China's top offshore oil and gas producer CNOOC Ltd said
yesterday it aimed to lay a solid foundation for robust long-term
growth beyond 2007, with several new projects to begin next
year.
"The company's overall production in 2007 will be flat at 162 to
170 million barrels oil equivalent (BOE) under the WTI crude oil
price of USUS$62.80," said Yang Hua, executive vice-president of
CNOOC, in Hong Kong yesterday.
"Although the production target for this year has not seen a
substantial year-on-year increase, it will lay the foundation for
several new projects, which will be put into operation in 2008 and
2009," Yang said.
The firm's production volume for 2006 is estimated at 165 to 168
million BOE. CNOOC said damage to its Liuhua oilfield facilities
caused by Typhoon Pearl last year was partly why it is expected to
pull up short of its 170 million BOE production target.
"Because of the damaged Liuhua field, the production target for
this year is not high. But with more projects coming on stream, I
can say that our output may reach 190 million barrel oil equivalent
for 2008, or even higher for 2009," Yang said.
Five CNOOC projects are scheduled to come on stream in 2007,
with 10-plus projects under construction. Its investment budget
will hit more than US$4 billion this year, while exploration costs
will reach US$512 million, according to Yang.
Most of the US$512 million exploration budget (75 percent) will
go to local projects, which can be categorized as mature, rolling
and frontier areas.
Major projects either on stream or in progress this year are
Penglai 19-3 phase two, Huizhou 25-4, SES gas phase two in
Indonesia, Wenchang oilfields and OML130 in Nigeria.
CNOOC's criteria for selecting and evaluating projects at home
and abroad are based on three key areas oil and gas reserves,
economic returns and risks, Yang said.
"The risks involved in the Nigeria project are acceptable,
because the operator is not CNOOC Ltd itself and the field is far
away from the continent," Yang added.
CNOOC's parent firm China National Offshore Oil Corp told
China Daily earlier that its priorities for 2007 will be the
construction of the refinery with 12 million tons of capacity,
exploration works in the Bohai Sea and South China Sea, the oil
sand program in Canada and liquefied natural gas (LNG) projects in
Shanghai Municipality and Fujian Province.
Offshore upstream field developer CNOOC is turning its attention
to the downstream segment of oil refining to enrich its business.
That is why it is pinning high hopes on the 12-million-ton refinery
project in Huizhou of Guangdong Province, according to an
independent oil analyst.
CNOOC is a Hong Kong-listed public company that engages
primarily in the exploration, development and production of crude
oil and natural gas offshore in China. Yang said yesterday that
CNOOC would not tap the oil product retail business in China.
(China Daily January 31, 2007)