China: CNOOC Posts 1H Results

CNOOC Limitedannounced its interim results ended June 30, 2012.

For the first half of the year, the Company’s average realized oil price reached US$116.91 per barrel, representing an increase of 8.1% year-over-year (YoY), and the average realized natural gas price reached US$5.90 per thousand cubic feet, representing an increase of 20.0% YoY.

During the period, the Company’s net oil and gas production reached 160.9 million BOE, a decrease of 4.6% YoY primarily caused by the shutdown of production of the Penglai 19-3 oilfield, the scheduled maintenance, and the disposal of the ONWJ block in Indonesia. By bringing the scheduled new projects on stream, ensuring the good performance of the facilities and equipments, and optimizing the technologies used for production enhancement, we are confident to accomplish our annual production target of 330-340 million BOE set by early this year.

Benefited from the rising average realized oil and gas prices, the oil and gas sales of the Company reached RMB95.66 billion and the net profit amounted to RMB31.87 billion, maintaining its strong profitability in the industry. Attributed to the rising industry costs and structural change of the Company’s asset portfolio, our all-in cost for the first half of the year was US$34.60 per barrel, representing an increase of 13.1% compared to that of year 2011.

The Company has achieved encouraging results in the exploration sector. In addition to 10 successful discoveries and 18 appraisal wells made in the first half, the Company also made significant progress in various fronts. A series of successful appraisal wells proved Penglai 9-1 would become the biggest oil and gas structure discovered in Bohai area in recent years. The successful appraisal of Qinhuangdao 29-2 East structure expanded the original Qinhuangdao 29-2 structure as well as its reserve scale. In this period, the company has also made mid-to-large sized discoveries including Kenli 2-1, Luda 21-2 and Luda 6-2. In addition, natural gas discovery was made in the Liuhua 29-2 structure in deepwater of South China Sea, demonstrating a great exploration potential for the area.

In the meantime, The Company achieved new breakthrough in its overseas development. In February, the acquisition of one-third interest in each of Exploration areas of 1, 2 and 3A in Uganda was completed. In July, we signed an agreement for the acquisition of Nexen Inc. in Canada. This transaction will make the Company a truly global exploration and production company with a balanced resources portfolio and important presences in the world’s major oil and gas production areas.

Mr. Wang Yilin, Chairman of the Company commented, “In view of rapid developments in the different areas of the Company’s business and faced by uncertainties of the external environment, we will pay increasing attention to build our own capabilities. We shall enhance our core management, strengthen our development foundation, and continuously raise the Company’s core competitiveness and capability of sustainable development. We will strive to build up a strong foundation for the Company’s “A new leap forward” blueprint and to continue to create value and returns for our shareholders.”

Mr. Li Fanrong, CEO of the Company commented, “During the first half of the year, downward pressure for the world’s economic growth was mounting as Europe’s debt crisis continued to deepen and international oil prices decreased significantly from a high level. In view of the critical external environment, we will continue to ensure good performance in the different areas of business of the Company, strengthening our foundation and striving forward for future development.”

In consideration of the capital requirements of the Nexen transaction and to maintain financial flexibility and support the Company’s long-term growth, the Board of Directors has decided to pay an interim dividend of HK$0.15 (tax inclusive) per share for 2012.

[mappress]
LNG World News Staff, August 21, 2012