China National Offshore Oil Corporation (CNOOC) has signed strategic cooperation agreements for oil and gas exploration in offshore China with nine international companies.
CNOOC and the nine companies – Chevron, ConocoPhillips, Equinor, Husky, KUFPEC, Roc Oil, Shell, SK Innovation, and Total – will share development opportunities in strategic cooperation areas located in the Pearl River Mouth Basin offshore China, CNOOC’s exploration and production company CNOOC Limited said in a statement.
“The agreements will facilitate the establishment of a long term and stable cooperation and share the development opportunities to a certain extent in the Strategic Cooperation Areas, creating conditions for the final signing of contracts,” CNOOC said.
Chinese companies are trying to tap more resources at home to replace dwindling production at mature oil and gas fields while China’s oil and gas demand continues to grow.
Earlier this year, China National Petroleum Corporation (CNPC) advanced a strategic partnership with Brazil’s Petrobras and agreed to cooperate with Norway’s Equinor in oil and gas projects, in an effort to expand Chinese gas production.
As part of a governmental push to boost domestic energy supply, CNPC and Sinopec are raising investments to increase local oil and gas production and are accelerating drilling at tight oil and gas formations in western China. Domestic natural gas production has been rising in recent months, but the growth rate has yet to meet the booming demand due to the cleaner-fuel/cleaner-air government policies.
Domestic oil production, on the other hand, has been falling due to the depletion of mature conventional oil fields. In a bid to meet this need, Chinese President Xi Jinping has ordered the state-held companies to boost domestic production of oil and gas, and firms are starting to follow the policy.