Energy Supply

Product Supply

In 2023, CNOOC Limited solidly promoted high-quality development, actively advanced the three major initiatives of increasing reserves and production, technological innovation, and green development, and firmly implemented upgrading actions to enhance quality and efficiency. Both reserves and production have achieved historic highs, and profitability remained at a high level.

The Company adheres to value exploration and focuses on the discovery of large and medium-size oil and gas fields. We strengthened exploration efforts in key areas and achieved 9 new discoveries throughout the year. We also successfully evaluated 22 oil and gas bearing structures. In China, we successfully re-evaluate the Bozhong 26-6 field, which has an accumulated proven in-place volume of over 200 million cubic meters. In Kaiping South Oilfield, we obtained the new discovery Kaiping 18-1 and successfully evaluated Kaiping 11-4, with accumulated proven in-place volume exceeding 100 million tons, making it be the first deep-water and deep-play 100-million-ton oilfield. The Qinhuangdao 27-3 discovery revealed petroleum in-place volume exceeding 100 million tons, marking a significant breakthrough in shallow-water oilfields discoveries in the Bohai Sea. Additionally, the Company discovered China's first deep-play coalbed gas field with reserves of 100 billion cubic meters. In overseas regions, the Lancetfish discovery in the Stabroek block in Guyana was an ultra-deep-water and deep-play 100-million-ton level find. The total recoverable resource of the block reached approximately 11 billion barrels of oil equivalent. By the end of 2023, the Company's reserve replacement ratio reached 180%, maintaining a high level. With net production reaching record highs year after year, the reserve life has remained stable at over 10 years for seven consecutive years, laying a solid foundation for the sustainable development in the future.

The Company set its sights on the annual production target and continued to strengthen production and operation management, steadfastly accelerating the pace of production increase, and Product Supply efficiently organizing capacity construction. By promoting the fine development on the potential of old oilfields and ensuring the stable and increased production in the operating oil and gas fields, the natural decline rate of offshore oilfields reached best levels in the history. The capacity construction was further accelerated, over 40 construction projects were in progress this year; the construction of key projects proceeded smoothly, with new projects successfully put into operation, providing strong support for future sustainable development. In 2023, the net oil and gas production reached 678 million barrels of oil equivalent, an increase of 8.7% year-on-year, achieving rapid growth for multiple consecutive years. Thanks to scientific production and operation management, the Company continued to consolidate its cost competitive advantage.

Product Quality

CNOOC Limited upholds the principle of "people, safety, integrity, foundation, innovation, quality first". Following this principle, 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 our products.

We comply with the Product Quality Law of the People's Republic of China and have developed relevant polices including the Measures for Quality Management. By strictly following the domestic and overseas quality management standards and the quality standards as stipulated in the contracts, we ensure that the crude oil, natural gas and their by-products as well as liquefied petroleum gas sold all meet relevant requirements of the national standards.

We invite third-party professional institutions to conduct independent sampling and undertake self-sampling and joint quality tests with customers to inspect the quality of our crude oil and natural gas products. We have formulated the evaluation standards and process for customer access and always specify the mechanism for handling product quality issues in the procurement and sales contracts of crude oil and natural gas. Besides, we further improve our customer service management through follow-up visits to key customers to understand their requirements. In 2023, the quality of our products remained stable and met the national standards; no major disputes over product quality has occurred, and we have not received any customer complaint regarding the quality of our crude oil and natural gas. Should any quality complaints arise, the Company will communicate with the customer in accordance with international and national standards for the quality of crude oil, natural gas and other products, to handle the complaints properly.

Cyber Security

Abiding by the Cybersecurity Law of the People's Republic of China and other laws and regulations, we have established and improved management policies such as the Rules for Cybersecurity Incident Management. We have structured a cybersecurity framework which can be summarized as "one center, three lines of defense", carried out the phase II construction of the headquarters security operation center, established a cybersecurity management structure, clarified cybersecurity targets and management principles, and essentially achieved full-scope, dynamic, and real-time monitoring of the Company's information assets. Through measures such as special cybersecurity inspections, grade protection risk evaluation and industrial control system risk assessment, we have identified and solved the existing problems. We organized specialized publicity trainings and drills and improved the information system's risk resistance and privacy protection ability to enhance overall cybersecurity protection.

Technological Innovation

CNOOC Limited has implemented the innovation-driven development strategy and continuously strengthened scientific and technological innovation. We continue to increase research and development investment, constantly improving the level of scientific research. We also vigorously researched key and core technologies and achieved scientific and technological innovation breakthroughs. In addition, we improved precise incentives to fully stimulate the innovation vitality of researchers, improved the management mechanism for scientific research and innovation, and will continue to strengthen the leading and supporting role of scientific and technological innovation.

