HOUSTON -- ConocoPhillips said Monday it has reached an agreement with Chinese regulators to resolve all pending governmental claims related to oil spills that occurred in June in Bohai Bay, off the northeastern part of the country.
Under the agreement, ConocoPhillips will pay $173 million to the Chinese State Oceanic Administration over the next two years and will also contribute $18 million by December 2014 toward social projects benefiting Bohai Bay, the company said in a press release.
The agreement also provides that the China National Offshore Oil Corp., CNOOC, will contribute $76 million toward such projects. The initial programs will focus on improving marine environment protection and reducing pollutants in the bay, the company said.
Following a partial shutdown last summer, the Chinese government in early September ordered a complete halt in production at the field, known as Peng Lai 19-3, which produced an average 56,000 barrels a day in 2010.
In two accidents in June, more than 3,000 barrels of oil and mud used in drilling leaked through the seafloor near platforms at the field, operated by Conoco and 51 percent owned by Cnooc's listed unit Cnooc Ltd.
Conoco said it continues to work with CNOOC to meet the requirements of relevant government agencies to permit the field to return to normal operations.
Copyright (c) 2012 Dow Jones & Company, Inc.
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