China CNOOC Q3 Profit Climbs 89% to $5.1B as Energy Prices Surge

October 27, 2022

CNOOC Ltd's third-quarter net profit soared by 89% from a year earlier to 36.9 billion yuan ($5.11 billion), driven by stronger oil and gas prices, the Chinese offshore oil and gas major said on Thursday. 

Third-quarter revenue rose 54% on the year to 89.2 billion yuan. Total net production rose 8.8% to 156.8 million barrels of oil equivalent (boe), with domestic fields making up 68% and overseas operations 32%. 

Third-quarter capital spending rose by nearly 30% to 27.1 billion yuan, taking the total for the first nine months to 68.7 billion yuan, versus an annual budget of 90-100 billion. 

CNOOC said its realized oil prices increased 36% from a year earlier to $95.8 per barrel, while gas prices gained 15% to $8.15 per thousand cubic feet.

In a sign of accelerating domestic exploration, CNOOC announced last week a new deep-water, deep-stratum discovery, Baodao 21-1-1, in the South China Sea, that holds a government-certified proven reserve of 50 billion cubic meters of natural gas. 



Speaking to reporters, Chief Financial Officer Xie Weizhi said Baodao is still in the development planning stage, and the company has yet to make a final investment decision. 

Concerning CNOOC's North Sea investments, Xie did not directly comment on the sale of any oil assets, but said the company would not rule out a sale if offers came in better than the assets' profitability under the company's own operation. 

"The company has consistently been optimizing global assets to better fit its technological edge as well as management style," said Xie. 

Sources told Reuters earlier this month that Norway's Equinor is considering buying oilfields in the British North Sea from CNOOC, including a big stake in the huge Buzzard field. 

CNOOC's Hong Kong-listed shares have gained 35% year-to-date, sharply outperforming the benchmark Hang Seng Index which fell 34%. Its Shanghai-listed shares have risen 11.5% since their debut in late April.

 ($1 = 7.2275 Chinese yuan renminbi) 

(Reuters - Reporting by Chen Aizhu; editing by Barbara Lewis and Kim Coghill)



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