China National Offshore Oil Corp. Ltd. (CNOOC) posted a 6.8 percent increase in net oil and gas production to 211.6 million barrels of oil equivalent (MMboe) in the first half of this year (1H 2014), up from 198.1 MMboe from a year ago, with 36.3 MMboe contributed by its Canadian subsidiary Nexen.
Higher net petroleum production and increase in realized oil and gas prices in 1H 2014 lifted CNOOC's revenue by 5.7 percent to $19 billion (CNY 117.1 billion) although net profit declined 2.3 percent to $5.46 billion (CNY 33.59 billion) as the firm's all-in cost rose 2 percent to $43.20 per barrel of oil equivalent. This included operating cost of $11.78 per barrel of oil equivalent, which was 7 percent more than last year.
On its 2014 production target, CNOOC maintains that there will be no change from the planned 422-435 MMboe.
Turning to exploration, CNOOC made 9 new discoveries and drilled 23 successful appraisal wells in 1H 2014, including Lingshui 17-2 which was discovered by Hai Yang Shi You 981 (UDW semisub) and is set to become the first large-sized deepwater gas field made by the firm.
CNOOC added that Luda 16-3 South structure is expected to become a mid-sized discovery after appraisal. Kenli 3-2 oilfields, Panyu10-2/5/8 project and Wenchang 13-6 oilfield have commenced production according to schedule while other projects are progressing as planned.
Development continues at Panyu 34-1/35-1/35-2 project in the Eastern South China Sea, with mechanical work completed, while offshore installation is underway at Qinhuangdao 32-6 adjustment in Bohai Bay and at Enping 24-2 in the Eastern South China Sea. Meanwhile, offshore hook-up has begun at the Golden Eagle project in UK North Sea.
“During the first half of 2014, we have actively pushed ahead different areas of our business. Good progress was made in the production and operation and a healthy financial position was maintained. In the second half of the year, we will continue to work diligently to ensure that we meet our annual production and business targets,” Li Fanrong, CEO of CNOOC said in a press release Thursday.
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