for new deposits, according to Reuters. Xinjiang, a remote but hydrocarbon-rich province in China’s far west, is set to be a test case for the government’s new approach.
The three blocks in Xinjiang’s Tarim basin were among five that the government put up for auction in December 2017, which cover a combined 9,091 square km (3,510 square miles).