In-Briefs

China: ConocoPhillips and CNOOC Closer to Reopening China’s Largest Oil Field

January 14, 2013
| Energy
| Asia and the Pacific
In December, China’s National Development and Reform Commission approved the new development plan by China National Offshore Oil Corporation (NYSE: CEO) and ConocoPhillips (NYSE: COP) for the Penglai oil fields . . . the partners are attempting to gain permission to reopen Penglai 19-3, the largest offshore oilfield in China, and begin production at Penglai 25-6 . . . the government closed the 19-3 field in September 2011 after 3,200 barrels of oil spilled into North China’s Bohai Bay . . . ConocoPhillips's share of oil production from the field was 62,000 barrels a day before the spill . . . last year, ConocoPhillips and CNOOC agreed to pay $161 million in compensation for the spill . . . although Beijing requires the companies to meet additional regulatory requirements before re-opening the fields, it appears production will restart before the end of 2013 . . . the field should reach full operational capacity within six months after resuming production . . . China has a vested interest in allowing extraction to continue, as the country is straining to meet energy requirements, but it is proceeding delicately because of huge public and media criticism against ConocoPhillips after the spill.


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