CNOOC Limited Achieves Record Q1 Results

CNOOC announced its financial results for the first quarter created a new record again. The Company's unaudited total revenue hit RMB 16.66 billion, a 45.1 % surge from the same period last year. Reported total net daily production for the Company was 450,463 BOE, a YOY increase of 9.5%.

For the first quarter of 2006, crude oil and liquids production of CNOOC Limited reached 383,519 barrels per day and gas production 390 million cubic feet per day. The Company also reported an 11% increase of its net production offshore China, which was 415,144 BOE per day. In this period, strong production growth in Bohai Bay contributed prominently to the increase of the Company's total production offshore China. The net production in Bohai Bay realized increases of 23.4% for crude oil and 28.2% for natural gas.

Total unaudited revenue amounted to RMB 16.66 billion for the first quarter of 2006, among which oil and gas revenue rose to RMB16.43 billion, representing a 43.8% YOY increase.

In the first quarter, the Company realized an average oil price of US$ 58.13 per barrel or 39.3% increase over the same period last year; The average realized gas price was US$ 3.10 per thousand cubic feet or 6% up YOY.

The Company also made great progress in overseas activities. In the first quarter, the Company acquired 45% interests of OML130 and 35% interests of OPL229 Block in Nigeria. The above acquisitions have laid solid resource base for the Company's medium to long term overseas reserves and production growth, and have indicated the Company's prudent overseas M&A strategy.

Mr. Yang Hua, Chief Financial Officer and Executive Vice President of the Company commented: "CNOOC Ltd harvested the season thanks to the higher realized oil price and stable production growth."

Reflecting active exploration activities, the Company spent RMB 430 million of exploration capex in this period, up 23.7% from the same period last year. The Company made three new discoveries offshore China: Bozhong28-2S, Bozhong29-4 and Qikou18-2E. The relatively high success rate of exploration sees optimistic prospect offshore China.

"In the first quarter, the Company proceeded well in operating activities and HSE performance. We are very confident to achieve our planned production targets of 2006," Commented Mr. Zhou Shouwei, President of the Company.

Mr. Fu Chengyu, Chairman and Chief Executive Officer of the Company commented, "The Company's record high results in first quarter include not only Company's total revenue, but also other extraordinary progresses, especially activities of overseas business and exploration offshore China. It will further enhance our capability to pursue long term growth."