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CNOOC may face US sanctions

POLICY THE US government is reportedly preparing to Bernstein Research applied a 30% discount
added China’s state-owned China National Off- to CNOOC Ltd’s share price targets, citing such
shore Oil Corp. (CNOOC) to a growing black- risks as a ban on US investment in the company
list of companies believed to be connected to the or US companies being prevented from doing
Chinese military. business with it.
Washington is set to add CNOOC – along Bloomberg Intelligence analyst Henik Fung
with state-run Semiconductor warned that US investors held
Manufacturing International 16.5% of CNOOC Ltd’s shares as of
Corp. (SMIC), China Construc- November 27 and that if sanctions
tion Technology and China Inter- Bernstein went ahead then it would create
national Engineering Consulting potential for “major outflows”.
– to a list of companies deemed as Research applied Washington published an
either being owned or controlled a 30% discount executive order in November
by the Chinese military, Reuters that seeks to prohibit US inves-
reported on November 30. The to CNOOC Ltd’s tors from buying securities of
newswire cited both an unspeci- blacklisted companies from
fied document it had seen as well share price November 2021.
as anonymous sources. “My guess is, it’s CNOOC
CNOOC’s listed arm, CNOOC targets that got targeted, and not CNPC
Ltd, said in a filing to the Hong or Sinopec, because of its drill-
Kong Stock Exchange (HKSE) that day that ing in the South China Sea area, which is
its parent had not received formal notice from deemed as so-called military actions by
relevant US authorities. It added: “The com- the US,” the dean of Xiamen University’s
pany is closely monitoring the development of China Energy Policy Research Institute, Lin
the situation.” Boqiang, told Bloomberg.™

Sinopec sets shale gas

production record at Fuling

PROJECTS & CHINA’S state-run Sinopec has set a new shale
COMPANIES gas production record at its Fuling project in
Chongqing municipality, state-run China Daily
said on December 2.
The company set a new daily production
record of 20.62mn cubic metres at the field
on October 31, with production for the whole
expected to reach 6.7bn cubic metres.
Sinopec said 192 bcm of certified new reserves rose by 513.1% on the year to 764.4 bcm
reserves had been added to the field, while in 2019, while newly-added technical reserves
proven geological reserves now amounted to exceeded 183.8 bcm.
940.8 bcm. Sinopec said on November 12 that it had
“The increased output is driven by continu- expanded its proven natural gas reserves at the
ous investment of China’s national oil companies Chuanxi field by 83 bcm, raising the field’s total
to increase energy security. With newly-discov- proven reserve to 114 bcm. The company added
ered shale gas resources jumping six-fold to that key reservoirs, spread over 138 square km,
about 764 bcm, shale gas is expected to be the were buried 6,000 metres below the surface and
next growth engine to boost domestic gas output contained a high acidic content.
in China,” BloombergNEF analyst Li Ziyue told The company had begun shifting its focus
the paper. from oil production to the cleaner burning fuel,
China’s shale gas production climbed 41.4% given the central government’s ongoing coal-to-
year on year in 2019 to 15.4 bcm, with the gas conversion campaign.
majority of that coming from plays located in Sinopec said in mid-November that it wanted
the Sichuan Basin, according to the Ministry of to increase gas’ share in its production portfolio
Natural Resources. National proven shale gas to more than 50% in 2023, from 41% in 2019.™

Week 48 03•December•2020 www. NEWSBASE .com P7