In terms of technological innovation and R&D application

·    In the Jinzhou 25-1 Oilfield W-1 area in the Bohai Sea, the main structure steel cylinder for the first domestic sub-seabed development model of oil and gas fields was successfully installed. This symbolized the key step forward for the model, which was independently designed by CNOOC Limited. It is significant to the development of the hundred million tons of oil and gas in the Bohai Sea, increasing reserves and production of oil and gas resources, and ensuring energy supply.

·    As the key technology in the Company's major project of "Two Increases and One Decrease", the flow field optimization and adjustment technology has made notable achievements in controlling natural decline rate and oilfield water-cut.

·    We implemented the integrated exploration and development plan of Linxing-Shenfu deep coalbed methane, completing the first demonstration project in exploration and development of deep coalbed methane. As a result, we effectively improved the designed annual productivity capacity.

·    We have achieved a significant breakthrough in the comprehensive study of carbonate fractures and proposed the integration of geology and engineeriing, to achieve efficient development and fast project construction. We thereby ended the history of 40 years without high production well in the area and providing strong support for the efficient and stable production of 300,000 barrels of oil per day in the Missan oilfield in Iraq.

·    We took the lead in tackling the problem of identifying the turbidite sandstone reservoirs in the deep play of Guyana, successfully developed the sandstone reservoir identification technology, realized the clear identification of the reservoirs in deep strata, and made two more 100-million-ton level oil and gas discoveries in deep strata.

Making Further Headway in Digital and Intellectual Transformation

·     China's first intelligent "Offshore Oil and Gas Processing Plant" with integrated coordination of onshore and offshore production and operation was delivered, which realized 24-hour monitoring, early warning, decision-making assistance and control optimization for offshore oil and gas production. This enables digital sharing for the integrated coordination of onshore and offshore intelligent production and operation, promoting the digital transformation and intelligence development of the energy industry.

·     "Shenhai-1" became the world's first large-scale ultra-deepwater semi-submersible oil production and storage platform with remote production capability. It can maintain continuous, safe and stable production during typhoons.

·     We accelerated the construction of intelligent offshore oil and gas fields, improved the level of production, operation and management, controlled safety risks and maximized economic benefits. The major results include the following:

1)The digitalization coverage of core business at the production site of Tianjin Branch’s Qinhuangdao 32-6 Smart Oilfield Phase II reached 90%, which contributed to the accumulated increase of oil production by nearly 100 thousand cubic meters;

2)Enping, Liuhua and other oilfields of Shenzhen Branch activated typhoon mode for production during typhoon and recovered crude oil losses of more than 170,000 tons and natural gas losses of more than 280 million cubic meters;

3)The transformation of Weizhou unmanned platform of Zhanjiang Branch and the construction of intelligent inspection of Weizhou terminal realized the unmanned and less manned operation of platforms, achieving the purpose of reducing staff and costs and improving quality, efficiency as well as safety control.

Energization of the Vitality of Researchers

In 2023, we further improved the reward mechanism of science and technology based on value contribution. We incentivized talents who dedicated themselves to the frontline of scientific research work and production technology development for a long time and made major contributions, promoting and creating an atmosphere that favors scientific research and innovation.

New Progress in the Management of Intellectual Property Rights

We act in strict compliance with laws and regulations such as the Patent Law of the People's Republic of China and Law of the People's Republic of China on Promoting the Transformation of Scientific and Technological Achievements and have revised and improved CNOOC Limited Intellectual Property Management Measures to maintain and guarantee the compliant management of intellectual property rights. Focusing on major technological achievements, we conduct patent analysis based on patent information, arrange demonstration application, and organize high-value patent selection in major areas. In addition, we have explored the pre-evaluation and fast pre-review mechanism for patent application and have improved the management, planning and protection of intellectual property rights to realize the full value of patents.

Important Awards

1 person won the 18th Li Siguang Geological Science Award (Field Award).

3 people won the Sun Yueqi Energy Science and Technology Award, including 1 Energy Award and 2 Youth Science and Technology Awards.

In 2023, we won a total of 9 science and technology awards at the provincial and ministerial level and above. The Innovation and Industrial Application of Key Technologies and Methods for Ultra-deepwater Drilling and Completion won the Science and Technology Progress Special Award - Grand Prize granted by the People's Government of Hainan Province.


Supply Chain Management

We focus on establishing an offshore oil modern supply chain and strive to achieve supply chain integration. We strengthen the forward-looking and proactive administration of our supply chain, steadily extending management to both the supply and demand ends.

In 2023, we amended the Supply Chain and Supplier Management Measures in accordance with laws and regulations such as the Law of the People's Republic of China on Tenders and Bids. We established the supplier whole-process management system with "origin management", "process management and control" and "results application", expanded the development of high-quality supplier resources, and enhanced classification and graded management to avoid suppliers' ESG risks. In addition, we formulated the CNOOC Limited Overseas Institutions Supply Chain Classification Management Guidance and the procurement policy for overseas institutions' for the purpose of classification management of their supply chains.