China’s CNOOC starts Caofeidian, Wenchang crude output

: Crude oil, Natural gas
25/03/17

Chinese state-controlled CNOOC has started output at the Caofeidian 6-4 oil field comprehensive adjustment project and the Wenchang 19-1 oil field phase 2 project offshore China, the company said today.

Caofeidian 6-4 produces mainly light crude and is located in the western part of the Bohai Sea, at an average water depth of about 20m. Wenchang 19-1 produces mainly medium crude and is located in the western part of the Pearl River Mouth Basin, at an average water depth of around 125m.

Caofeidian 6-4 is expected to achieve peak production of around 11,000 b/d of oil equivalent (boe/d) in 2026 and Wenchang 19-1's output is expected to peak at 12,000 boe/d in 2027.

CNOOC plans to put into production a total of 38 development wells at the two projects. It is also planning 22 production wells at Caofeidian 6-4.

CNOOC is the operator of the projects and holds a 100pc interest.

The associated gas of Caofeidian 6-4 will be reinjected into the reservoir with gas injection compressors, which will reduce CO2 emissions by about 13,000 t/yr. Wenchang 19-1 uses a megawatt-level high-temperature flue gas ORC power generation unit, which is expected to generate up to 24GWh of electricity and reduce CO2 emissions by about 23,000 t/yr, CNOOC said.

The company has mainly started output at oil fields in 2025 but said in early March that it made a "major breakthrough" in natural gas exploration as part of a gas discovery at the Weizhou 10-5 oil and gas field at a water depth of 37m in the Beibu Gulf basin in the Bohai sea, with test results indicating production capacity of around 13.2mn ft³ of gas and about 800 b/d of crude.

Related news posts

Argus illuminates the markets by putting a lens on the areas that matter most to you. The market news and commentary we publish reveals vital insights that enable you to make stronger, well-informed decisions. Explore a selection of news stories related to this one.

25/03/17

Trump actions fuel trading uncertainty

Boca Raton, 17 March (Argus) — President Donald Trump's unpredictable actions on tariffs, foreign affairs and the economy are creating volatility in futures markets at a time of increased concerns about the stability of investments made in the US. Trump has roiled global markets by announcing — and sometimes retracting the same day — tariffs on Canada, Mexico, China and other trading partners without offering a clear explanation of what outcome he hopes to achieve. The Chicago Board Options Exchange's VIX volatility index, which uses options trades to track the likelihood of major stock market swings, has nearly doubled since Trump took office and hit a seven-month high last week. The pace and breadth of Trump's agenda are "surprising even his most ardent supporters" and resulted in markets having "mixed feelings" over his policies, Futures Industry Association president Walt Lukken said on 10 March at the International Futures Industry Conference in Boca Raton, Florida. According to a recent survey, the industry group's members identified tariffs as the top policy that could negatively affect markets, Lukken said. Trump's oft-stated desire to annex Greenland and Canada and his willingness to allow carmaker Tesla's chief executive, Elon Musk, to exert vast power in his administration without a clear conflict-of-interest policy have helped rattle investor confidence, European exchange Euronext chief executive Stephane Boujnah said on the sidelines of the conference. US assets could start trading at a discount because of concerns over the rule of law and an "oligarch risk" that usually exists in emerging markets, he said. "One of the features of the emerging market is that you invest, you own something, until the guy with gold who is close to the ruler wants it too," Boujnah said. Traders who in the past might have stayed away from markets during periods of volatility no longer have the "luxury to do that in the world that we live in today", CME Group chief executive Terrence Duffy said. "Globally, it's not going to go away, so it's something we all need to deal with," Duffy said. CME reported record trading volumes for natural gas futures and options in January and February, which company executives have attributed in part to years of growing US energy exports. "As the US continues to both produce and export crude and natural gas at record quantities, putting US physical products on the market, customers are coming to the main market to hedge that exposure," CME commodities global head Derek Sammann said on the sidelines of the conference. Double-edged sword Higher volatility can benefit exchanges, trading platforms and traders because their revenue is often tied to trading volumes. But too much volatility in markets can cause some traders to sit on the sidelines, resulting in increased price spreads between buyers and sellers, trading platform Trading Technologies executive vice-president of futures and options Alun Green said. "We're still in a well-established, well-worked volatile market, but I think that there are some areas where people are not quite as willing to go in and take risks," Green said. Trump's push for an across-the-board cut to regulations and his attempt to wrest control of the independent federal agencies that oversee financial markets could end up causing problems in markets if they eventually result in a market crash, according to some regulators. "I do fear sometimes when we whipsaw too much, that then things can get deregulated too much, and then we create some amount of risk that we then can't handle," US commodities regulator CFTC member Christy Goldsmith Romero, a Democratic appointee, said. By Chris Knight Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

