Asia's largest refiner, China Petroleum Corp, had agreed to shell out USD3.1 billion for a 33% stake in the oil and gas business of Houston based Apache Corp located in Egypt. This purchase stands as the largest one yet by the Chinese state owned firm in the Middle East.

The purchase would increase Sinopec's annual production by nearly 9% according to calculations done by Bloomberg. The location of the refinery is far from the areas of political unrest in the country far deep into the Western Desert. This coincides with PetroChina Co's move into Iraq, a clear signal that the Chinese are increasing its investments in the energy sector of the Middle East.

According to Wei Fujun, spokesperson for Sinopec International Petroleum Exploration and Production Corp, the unit spearheading the Apache Corp purchase, they are fully aware of the political uncertainties in Egypt. He said that the company is focused on the long-term development in the region, calling the USD3.1 billion purchase as 'very reasonable'.

The new company would be known as Apache and Sinopec Group and would be based out of Beijing. Part of its overall thrust would be to form global partnerships in developing oil and gas projects where Apache would be the operator.