The PSC signed by the two companies covers a block of 5130 km2 approximately 400km offshore Hong Kong and had first been offered to foreign companies in 2011. Eni will initially operate the deepwater Block 30/27 with a 100% stake. In the event of a discovery made in the area, however, CNOOC has the option to claim a stake of up to 51%.
Eni already operates another block in the South China Sea, Block 28/20 and has stakes in Block 16/08 and Block 16/19, which currently produce approximately 10 000 bpd. A statement released by Eni said that, “the attractive deep water of the South China Sea, has a high exploration potential.”
Eni is not alone amongst foreign companies operating in the South China Sea: Chevron and Husky Energy both conduct E&P activities in the region. Husky made a major discovery in 2006 of 4 – 6 trillion ft3 of natural gas; the company plans to begin deliveries to Southern China in 2013 or 2014 with daily rates expected to reach 500 million ft3 by 2015.
Edited from various sources by David Bizley
Read the article online at: https://www.oilfieldtechnology.com/exploration/11042012/cnooc_eni_sign_psc_for_south_china_sea/