CNOOC approves transfer of South China Sea PSCs from Devon to Chevron and BP

CNOOC has announced the signing of amendment agreements to the Production Sharing Contracts (PSCs) with Chevron China, BP China and Devon Energy for deepwater blocks 42/05, 64/18 and 53/30 in South China Sea. Prior to the amendments, Chevron acquired a 59.18% interest in block 42/05 and a 100% interest in blocks 64/18 and 53/30 from Devon in the exploration phase; and BP acquired the remaining interest of Devon in block 42/05. In 2005 and 2006, CNOOC had signed PSCs with Devon for these three blocks. Block 42/05, located in Baiyun Sag of Pearl River Mouth Basin in the Eastern South China Sea, covers a total area of 6,939 sq km. Blocks 64/18 and 53/30 are located in Qiong Dong Nan Basin in the Western South China Sea with acreage of 7,712 and 6,313 sq km respectively. Water depth of the three blocks ranges from 300 to 2,000 m.
During the exploration period, Chevron will act as the operator in the three blocks. CNOOC Ltd. has the right to participate in up to a 51% interest in the event of any commercial discovery in the blocks. Zhu Weilin, CNOOC Executive Vice President and General Manager of the Exploration Department commented, “We welcome Chevron and BP to become our new partners in these blocks and look forward to the joint exploration of the great deepwater potential in the South China Sea.”