China's offshore oil and gas specialist CNOOC Ltd said on Thursday it planned to ramp up spending by at least 40 percent in 2018, as well as raise production.
The company, the listed upstream arm of state-owned China National Offshore Oil Corp, has pegged this year's capital expenditures in a range of 70 billion to 80 billion yuan ($11.13 billion to $12.72 billion), according to a document on its website.
In 2017, CNOOC spent less than the capital expenditure forecast it gave. The company said it would spend between 60 billion to 70 billion yuan versus estimated actual expenditures of 50 billion yuan. The 2017 spending was up slightly from 49 billion yuan in 2016.
Like its global peers, CNOOC responded to the oil price collapse that started in the middle of 2014 with three years of belt-tightening, before raising capital expenditures last year.
Crude oil prices have gained 32.5 percent over the past six months to about $70 a barrel because of supply cuts by the Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC producers including Russia.
In 2018, CNOOC forecasts that net oil and gas output will rise to between 470 million to 480 million barrels of oil equivalent (boe) from an expected 469 million boe last year. China operations will account for around 64 percent of that output, CNOOC said.
The company beat its 2017 production target of 450 million to 460 million boe, and the new 2018 target is around 3 percent higher than the 2018 guidance provided one year ago.
Five new projects are set to come on stream this year, CNOOC said, including three in the western part of the South China Sea, one in Bohai Bay and the Stampede deepwater field in the U.S. Gulf of Mexico, in which CNOOC has a 25 percent interest.
The latest production forecast for 2019 is 485 million boe, also up from 12 months ago, and 500 million boe for 2020.
($1 = 6.2906 Chinese yuan renminbi)
