Shell signs new upstream deal with CNOOC
Jan 08, 2013
Beijing, 1 August 2013: Shell announces today that it has signed an offshore oil and gas Production Sharing Contract (PSC) with CNOOC for block 35/10 in the Yinggehai Basin west of the Hainan Island, China.
Block 35/10 covers a total area of 3,427 square kilometers with water depth of 80-110 meters.
This is the third offshore oil and gas PSC Shell and CNOOC have signed in the Yinggehai Basin following the signing of PSCs 62/02 and 62/17 in July 2012. Shell will hold a 100% working interest during the exploration phase. In any eventual development phase, Shell will hold 49% interest and CNOOC 51%.
Shell, as operator, will apply advanced seismic acquisition and processing technologies to conduct 3D seismic data surveys in the block. During the exploration phase, Shell will carry all the exploration costs and apply advanced technologies in the exploration operations.
Huibert Vigeveno, Executive Chairman of Shell Companies in China, said: “We are delighted to increase our position in the Yinggehai Basin and continue to expand our cooperation with CNOOC. We look forward to successful exploration outcomes in the coming years.”
The two parties have also signed a Memorandum of Understanding (MOU) to jointly explore potential cooperation opportunities in the strategic areas of mutual interest and benefit in China and internationally.
Note for editors
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In China, Shell signed PSCs with CNOOC for the 62/02 and 62/17 Yinggehai blocks in July 2012 and received government approval in November 2012. This signing marked Shell’s return to offshore exploration in China and an opportunity to work with CNOOC again on a major project after the successful Nanhai petrochemicals joint venture in Guangdong province.
With PetroChina, Shell operates the onshore Changbei tight-gas field under a PSC. The two parties have also agreed to appraise, develop and produce tight gas in the Jinqiu block in central Sichuan province under a 30-year PSC (Shell interest 49%), which expires in 2040. Also in Sichuan, Shell and PetroChina are assessing shale gas opportunities in the Fushun-Yongchuan block. The two parties are also evaluating coalbed methane acreage in the Ordos Basin and are currently drilling wells and acquiring seismic data.
Shell is a partner in the Hangzhou city ring joint venture that constructs, operates and manages a high-pressure natural gas pipeline system.
Our Downstream business in China has 15 joint ventures and 8 wholly-owned companies. The various Shell ventures cover about 1,000 Retail fuel stations, 7 Lubricant blending plants, 5 Bitumen plants, and the Nanhai Petrochemicals complex.
Spokesperson, Shell Companies in China
Tel: (86-10) 6529 5613
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