SAPET Development Peru Inc., a 50-50 joint venture between CNPC (Hong Kong) and its parent, has entered into concession agreements with the Peruvian government to explore, develop and produce crude oil and natural gas in two zones in the southeastern region of Madre de Dios, covering a total area of 27,500 square kilometers. The total exploration costs for the initial term of seven years will be US$31.6 million, which will be shouldered by SAPET Peru, CNPC (Hong Kong) said. During the initial term, SAPET Peru will carry out geological studies to gather and interpret data related to the drilling of exploration wells. CNPC (Hong Kong) said it cannot provide details on the estimated reserves of the zones as it hasn't started exploration work. SAPET Peru already has an interest to explore and produce oil and gas in two blocks of the Talara Oilfield in northwest Peru. China has been looking for new oil and gas reserves domestically and internationally, both onshore and offshore, as the country has been a net crude oil importer since 1993. China National Petroleum Corp. is also the parent company of PetroChina Co. (PTR), China's largest integrated oil firm by capacity. PIN/ DOW JONES