CNOOC ups investment in Brazil

Stake in Buzios oilfield doubles to 10%, promising energy supply for China

CNOOC Petroleum Brasil has doubled its stake in the Buzios oilfield in Brazil to 10 percent from 5 percent, its parent China National Offshore Oil Corp announced on Thursday.

CNOOC paid $1.9 billion for the additional 5 percent stake as part of a production-sharing agreement with Petrobras, the Brazilian oil and gas giant that operates the field and holds an 85 percent stake in the venture. CNODC Brasil Petroleo e Gas holds the remaining 5 percent stake.

In 2019, CPBL signed an agreement with Petrobras for an initial 5 percent stake in the oilfield in Santos Basin, offshore southeast Brazil.

It is the world's largest deepwater pre-salt-producing oilfield with an average water depth of about 2,200 meters. It started operations in 2018.

The project is developed by the traditional deepwater pre-salt development mode called the FPSO+Subsea. Daily production has reached 600,000 barrels, said CNOOC.

Xia Qinglong, executive director of CNOOC, said acquiring additional interests in the Buzios oilfield further expands the company's presence in Brazil's deepwater pre-salt region, home to bountiful oil and gas resources.

"The transaction promotes the international development of the company and fortifies the resource base for the company's high-quality development," he said.

"The company will adhere to the concept of win-win cooperation and work closely with the host government and project partners to promote the sustainable development of Brazil's oil and gas industry, economy and society."

Li Ziyue, an analyst with BloombergNEF, said the oil and gas production of CNOOC is expected to rise more than 6 percent each year during the 2022-24 period and its continuous upstream investment and production commitment will also play a critical role in China's energy supply security.

CNOOC has been seeking to use its engineering prowess to become a major player in offshore wind power projects. It accounted for more than half of China's total oil and gas output growth in 2021, she said.

CNOOC currently owns five deepwater oil and gas block assets in Brazil. In 2013, CNOOC, Petrobras, Shell, TotalEnergies and China National Petroleum Corp formed a consortium to win the Libra block, entering the Brazilian subsalt ultra-deepwater oil and gas field for the first time.