BEIJING, June 9, 2000 --- CNOOC Limited (the "Company") is pleased to announce CNOOC Ltd. has signed Amendment Agreement with Primeline Energy Holding Inc. to modify the terms of the original Petroleum Contract of exploring oil in a 4,578 sq km block in the East China Sea.

The block 32/32 lies in the East China Sea area, which is the least explored area which the Company expects to become an important natural gas production base in the future.

Under the terms of the Amendment Agreement, CNOOC will fund the appraisal program of the Lishui 36-1 discovery and future exploration program in Block 32/32. In return, CNOOC will be entitled to 85% participation interest (increased from 51% no cost equity stake prior to any field development in the original Petroleum Contract,) with Primeline participation interest becoming 15%.

The Company and Primeline have sealed a Joint Operating Agreement so as to guide the conduct of exploration, development and production operations.

Under the Amendment Agreement, the Company has committed to fund the drilling of two wells in the next phase of the work program, the first one to commence within the next few weeks.

Mr. Ke Ru, Executive Vice President, Exploration said: "The wells aim to establish the commercially recoverable gas reserves in Lishui 36-1 discovery and to provide sufficient data to allow for the formulation of the field development plan. This area is located east of Shanghai, an area that has experienced rapid economic growth in recent years and it is important to our company natural gas development strategy."

CNOOC Limited is the largest producer of oil and gas offshore China and is one of the largest independent oil and gas exploration and production companies in the world with the net proved reserve of approximately 1.8 billion as of the December 31, 1999.