(ATF) The China National Offshore Oil Corporation on Tuesday announced another large-scale oil and gas discovery in the Bohai sea, in the Bozhong 13-2 oil and gas field.
CNOOC said it has proven geological reserves of 100 million tonnes of oil and gas.
The Bozhong 13-2 oil and gas field is located in the central waters of the Bohai Sea, about 140 kilometers from Tianjin, a major port in northeastern China, just south of Beijing. The oil and gas field has an average water depth of about 23.2 metres, the Beijing Daily reported.
The discovery well Bozhong 13-2-2 encountered an oil layer with a thickness of about 346 metres and was completed at a depth of 5,223 metres.
After testing, the well produced about 300 tonnes of crude oil and 150,000 cubic metres of natural gas per day on average.
Zhou Xinhuai, general manager of CNOOC Exploration Department, said the discovery of the Bozhong 13-2 oil and gas field was important and valuable for future exploration of the same type of field in the area and other offshore locations.
CNOOC, which is one of the largest national oil companies in China, began to conduct oil and gas exploration in the depths of the Bohai Sea as early as half a century ago. After generations of effort drilling and searching for oil and gas, explorers continued to tackle key problems, until the group discovered Jinzhou 25-1 South and other high-level large and medium-sized oil fields.
In a bid to achieve an efficient conversion of reserves, the company has applied an integrated management model of exploration and development, using existing oilfield facilities to quickly promote the construction of well areas. Exploratory wells are directly converted into production wells for test production, to reduce drilling costs and increase the oil and gas yield.
Zhou Xinhuai said that during the 14th Five-Year Plan period, which began this year, CNOOC workers would continue to implement their development plan at the Bozhong 13-2 oil and gas field and become an important force for the Bohai Sea.
CNOOC 'targeting South China Sea and onshore sites'
CNOOC said early this month it would accelerate the exploration and development of natural gas, including deepwater reserves in the South China Sea and unconventional resources onshore China, to cut carbon emissions.
One of the industry's lowest-cost explorers and producers, CNOOC said net oil and gas output last year grew by 5% to 528 million barrels of oil equivalent (boe) and it aimed to raise 2021 output to 545-555 million boe.
It plans capital spending this year of 90-100 billion yuan (nearly $14 billion-$15.5 billion), the highest since 2014, as it prioritises domestic drilling and natural gas, which is less carbon intensive than oil.
With the aim of making gas 30% of its portfolio by 2025 and half by 2035, CNOOC will expedite large discoveries, such as Lingshui 17-2 in the South China Sea and Bozhong 19-6 in the Bohai Bay off north China.
It will also tap unconventional resources, including coal-seam gas, tight gas and shale gas in China.
"Bohai Bay has huge natural gas potential and our exploration at the South China Sea is only at early stage," CEO Xu Keqiang told reporters.
CNOOC will also consider acquiring gas assets outside China, Xu added.
Production from offshore China will account for about 68% of the 2021 target and overseas operations 32%, compared with the 64%-36% split seen in the previous two years, the company said.
Of 19 projects to commence operation this year, a stand-out is CNOOC's first major fully-owned deepwater gas field, Lingshui 17-2.
CNOOC in January started sailing Shenhai-1, a newly-commissioned deepwater oil and gas production and storage platform, to Lingshui. First output is expected late this year and annual output will reach more than 3 billion cubic metres.
The company has said 3%-5% of its total annual spending will be on offshore wind power, following the launch of its first wind power farm in east China last September and expansion planned in several other coastal provinces.
Asked about its fluctuating share prices following Washington's blacklisting, CEO Xu said CNOOC has been communicating with the US government to overcome misunderstandings "so to be removed from the sanction list as soon as possible".
CNOOC's Hong Kong-listed shared have recovered more than 20% over the last three weeks as European and Asian investors bargain-hunted its shares hit by the US investment ban.
With reporting by Reuters
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