(Asia-Pacific) - CNOOC Ltd.'s parent company, China National Offshore Oil Corp., has signed a production sharing contract with Devon Energy Corp. for deepwater block 42/05.
Block 42/05, located in Baiyun Sag of Pearl River Mouth basin in the Eastern South China Sea, covers a total area of 6,939 sq km with water depth ranging from 300 to 2,000 m. The company has acquired 2D seismic data in the block.
Under the terms of the contract, Devon is committed to conduct a 3D seismic survey and wildcat drilling during the exploration period. All expenditures incurred during exploration period will be borne by Devon.
CNOOC has the right to participate in up to a 51% interest in the event of any commercial discovery in the block.
CNOOC and Devon successfully developed Panyu 4-2/5-1 oil fields in block 15/34 and started commercial production in 2003.
Zhu Weilin, CNOOC's VP and general manager of the exploration department says, "'The signing of the contract is clearly evidence of Devon's confidence in the exploration potential and opportunities offshore China.
"We have established an outstanding work relationship with Devon. The cooperation has brought valuable return to both companies."
This contract is the fourth deepwater contract between CNOOC and its foreign partners.