China's CNOOC has announced a sizeable discovery offshore that could contain as much as 100 million tons of oil equivalent.
The discovery was made in the South China Sea, in an already producing area of the Pearl River Delta, the company said, as quoted by Reuters. The resources in it are light crude.
CNOOC, whose net oil and gas production hit an all-time high of 675 million barrels of oil equivalent in 2023, now aims at an output of between 700 million and 720 million barrels of oil equivalent this year as it significantly raised its production targets in the 2024 business strategy and development plan.
The new discovery will help the company achieve its targets as new output from such discoveries offset declining production from older fields onshore. A significant portion of CNOOC's investments recently have been focused on this offsetting through the development of new fields.
"The majority of China's oil fields are in a mature phase, facing natural production declines, (while) the scarcity of substantial new discoveries poses a challenge to sustaining long-term production growth at current rates," Rystad Energy analyst Lin Chen said last December in comments on the outlook for Chinese oil production.
CNOOC has been at the forefront of the reserve replacement rush after domestic oil output fell by 12% between 2015 and 2018. It appears things have been going well, with production forecast for solid growth in the coming years. The company's net production target for 2025 was set at 780 million to 800 million boe, and output in 2026 is planned to further rise to between 810 million to 830 million boe.
The company expects major new projects in China and the Mero3 project in Brazil to "strongly support production growth" this year.
CNOOC will also look to boost natural gas exploration activity in the South China Sea, the Bohai Sea, and onshore China.
By Irina Slav for Oilprice.com
Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry. More