CNOOC sets 2020 capex at $13.7 billion in push to boost production

China’s CNOOC Limited has said that its capital expenditure for 2020 is budgeted at up to $13.7 billion as the company pursues an increase in its oil and gas reserves and production with 227 exploration planned to be drilled during the year.

CNOOC said on Monday in its business strategy and development plan for the year 2020 that the company’s net production for 2019 was expected to be approximately 503 million barrels of oil equivalent (BOE).

The company’s targeted net production for 2020 is 520 million to 530 million BOE, of which, production from China and overseas accounts for approximately 64% and 36%, respectively.

The company’s net production for 2021 and 2022 are estimated to be around 555 million BOE and 590 million BOE, respectively.

The company’s total capital expenditure for 2020 is budgeted at RMB 85 billion ($12.3B) to RMB 95 billion ($13.7B). The capital expenditures for exploration, development, production and others will account for approximately 20%, 58%, 20% and 2% of the total capital expenditure, respectively.

In 2020, the company plans to drill 227 exploration wells and collect approximately 27 thousand square kilometers 3D seismic data.

Ten new project to come on stream in 2020

In 2020, ten new projects are expected to come on stream, namely Penglai 19-3 oil field block 4 adjustment/Penglai19-9 oil field phase II, Qinhuangdao 33-1 South oil field phase I, Bozhong 19-6 gas field pilot area development project, Luda 16-3/21-2 joint development project, Nanbao 35-2 oil filed S1 area, Jinzhou 25-1 oil field 6/11 area, Liuhua 29-1 gas field development project and Liuhua 16-2 oil field/20-2 oil field joint development project in offshore China, Liza oil field phase 1 in Guyana and Buzzard oil field phase II in the UK.

Among which, Liza oil field phase 1 in Guyana has already come on stream ahead of schedule.

Xu Keqiang, CEO and the President of the company, said, “In 2020, the company will steadily increase its oil and gas reserves and production, pursue profitable reserves and production, lay a solid foundation for high-quality development through technology innovations and management enhancement, and create excellent returns for our shareholders.”