The Penglai 19-3 offshore oilfield is operated by CNOOC, China's largest oil and gas producer, and ConocoPhillips (NYSE: COP), and is the largest offshore oilfield in the country. Two years ago it was producing 62,000 barrels of oil a day, and, according to Bloomberg, provided CNOOC with around 7 percent of its targeted daily oil and gas production.
In September 2011 drilling activity in the field caused more than 3,200 barrels of oil to spill into North China's Bohai Bay, and the whole field was ordered to be shutdown. CNOOC and ConocoPhillips then worked to clean the spill up, and paid around $160 million in compensation to local fisherman, whose lives had been severely affected by the spill.
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The Penglai field has moved one step closer to re-opening after China's economic planner, the National Development and Reform Commission, approved the new development plan in December.
A spokesman for CNOOC stated that they "still have to go through other regulatory approvals and meet requirements before the site can resume production."
Shi Yan, an analyst at UOB-Kay Hian Ltd, claimed that "production at its full capacity could be achieved within six months of the restart."
By. Charles Kennedy of Oilprice.com
Charles is a writer for Oilprice.com More