CNOOC, KUFPEC Ink PSCs for 3 Offshore Blocks in South China Sea
CNOOC Limited announced Wednesday that its parent company, China National Offshore Oil Corporation (CNOOC), has signed three production sharing contracts (PSCs) with KUFPEC (China) Inc. (KUFPEC) for Blocks 52/22, 52/26 and 63/13 in the South China Sea.
The three blocks mentioned above are located in the Yinggehai Basin of the South China Sea. Block 52/22 covers a total area of 732 square miles (1,896 square kilometers), and has a water depth of 196-984 feet (60-300 meters); Block 52/26 covers a total area of 688 square miles (1,783 square kilometers), and has a water depth of 262-524 feet (80-160 meters); Block 63/13 covers a total area of 269 square miles (698 square kilometers), and has a water depth of 262-459 (80-140 meters).
According to the terms of the PSCs, CNOOC shall act as the operator of the three blocks mentioned above. Expenditures incurred during the exploration period will be borne by CNOOC and KUFPEC in a proportion of 20 percent and 80 percent of participating interest, respectively. Both parties will conduct 3D seismic data surveys and will drill exploration wells. Once entering the development phase, CNOOC has the right to participate in up to 70 percent of the working interest in any commercial discoveries in the blocks. After signing the abovementioned PSCs, CNOOC will assign all of its rights and obligations under such contracts, except for those relating to CNOOC’s administrative functions, to CNOOC China Limited, a subsidiary of CNOOC Limited.
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