China's CNOOC targets 5% increase in 2024 oil and gas output

China's offshore giant CNOOC aims to raise its oil and gas output to 1.95 million b/d of oil equivalent in 2024, about 5.2% higher from its estimated output of 1.85 million boe/d last year, the state-owned company said late-Jan. 25.

CFO Wang Xin said at the Jan. 25 strategy briefing that the production target for this year was 700 million-720 million boe (1.92 million-1.97 million boe/d), while the estimated output in 2023 is expected to reach 675 million boe, exceeding the initial target of 650 million - 660 million boe.

CNOOC will release its 2023 business results in late-March this year.

The output growth will stem from 13 new projects due to come on stream in 2024. Of these, 11 domestic projects were led by the Suizhong 36-1/Luda 5-2 Oilfield Secondary Adjustment and Development Project and Bozhong 19-2 Oilfield Development Project, with the two overseas ones led by the Mero 3 Project in Brazil -- which will contribute 188,200 boe/d at peak to CNOOC's oil and gas production, Wang said.

Meanwhile, CEO Zhou Xinhuai revealed that the production in the Stabroek block offshore Guyana, is not in the disputed area and has been stable. The Guyana project has been one of CNOOC's most important overseas projects which contributed to the production growth.

Oil production to remain stable

CNOOC expects production to continue growing over the next two years, with plans to reach 2.25 million boe/d in 2026.

But the proportion it has targeted for domestic oil and gas production for 2025 and 2026, will gradually fall to around 67% and 66%, respectively, against its global output, from a target of 69% in 2024.

"CNOOC will continue to maintain the stable growth in oil production till 2025 .....but after that the main growth will come from gas," Zhou said.

Wang added that the oil production after 2025 would depend on the market demand at that time and was subject to changes.

CNOOC's Energy Economics Institute, or CEEI, forecasts China's offshore oil production to peak at 70 million-80 million mt (1.41 million-1.61 million b/d) by around 2045 before slowly declining, while the share of offshore production is projected to rise to more than 40% in 2060 from less than 25% in 2020.

But the company expects the natural gas production to account for about 30% of the total production in 2025, Zhou added.

China's offshore oil blocks have been the main contributor of its crude oil production growth.

Tianjin city and Guangdong province, where CNOOC's offshore blocks Bohai and South China Sea are located, led the year-on-year production increment with 39,000 b/d and 23,000 b/d in 2023, respectively, NBS data showed. The country's crude oil production gained 84,000 b/d, or 2%, on the year to 4.2 million b/d in 2023.

Capex increases

CNOOC is also looking to spend between Yuan 125 billion and Yuan 135 billion ($17.6-19 billion), up 1.56% from an estimated capital expenditure of Yuan 128 billion in 2023. Of this, nearly 63% will go into development in 2024, up from a portion of 60% in 2023.

CNOOC will continue to advance projects to cut greenhouse gas emissions from oil and gas production activity in the year, and around 5%-10% of its annual budget will be spent on its new energy and low carbon emission business.

Among others, the company plans to set up an offshore CCUS demonstration center in northern China, which relies on Bozhong 19-6 gas field. Meanwhile, green electricity consumption is expected to exceed 700 million KWH in 2024.

CNOOC's 2024 Operation Targets

Source: CNOOC