China National Offshore Oil Corp. said Monday that it's making nine
offshore blocks in the South China Sea available for joint operation
with foreign companies.
The blocks, in water 300-4,000 meters deep, cover an area of
160,124.38 square kilometers, the company said in a statement on its
website.
Seven blocks are located in the Zhongjianan Basin and two in
areas covering parts of the Wan'an and Nanweixi basins, the company
said.
The move comes as Cnooc has been striving to reduce its
reliance on foreign expertise by recently developing its own deepwater
capabilities as part of efforts to locate more domestic oil and gas
reserves in more challenging offshore locations. With the official
launch of its first ultra-deepwater drilling platform May 9, Cnooc for
the first time independently drilled deepwater wells without the help of
a foreign partner or equipment.
The company offered 19 offshore blocks for joint operation
with foreign companies in 2011 and 13 offshore blocks in 2010.
Cnooc, China's largest offshore oil and gas producer by
capacity, has been collaborating with international companies to develop
its offshore oil fields since the 1980s due to technical difficulties
and economic risks involved in offshore oil development, according to
China Daily. Cnooc owns 51% of the oil and gas output from the fields,
while the foreign companies own the remainder as a result of providing
capital and technology during the exploration stage.
Cnooc has traditionally relied on foreign partners such as
Canada's Husky Energy Inc., U.S.-based Chevron Corp. and
U.K.-based BG Group to explore and operate deepwater blocks off
China.
Although Husky achieved considerable success finding deepwater
gas in the Liwan 3-1 field in 2006, the lack of seismic data, high cost
of drilling exploratory wells and less-than-lucrative contract terms
have discouraged foreign companies from partnering to develop China's
deepwater blocks.
Last year, Cnooc publicly offered its first deepwater oil
blocks to foreign companies for joint operation, but only Italian oil
major Eni
SpA made a successful bid, announcing in April that year that it
had signed a production-sharing contract with Cnooc for a block located
400 kilometers off Hong Kong.
A third of China's oil and gas reserves are located in the
South China Sea, and 70% of those are located in a
1.537-million-square-kilometer deepwater area, according to company
Chairman Wang Yilin.