Energy Supply

Product Supply

To survive the extremely challenging external environment, the Company adhered to the business strategy of seeking progress while maintaining stability in 2021. We strived to increase reserves and production, steadily implemented major projects, firmly promoted technological innovation, actively expedited green and low-carbon development, and insisted on enhancing quality and efficiency to reduce costs, and achieved the best business performance in history.

We kept looking for mid-to-large sized oil and gas fields, and stepped up our exploration efforts. During the year, we made 22 new discoveries and successfully appraised 30 oil and gas bearing structures. In offshore China, 4 new mid-to-large sized oil and gas discoveries including Kenli 10-2 were made. Overseas, 6 new discoveries were made in Stabroek block in Guyana. The total recoverable resources in the block exceed 10 billion barrels of oil equivalent.

We remained committed to increasing oil and gas production, strived to enhance output and efficiency, and steadily advanced the construction of new projects. New projects including Caofeidian 6-4 oilfield, Kenli 6-1 oilfield, “Shenhai-1” gas field in offshore China, and Buzzard phase II in the U.K. North Sea have all been successfully commissioned. Over 20 projects were under construction in the year, which would strongly support our sustainable development.

Product Quality

CNOOC Limited upholds the principle of “people, safety, integrity, foundation, innovation, quality”. Following these principles, we carry out quality improvement actions, identify quality risks comprehensively, refine quality management systems, cultivate a culture of quality, and continuously improve the quality of products.

Strictly adhering to laws and regulations such as the Regulations of the People’s Republic of China for Product Quality Management , we have formulated the Policy for QHSE Management , the Measures for Quality Management and other internal management policies in accordance with domestic and international quality control standards and contractual quality requirements. We set up a full-time post of quality, safety and environmental protection as required. We invite third-party professionals to conduct independent sampling and undertake self-sampling and joint quality tests with customers to test the quality of our products and publish objective and truthful reports based on the results. In addition, we have strengthened supervision of customer transport of products to ensure that ships and vehicles for this purpose meet our standards, and ensure the safety and quality of the project of exporting products. In 2021, we conducted tests for crude oil, natural gas and byproducts throughout the Company. The quality of our products remains stable and meets the national standards, without a major quality disputes.

In 2021, we did not receive any client complaints regarding the quality of our crude oil, natural gas and by-products. Should any quality complaints arise, we will communicate with the clients in accordance with general international standards, and national standards for the quality of crude oil, natural gas and byproducts, to handle the complaints properly.

Cyber Security

CNOOC Limited continues to enhance the application of information systems in management, and takes the construction of “Digital CNOOC” and “Smart CNOOC” as the general idea to comprehensively improve the level of network security. We have structured a cybersecurity framework featured by “one centre, three lines of defence”, constructed a security operation centre at the headquarters, established a cybersecurity management structure, and defined cybersecurity goals and management principles, achieving full-scope, dynamic, real-time monitoring of our information assets. Besides, we continually enhance cybersecurity protection via special inspections and rectification and vulnerability tests to identify and rectify risks.

Technological Innovation

To achieve sci-tech self-reliance and self-strengthening at higher levels, we upheld the new development philosophy. In specific, we further promoted the innovation-driven strategy gave full play to our role as an innovation entity and accelerate our pace towards the deep sea. In addition, we continued to advance the reform of scientific and technological system.

In 2021, we, based on our strategic development goals, actively promoted the implementation of major science and technology projects and scientific research projects, and made major scientific achievements and technological breakthroughs in key fields such as exploration theory, efficient development, and production, operation and maintenance:

Major phased breakthroughs in key technology projects

• Independently developed and built the “Shenhai-1”, the world’s first 100,000-ton deepwater semi-submersible oil production and storage platform, creating 3 original technologies all over the world and adopting 13 original technologies in China.

• Development of localized equipment and sea trial verification of deep-water subsea oil and gas production system.

• The sea trial of China’s first underwater emergency blowout preventer led by the Company was successful.

Remarkable breakthroughs in national major science and technology projects

• 7 projects and 3 demonstration projects in National Science and Technology Major Projects led by the Company achieved good grades from 2015 to 2020.

• We developed 59 sets of products/equipment in partnership with more than 100 scientific research institutes, enterprises and public institutions.

• We received 11 national grade awards and developed 11 national standards.

• We proposed 15 key tasks for the development of upstream science and technology of offshore oil and gas in 2035.

Major science and technology projects for increasing reserves and production

Our “Seven-Year Action Plan” made phased breakthroughs in key technologies and their application in the deep-water/deep-zone

exploration and development, the effective development of heavy oil reservoirs, and the stable production of “high water-cut and recovery” oilfields through the “Seven-Year Action Plan”. Through these projects, we explored 270 million tons of additional proven reserves of crude oil and 95.2 billion cubic metres of natural gas throughout the year, and achieved a yield of 39.05 million tons of oil equivalent, facilitating the Company in achieving the overall goal of increasing reserves and production.

Steady progress in digital and intelligent transformation

• The “smart oilfield” system began to take shape. The Dongfang Smart Gas Field Clusters and the Qinhuangdao 32-6 Smart Oilfield Project (Phase I) have been put into use. The Enping Oilfield Cluster achieved unmanned production under the typhoon mode for the first time.

• We completed design and transformation of 9 unmanned platforms, and the unmanned rate of offshore in-production platforms reached 12.5%.

• We continued to promote the governance of exploration and development data, and the historical master data cleaning and inputting into the data lake has been basically completed.

In 2021, CNOOC Limited had 342 Pcs patent application and 419 Pcs authorized patents, implemented 159 technological innovation projects, and won one second prize of National Science and Technology Progress Award, three second prizes of National Technology Invention Award and eight technology awards at and above the provincial and ministerial level.

Supply Chain Management

CNOOC Limited has formulated and published the Implementing Rules for Internal Control Audit, which defines the details on reviewing the completeness and efficiency of the system in the qualification approval and evaluation of suppliers and the management of bid evaluation experts.

In 2021, in accordance with laws and regulations such as the Law of the People’s Republic of China on Tenders and Bids , on the basis of the Policy on Supply Chain Management , CNOOC Limited formulated the Supplier Management Implementation Rules , specifying standards and procedures for the classification, grading and handling of suppliers to avoid suppliers’ ESG risks. We attached great importance to the legitimate rights and interests of the parties involved in tendering and bidding. We issued the Management Rules for Handling Complaints in Tendering and Bidding Activities , standardising the procedures for handling supplier complaints in purchase, and specifying the strict confidentiality measures for complaints to safeguard the rights and interests of suppliers.

In 2021, we continued supplier registration and suppliers list management. Registered suppliers are entitled to participate in purchase of CNOOC Limited. Suppliers who sign the purchase contract and excellent suppliers developed by the Company can be listed in the Company’s supplier list. All of the subcompanies share the registered supplier resources and the whole-process management information on suppliers. As at the end of December 2021, we had approximately 3,300 suppliers, including more than 280 overseas suppliers.