CNOOC Three Quarter Oil And Gas Sales Revenue 48 Billion 300 Million Capital Expenditure Increased By Nearly 30%

On the afternoon of October 24th, Cnooc Limited (00883.HK) (hereinafter referred to as CNOOC) released its third quarter financial report. In terms of output, the company achieved a total output of 124 million 800 thousand barrels of oil equivalent in the third quarter, an increase of 9.7% over the previous year, and 367 million 800 thousand barrels of oil equivalent in the first three quarters, up 4.5% over the same period last year.

In terms of performance, CNOOC's oil and gas sales revenue in the third quarter was 48 billion 340 million yuan, up 0.8% from the same period last year. The total sales volume of oil and gas sales reached 142 billion 619 million yuan in the first three quarters, up 7.2% over the same period last year. It is worth mentioning that the price of oil in the first three quarters of this year is lower than that of the same period last year. The increase in CNOOC's sales revenue is mainly due to the increase of output and the control of cost.

On the afternoon of 24, CNOOC also announced that Wang Dongjin took over as chairman of the group company and Secretary of the Party group, and at the same time removed the position of general manager of the group company. In terms of listed companies, Wang Dong Jin is currently the chairman of CNOOC. After the performance was released, CNOOC management held a press conference to answer our reporter's questions on the changes in the management of listed companies.

"Because we are a listed company, all the senior executives' appointments and dismissals need to go through the process of the board of directors." Xie Yuzhi, chief financial officer of CNOOC, told the twenty-first Century economic news reporter that "the process has not yet started and will be released to the market after the board has made the final decision."

In terms of output growth, CNOOC has shown many foreign flowers and oil and gas simultaneously. -IC photo-

Strong performance growth

In terms of output growth, CNOOC presented the situation of multiple flowering and oil and gas development both inside and outside the country.

In the third quarter, the net output of China's offshore area reached 80 million 200 thousand barrels of oil equivalent, up 8.9% from the same period last year, mainly due to the increase in output of new projects, and the net output of overseas reached 44 million 600 thousand barrels of oil equivalent, an increase of 11.2% over the same period, mainly due to the increase in output of Egina and Appomattox projects.

During the period, 3 new discoveries were obtained and 19 evaluation wells were successful. Among them, the success of China's sea area evaluation of Kenli, Bohai, 6-1, is expected to become a medium-sized oil and gas structure; overseas, Guyana Stabroek block was re discovered Tripletail, which is fourteenth new discoveries in the block, and will provide support for the development of Turbot area in the future.

According to the performance guidelines issued by the company in early 2019, the company's goal this year is to achieve the production target of 480-490 million barrels of oil equivalent. According to the rule of production in the fourth quarter of this year, the difficulty of achieving the goal is not great.

"The situation in the first three quarters is very good. We are confident that we can complete the whole year's oil and gas production according to the upper limit of target output or even beyond the ceiling." Xie Yuzhi said, "as far as we can achieve the output of 500 million barrels of oil equivalent, we will work hard in this direction."

In terms of sales revenue, due to the great influence of oil prices, although there are obvious results in oil and gas production and cost control, the increase in income is not large. "For the trend of oil prices, we hope that oil prices will stabilize or even recover in the fourth quarter." He said, "but ultimately, the key to this problem should be in Saudi Arabia."

It is worth mentioning that the company realized capital expenditure of 19 billion 530 million yuan in the third quarter, a sharp increase of 27.9% compared to the same period last year, and realized a total capital expenditure of 53 billion 230 million yuan in the first three quarters, significantly higher than the same period in previous years.

"From the third quarter's performance, our capital expenditure has been ideal in recent years." Xie Yuzhi, chief financial officer of CNOOC, told reporters that "we are confident that the target of 700-800 billion capital expenditure will be completed according to the guidelines issued at the beginning of the year."

Bozhong 19-6 has limited progress.

In February 25th of this year, CNOOC announced that its Bohai oilfield condensate gas field Bozhong 19-6 was formally approved by the Ministry of natural resources. It proved that the geological reserves of natural gas exceeded one hundred billion cubic meters, and the condensate oil reserves exceeded 100 million yuan.

This is the largest natural gas discovery in the mining history of more than fifty years in the Bohai Bay basin. At the same time, it is located in the hinterland of Beijing, Tianjin and Hebei, and is of great significance to the supply of natural gas in related areas, especially in the winter peak period.

Subsequently, the project was included in the NDRC's natural gas protection project. At the mid-term conference this year, CNOOC said that in the first half of 2019, 4 evaluation wells have been completed, and more than 100 meters of gas have been obtained. The newly proved reserves exceed 100 million tons of oil equivalent.

However, when our reporter asked the management about the progress of this block at the press conference, Xie Yuzhi said frankly, "it is not smooth." "Our plan is to carry out pilot production in pilot area in Bozhong 19-6 block this year, because it is a condensate gas field. We hope to find out the law of Qianshan oil and gas reservoir in this way." He said.

Xie Yuzhi further indicated that even if the production was put into operation this year, there would be no large-scale production. Its production was only for data for further development. However, the current progress is not ideal. "Because Bohai is a very busy sea area, many units such as transportation, fishing and so on are making use of this area." Xie Yuzhi said, "we need to do a lot of coordination work, so there will be some delay in the progress."

In August 1st of this year, CNOOC announced that its wholly owned Affiliated Companies, CNOOC China, acquired 100% stake in Zhonglian company held by CNPC for 5 billion 335 million yuan. The acquisition was completed in October 11th and has been reflected in CNOOC's third quarter performance report.

The report shows that Zhonglian has built two production bases on the Qinshui Basin and the eastern margin of the Ordos Basin, and will contribute to the company's natural gas production. "The reserves of Zhonglian company are still very impressive. After the acquisition, we plan to substantially increase investment in exploration and development and rapidly increase production." Xie Yuzhi said, "by improving production, we can improve its efficiency."

In addition, at the beginning of this year's performance press conference, CNOOC announced its entry into offshore wind power industry as a direction for the company to explore new energy sources. Xie Yuzhi told our reporter that the above projects had been successfully built in Jiangsu and that the grid connected power generation is expected to be achieved next year.