CHINA National Petroleum Corp, the parent of PetroChina, agreed to develop coal seam gas (CSG) resources at Sha Erhu block at Tuha basin in Xinjiang Uygur Autonomous Region with BP Plc.

The two companies have completed a preliminary assessment of the coal seam gas resources in the region and agreed on budget, staff and drilling requirements, CNPC said yesterday.

PetroChina and BP cooperate in several business areas including petrol station operations in the southern province of Guangdong via a joint venture. They have also won a joint bid to develop the Rumaila field, the largest oil project in Iraq.