CNOOC Reports Strong 3rd Quarter Results

CNOOC Limited announced a 56.5% increase in unaudited oil and gas revenues of RMB 6.79 billion for the third quarter of 2002, compared to revenues of RMB 4.34 billion during the same quarter of 2001. For the nine months ended September 30, 2002, oil and gas revenues were RMB 16.42 billion, compared to RMB 13.90 billion during the same period last year, an 18.1% increase year-over-year.

Underpinned by continued strong domestic demand in China and results from the Company's Indonesian assets, the Company's experienced total production of 382,409 barrels of oil equivalent (boe) per day in the third quarter, a 47.0% increase over the prior-year period. In the first nine months, total production grew 27.4% year-over-year to 332,634 boe per day. In Bohai Bay, crude oil production experienced another strong quarter, posting a 24.2% increase over the prior-year period and a 31.3% year-over-year increase in the first nine months.

The company realized an average price of US$25.21 per barrel for crude oil during the quarter and US$22.82 during the first nine months, compared to US$24.59 and US$25.43 for the prior-year periods, respectively. Average realized price for natural gas was US$3.19 per thousand cubic feet during the quarter and US$3.14 for the first nine months.

"Buoyed by higher commodity prices, strong production growth, and continued execution of our low cost operating strategy, the Company has performed extremely well during the quarter," said Mr. Zhou Shouwei, President of CNOOC Ltd. "The Company's strong financial and operating performance over the years coupled with the current oil price environment have placed the Company in an enviable financial position to comfortably fund current and future investments that will contribute to the Company's continued growth."

The Company has made strong progress in its active exploration and development program. During the first nine months, the Company and its PSC partners have completed drilling more than 75% of the wells planned for the year. Of the 55 wells drilled during the first nine months, 39 were completed independently. Furthermore, the Company and its partners have an overall 47.2% exploration success rate during the first nine months. During this period, the Company achieved certain development milestones. WC 13-1, WC 13-2, and QHD 32-6 C/D well head platforms came on stream and PL 19-3 Phase I is on track to come on stream by the end of the year.

Reflecting increased exploration and development activity, the Company's exploration capital expenditures increased 135.2% year-over-year to RMB 1.37 billion and development capital expenditures increased 8.0% year-over-year to RMB 3.70 billion.