In a press release issued in the early hours of June 24, 2005, US time, Fu Chengyu, Chairman and CEO of China National Offshore Oil Corporation (CNOOC) (New York Stock Exchange symbol: CEO), said that he was "extremely pleased" that El Segundo, California-based Unocal had indicated that "they will begin engaging in talks concerning our all cash offer."

The CEO of CEO listed the reasons he believes make the acquisition of this American oil company by China's number three oil company (after PetroChina and Sinopec) makes more sense for Unocal shareholders than does going with a previously-agreed plan to sell the company to Chevron, largely for stock.

Pointing out that "70 percent of Unocal's current reserves are located in Asia," Chairman Fu offers reassurance, saying that "substantially all of the oil and gas produced by Unocal in the U.S. will continue to be sold in the U.S."

He goes on to say that "the development of properties in the Gulf of Mexico will provide further supplies of oil and gas for American markets."

In addition to offering more money, and a higher proportion of it in cash, than the competing Chevron bid, Chairman Fu makes the case that a Chinese acquisition would be better for current Unocal employees than a Chevron takeover, saying:

"I want to re-emphasize our commitment to retain the jobs of substantially all of Unocal's employees, as opposed to Chevron's plan to lay off employees, especially in the United States."

Offering further reassurance on the issue of a foreign takeover of a U.S.-based multinational company, Chairman Fu states that CNOOC is "fully prepared to participate in a CFIUS (Committee on Foreign Investment in the U.S.) review of the transaction and we have proactively made assurances to Unocal to address concerns relating to energy security and ownership of Unocal assets located in the United States."

Chairman Fu concludes his remarks by saying that:

"We are prepared to enter into talks with the CFIUS committee to discuss these issues as soon as the committee is ready to do so."

Unmentioned in this statement is the impact on U.S. energy consumers and on U.S. national security of the transfer of control of Unocal energy assets in Asia to an Asia-based company, and one largely under the control of the Chinese government.

To access this press release in its entirety, click here.

For more about CNOOC's $18.5 billion bid for Unocal, click here.