China's CNOOC finds 100 million tonne oil reserves in South China Sea oilfield

China National Offshore Oil Company (CNOOC), the state-owned Chinese oil giant, on Friday reported a major oil field discovery in Kaiping South in the deep-water of the South China Sea. The oil field has an in-place proven oil equivalent reserves of over a 100 million tonnes.

CNOOC struck oil in the KP18-1-1d well after drilling to a depth of 3.462 metres. Oil and gas bearing zones were also found at water depths of up to 100.6 metres. 

The well was seen yielding an average 7,680 barrels of crude and 0.52 million cubic feet of natural gas a day. 

CNOOC said the proven in-place volume of Kaiping South oilfield could reach 102 million tonnes of oil equivalent.

Located at the Pearl River Delta near Guangdong province in the eastern South China Sea, the Kaiping South oilfield has an average water depth of 500 meters. 

The oilfield contains light crude and the main oil-bearing areas include the Zhuhai Formation, Enping Formation and Wenchang Formation of Paleogene. 

Faced with depleting assets, CNOOC has been investing heavily in offshore oil and gas exploration. It has also invested heavily in developing Russia’s Siberian oil and gas fields.

NOOC has set a net production target of 700–720 million barrels of oil equivalent (mboe) in 2024) with China accounting for 69 per cent and the rest from outside the country’s economic zone. 

CNOOC is expected to have produced around 675mboe in 2023.

With planned capital expenditure of over 128 billion yuan ($17.8 billion) in 2024, CNOOC has set production targets of 780–800mboe and 810–830mboe, respectively, for 2025 and 2026.