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Shares fall as oil production suspended
By Richard Fu |
September 6, 2011, Tuesday
|
Print Edition
Print Edition
CNOOC shares fell as much as 10 percent after China's maritime regulator ordered suspension of production at the nation's largest offshore oilfield, in which the company holds a majority stake.
The State Oceanic Ad-ministration last Friday asked US oil major Conoco-Phillips, CNOOC's partner in the Penglai 19-3 project in Bohai Bay, to halt operations at all the field's platforms after finding it failed to stop the oil leaks that began in June -before the August 31 deadline.
ConocoPhillips, operator and a 49 percent owner of the field, has been held accountable for the leaks. CNOOC, China's top offshore oil producer, holds 51 percent of Penglai 19-3.
CNOOC said on Sunday the suspension of the field will reduce its output by a further 40,000 barrels a day - beyond the earlier loss of 22,000 barrels a day since the suspension of operations at two platforms on July 13.
JPMorgan estimates a 4 percent to 5 percent impact on CNOOC's full-year earnings but said it is unclear how costs and penalties will affect the companies.
CNOOC shares tumbled 8.76 percent to HK$13.86 (US$1.80) yesterday.
CNOOC last month cut its full-year production target to 331 milllion to 341 million barrels of oil equivalent from 355 million to 365 million, citing the delayed closure of an acquisition in Argentina and the loss from the two platforms shut in July.
The oceanic authority said production at Penglai 19-3 can resume only after operator ConocoPhillips has sealed all leaks and finished a complete clean-up.
The State Oceanic Ad-ministration last Friday asked US oil major Conoco-Phillips, CNOOC's partner in the Penglai 19-3 project in Bohai Bay, to halt operations at all the field's platforms after finding it failed to stop the oil leaks that began in June -before the August 31 deadline.
ConocoPhillips, operator and a 49 percent owner of the field, has been held accountable for the leaks. CNOOC, China's top offshore oil producer, holds 51 percent of Penglai 19-3.
CNOOC said on Sunday the suspension of the field will reduce its output by a further 40,000 barrels a day - beyond the earlier loss of 22,000 barrels a day since the suspension of operations at two platforms on July 13.
JPMorgan estimates a 4 percent to 5 percent impact on CNOOC's full-year earnings but said it is unclear how costs and penalties will affect the companies.
CNOOC shares tumbled 8.76 percent to HK$13.86 (US$1.80) yesterday.
CNOOC last month cut its full-year production target to 331 milllion to 341 million barrels of oil equivalent from 355 million to 365 million, citing the delayed closure of an acquisition in Argentina and the loss from the two platforms shut in July.
The oceanic authority said production at Penglai 19-3 can resume only after operator ConocoPhillips has sealed all leaks and finished a complete clean-up.
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