Barred from exploring for oil at home, a consortium of private mainland companies had secured six fields abroad for the first time - four in Indonesia and two in the Middle East - for US$400 million, industry sources said yesterday. The China International Petroleum Investment Union was set up in August last year by 50 mainland companies with an investment of US$300 million, with some of the funds from the Middle East. Oil exploration in China is restricted to state firms with private firms limited to retailing, distribution and small-scale refining. The union, whose members have assets totalling 20 billion yuan, has a charter calling for a policy of 'exchanging oil resources for shares'. It is inviting oil producers to take a stake in the consortium by offering oilfields. It wants international strategic investors to help realise major investment projects and establish foreign production bases. It also aims to raise money on international markets, in the form of share issues and fund placement. The union plans to set up offices in Hong Kong, the United States, Russia, Singapore, Indonesia and other Organisation of Petroleum Exporting Countries to pursue its objectives. Last year, China imported 127 million tonnes of oil, 40 per cent of domestic demand. In the first quarter of this year, it imported 37.1 million tonnes, 25 per cent more than a year earlier, with the cost soaring 75 per cent to US$16 billion. By 2010, its import dependence will reach 50 per cent. Beijing is encouraging the union to secure foreign oil resources but is refusing to open the exploration and development of oil at home to private companies, in part because of the formidable lobbying power of the three giant state oil enterprises. The private sector argues that the failure last year of CNOOC to buy US oil firm Unocal Corp is evidence that Chinese firms are sometimes handicapped by their state ownership. In June last year, more than 30 private companies set up Great United Petroleum Holding in Beijing as the country's first private oil conglomerate.