China's CNOOC Q1 net income doubles, domestic output jumps

CHINA’S top offshore oil and gas producer CNOOC's net income more than doubled during the first quarter of 2022 from a year ago, on the back of a surge of global oil prices and increase of domestic oil and gas production.

The listed arm of the state-backed CNOOC Group reported its revenue rose 74 per cent year-on-year to 90.9 billion yuan (S$19 billion) over the January-March period, with net income up 132 per cent to reach 34.3 billion yuan, according to a company report filed to the Hongkong Stocks Exchange on Thursday (Apr 28).

Realised oil prices at CNOOC in the first quarter surged 65 per cent from a year ago to US$97.47 per barrel and gas prices rose 24 per cent to US$8.35 per thousand cubic feet.

Global oil benchmark Brent has jumped more than 30 per cent to US$105 a barrel since the beginning of the year, stoked by fears over supply disruption in the absence of Russia cargos.

Continued tight fuel supplies are expected to support refiners’ profits globally. Refining margins in Singapore, a bellwether for profits at export-oriented refineries in Asia, hit an all-time high of US$19.12 a barrel in April as Western sanctions hit Russian supplies while global oil inventories are at multi-year lows.

CNOOC’s total net production during the period was 151 million barrels of oil equivalent (boe), up 10 per cent year-on-year, with domestic output gaining 15 per cent and overseas output dipping 3 per cent.

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China has set targets to raise domestic crude oil production by 5 million tonnes and natural gas output by at least 23 billion cubic metres in 2022, echoing the exhortation of President Xi Jinping that “China’s energy bowl must be firmly held in its own hands”.

Reuters reported that CNOOC is preparing to exit its operations in Britain, Canada and the United States, because of concerns in Beijing the assets could become subject to Western sanctions.

The firm started trading on the Shanghai Stock Exchange last week after being forced to delist in the United States on national security grounds. REUTERS