China Petroleum & Chemical Corp (Sinopec) may buy more of its parent China Petrochemical Corp's overseas oil and gas assets to offset the relatively weak performance of its domestic fields and deteriorating refining profits owing to fuel price controls and excess industry capacity. Sinopec chairman Su Shulin made the comment a day after the company, Asia's largest oil refiner, unveiled a US$2.46 billion acquisition of a 27.5 per cent interest in an oil field 150km offshore from the African nation of Angola from its parent. The purchase, pending shareholder approval in May, would raise Sinopec's oil production by 24 million barrels or 8 per cent this year. Without it, Sinopec's planned oil output for this year is 301.2 million barrels, stagnant from last year. The deal would also increase Sinopec's proven oil reserves by 102 million barrels, or 3.6 per cent, from 2.82 billion barrels at the end of last year. 'In the future, we will further assess our parent's overseas assets [for suitability to be injected into Sinopec],' Su said. China Petrochemical last year added about 803 million barrels of new oil and gas reserves abroad. Total overseas output, based on its shareholding, was projected to surge to about 125.56 million barrels this year - including that from the Angolan field - up from 93.37 million barrels last year, Su said. Sinopec executive director Wang Zhigang said the field's output was expected to peak this year and remain stable until 2013, after which it would start to decline, although partly offset by development of potential resources in the neighbouring areas, which could add up to 48 million barrels of reserves. Sinopec's natural gas output this year will also be boosted by the start-up of a giant field in Sichuan province, which was delayed by an earthquake. The firm plans to produce 12 billion cubic metres this year, up from 8.47 billion cubic metres last year. Despite this year's output growth, Sanford Bernstein Securities senior analyst Neil Beveridge wrote in a research note that the company's domestic oil and gas business was becoming increasingly mature and its refining business expected to be weak. Its proven oil and gas reserves fell 1.4 per cent to 3.94 billion barrels of oil equivalent, as newly added reserves could not make up for lost reserves from production. Sinopec's refining operating profit dropped to 1.52 billion yuan in the fourth quarter of last year from 1.66 billion yuan in the third quarter and 19.9 billion yuan in the first half. It was marginally profitable in the first quarter of this year, with a gross margin of less than US$4 a barrel, as higher crude oil prices were not reflected by fuel price increases. The company is also expected to face pressure in its chemical segment this year, as the start-up of three major plants will see its total output of ethylene surge 29 per cent to 8.69 million tonnes. The segment posted a 690 million yuan operating loss in the fourth quarter of last year, compared with 4.55 billion yuan profit in the third quarter. President Wang Tianpu said the loss was due to asset write-downs, adding that strong demand would help offset rapidly rising supply.