CNOOC Limited CEO recently announced that the Liuhua 16-2 oilfield/ Liuhua 20-2 oilfield joint development project has started production in offshore China. The oilfields are located in the Eastern South China Sea.
It has plans to develop 26 wells at the site and bring those into production. The joint development project’s average water depth is 410 meters. Moreover, the development will include one 150,000 DWT floating production storage and offloading vessel. Also, three newly constructed underwater production systems will be used at the site. The China-based state-owned offshore oil and gas company expects the project to reach peak output capacity of 72,800 barrels of crude oil per day in 2022. The Liuhua 16-2 oilfield/ Liuhua 20-2 oilfield joint development project is fully owned by CNOOC.
The company was expected to start up eight offshore China projects this year, among which six were supposed to be located in the Bohai region and two in the Eastern South China Sea. It kicked off the Nanbao 35-2 oilfield S1 project in the second week of September, marking commencement of the fourth Bohai project. It has reportedly started production drilling in the Bozhong 19-6 gas discovery in Bohai bay. Onshore construction is being carried out in another project, Jinzhou 25-1 oil field 6/11 area, in the Bohai region. It is likely to witness peak production capacity of 16,500 barrels of oil equivalent per day (Boe/d).
The Liuhua 29-1 gas field development project in Eastern South China Sea is undergoing commissioning. Markedly, the company’s Buzzard oil field Phase II project located in the United Kingdom has been postponed to next year. It will likely have peak production capacity of 37,000 Boe/d. CNOOC has a 43.21% stake in the project.
For first-half 2020, the company’s production in China was recorded at 173.9 million Boe. During this period, its overseas production was 257.9 million Boe. Notably, the coronavirus pandemic had a significant impact on the company’s profits in first-half 2020. Net profit for the first six months of 2020 was recorded at RMB 10,383 million, down 65.7% from the comparable period in 2019. To navigate through the ongoing market uncertainty, it lowered its capital budget and production guidance for this year during April-end.
The stock has gained 20.1% in the past six months.
Zacks Rank and Other Stocks to Consider
Currently, the stock carries a Zacks Rank #2 (Buy). Other top-ranked players in the energy space include Equinor ASA EQNR, Pioneer Natural Resources Company PXD and Concho Resources Inc. CXO, each holding a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Equinor’s bottom line for 2021 is expected to skyrocket 125% year over year.
Pioneer Natural’s bottom line for 2021 is expected to surge 180.8% year over year.
Concho Resources’ bottom line for 2020 is expected to rise 34.4% year over year.
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