China Petrochemical Corporation (Sinopec Group), China's largest oil company, announced it has closed a $680 million deal with Chevron to join a deepwater natural gas project off East Kalimantan, Indonesia.

The agreement, signed in Singapore Tuesday, will enable Sinopec to take an 18 percent stake in each of the project's three deepwater blocks – Rapak, Ganal and the Makassar Strait.

The three blocks are expected to yield 2.5-2.65 million tons of oil from 2015-2016, including 2.3 billion cubic meters of natural gas.

The deal, which is the latest example of China'efforts to source overseas energy, is still subject to regulatory approval of Indonesia and China.

In addition, Chevron and Sinopec may sign an accord by the end of the year to develop shale gas in China's southwestern region.

Several days ago, China National Offshore Oil Corporation's joint venture in Argentina paid BP $7.06 billion for its 60 percent stake in Pan Americana to take full control of the country's second largest oil and gas producer.