Chinese oil company CNOOC has signed a production sharing contract with Canada’s Husky Energy for a block in the South China Sea.
The Block 16/25 is located in the Pearl River Mouth Basin about 150 kilometers southeast of the Hong Kong Special Administrative Region. The block covers a total area of 44 square kilometers with a water depth of 100 meters.
According to the terms of the PSC, Husky will act as the operator during the exploration period and conduct exploration activities in the block mentioned above, in which all expenditures incurred will be borne by Husky.
Once entering the development phase, CNOOC has the right to participate in up to 51% of the participating interest in any commercial discoveries of the block.
After signing the above-mentioned PSC, except for those relating to CNOOC’s administrative functions, CNOOC will assign all of its rights and obligations under PSC to CNOOC China Limited, a subsidiary of CNOOC Limited.
Husky said it expected to drill two exploration wells on the shallow water block during the 2018 timeframe, in conjunction with two planned exploration wells at the nearby exploration Block 15/33.
Husky is not a newcomer to the South China Sea. Its current projects there include the producing Liwan Gas Project, a 40 percent working interest in the Wenchang oil field.
Offshore Energy Today Staff