StatoilHydro, CNOOC to Shutdown Lufeng Oil Field in South China Sea

After more than 11 years in production, StatoilHydro and Chinese National Offshore Oil Company (CNOOC) have reached a mutual agreement to transfer full responsibility for the abandonment of the Lufeng field in the South China Sea to CNOOC.

The transfer will take effect after the production shutdown later this year.

Lufeng 22-1 lies some 250 kilometers southeast of Hong Kong. Lufeng 22-1 was first discovered in 1983 by Occidental. Ampolex took over in 1991 and sold its interests to Statoil in 1996. The field was brought on stream in 1997. By the agreement, StatoilHydro will hand over its 75% interest in Lufeng 22-1 to CNOOC.

Lufeng originally planned to produce 25 million barrels of oil, but exceeded a total of 42 million barrels by year end 2008. Production was originally scheduled to shut down in 2004.

"Lufeng is a StatoilHydro success story," said Torgeir Kydland, head of INT Eurasia, Middle East and Asia.

"It is our first international operatorship and ended up producing far beyond our original expectations. This is an example of good cooperation between a national oil company and StatoilHydro. The agreement on transfer of responsibility for the abandonment is an important milestone for both companies, enabling us to devote more attention to future growth opportunities with CNOOC."


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