CNOOC confirms deepwater gas discovery in Qiongdongnan Basin in the South China Sea

Source: CNOOC, BG Group

CNOOC Limited (NYSE:CEO) announced a deepwater gas discovery on Block 64/11 offshore China after the Lingshui 22-1-1 exploration well drilled by its partner, BG Group, encountered gas-bearing sands. 

The exploration well is located in Qiongdongnan Basin in the South China Sea, approximately 130 kilometers offshore and in a water depth of 1,338 meters. BG will conduct further analysis of the well results to evaluate the hydrocarbon potential in the Block. 

“This is the first deepwater well in Qiongdongnan Basin,” said Zhu Weilin, Executive Vice President of CNOOC. “We are excited about the well results. It has further strengthened our confidence in deepwater exploration in this area.”

The Company signed the production sharing contract (PSC) with BG for deepwater block 64/11 on June 7, 2006.

BG Group is the operator of deepwater PSC blocks 64/11 and 53/16 in the Qiongdongnan basin and has a 100% interest during the exploration phase. In the event of a commercial discovery, China National Offshore Oil Corporation has the right to take an interest of up to 51% in any field developments.

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