China National Offshore Oil Corporation (CNOOC) has announced its plans to speed up exploration and development of natural gas, including reserves in the South China Sea, and tap onshore unconventional fuel resources such as shale gas in a bid to reduce carbon emissions.
According to the firm, its net oil and gas production in 2020 increased by 5% to 528 million barrels of oil equivalent (boe). This year, it aims to increase its output to 545 to 555 million boe.
This year, it also intends to spend CNY90bn to CNY100bn ($13.93 to $15.48bn), its highest amount since 2014. It aims to focus on drilling in China as well as extract natural gas, which is comparatively less carbon-intensive than oil.
The company plans to make gas 30% of its portfolio by 2025 and 50% by 2035. To achieve this goal, CNOOC plans to accelerate large discoveries such as Lingshui 17-2 in the South China Sea and Bozhong 19-6 in the Bohai Bay, offshore China.
It will also develop unconventional gas resources, including tight gas and shale gas.
CNOOC CEO Xu Keqiang said: “Bohai Bay has huge natural gas potential and our exploration at the South China Sea is only at early stage.”
It plans to acquire gas assets in overseas markets.
The company expects the output from offshore projects to have a 68% share while its operations in the overseas markets are estimated to have a share of 32%, as against the 64% and 36% split recorded respectively in the last two years.
The firm stated that 19 projects will begin operations this year, and one prominent is its first completely owned deepwater gas field, Lingshui 17-2.
Last month, CNOOC began sailing Shenhai-1, an oil and gas production and storage platform, to Lingshui. First output from this field is expected late this year. It expects annual production to be more than three billion cubic metres.
It intends to allocate 3% to 5% of its total annual spending on offshore wind power. Last September, it launched its first wind power farm in east China and has planned renewable expansions in many coastal provinces.