CNOOC and CPC Form Exploration JV
CNOOC and Taiwan's Chinese Petroleum Corp (CPC) plan to sign the first contract to explore jointly for oil in the Taiwan Strait in January. CNOOC concluded negotiations at the end of October for the 50/50 production sharing contract to explore and produce oil in the Chaoshan block, approximately 155 miles west of the Taiwan port of Kaohsiung.
If approved, the deal will bring closer economic ties between China and Taiwan. CNOOC and CPC are expected to set up a joint venture to operate the Chaoshan block and drill two to three exploration wells. The deal followed a successful geophysical survey of the 15,400 square km block which started in 1996.
During the recent talks, the companies inked a preliminary pact for a broad cooperation in areas including refining and exploration for overseas oil production. The two sides also agreed to exchange data on hydrocarbon reserves in the Taiwan Strait, but have yet to decide on further cooperation such as conducting geophysical surveys.