US oil chiefs wary of Trump price push

25/03/17

US oil chiefs wary of Trump price push

New York, 17 March (Argus) — US oil chiefs have offered President Donald Trump their unequivocal backing for restarting the conversation around energy policy and climate change in their favour, but his push for lower oil prices is creating misgivings. Energy secretary Chris Wright told reporters at the CERAWeek by S&P Global conference in Houston last week that the administration's push for lower oil prices has no specific target level, but White House officials, including trade adviser Peter Navarro, have cited $50/bl as a preferred level that would help to bring down inflation. A decline to that level would have far-reaching repercussions for the shale patch and lead to lower production in the top-performing Permian basin, according to industry veteran Scott Sheffield. "The cash breakeven for the majors and independents is $50-55/bl including dividends," said Sheffield, one of the pioneers of the shale revolution in the Permian basin that turned the US into the world's biggest producer. "So at $50/bl oil, there's no free cash flow, there's no growth." Wright attempted to square the circle between Trump's call for lower crude prices and higher crude production at the same time, arguing that both goals could be achieved by removing barriers and developing more infrastructure under a strategy of "Build, baby, build". Executives from the US and European majors talked up prospects in the offshore Gulf of Mexico, which is enjoying a resurgence in interest as pioneering technology opens up previously inaccessible resources. But the industry needs to work with the administration to explain the unintended consequences of its tariff policies, pipe manufacturer Tenaris said, as they affect equipment used for deepwater development. In the shale, with most public operators pledging to keep spending down this year and growth to a minimum, few have thus far shown any appetite to open the floodgates. US major Chevron might forecast double-digit output growth from its Permian operations this year, but it is slowing its spending. "Chasing growth for growth's sake has not proven to be particularly successful for our industry," chief executive Mike Wirth said. "And so we're moving towards a plateau that will open up the free cash flow generation and then sustain that for a long period of time." Tech flows Consolidation has helped to improve financial performance and efficiency of the larger operators now dominating the Permian, giving them the ability to drive technology gains and improve recovery rates, according to ExxonMobil's new head of oil and gas production, Dan Ammann. "When you have a position like ours — with continuous acreage — it allows you to do things that others are unable to do, like very long laterals," he told the conference. "Today we are recovering 6-8pc of the total resource, so the ability to unlock increased recovery of that through technology is a great way to grow production." Occidental Petroleum's chief executive, Vicki Hollub , is advocating the use of enhanced oil recovery techniques with CO2 pulled in by direct air capture facilities — which remove CO2 from the atmosphere — like the projects Occidental is developing. Pilot tests in the Midland basin suggest the company could double recovery rates using this technique for shale, Hollub said. And even though growth in shale output looks set to reach a plateau by the end of the decade, industry leaders voiced optimism that its decline will be slow and future drilling breakthroughs, possibly driven by artificial intelligence, could yet prolong its lifespan. "Never bet against this industry in terms of technology," ConocoPhillips' chief executive, Ryan Lance, warned. "It will always figure out a way to get more resource out of the rock." By Stephen Cunningham US tight oil production Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Oil industry embraces Trump trade-offs

25/03/17

Oil industry embraces Trump trade-offs

Washington, 17 March (Argus) — President Donald Trump's key energy advisers lavished praise and promises of deregulation on US oil and gas executives attending the CERAWeek by S&P Global conference in Houston last week. But his domestic and international policies, and failure to explain their desired outcomes, have created significant uncertainty for investors in the energy sector and the broader economy. "I'm going to share two words that I don't think you have heard from a federal official in [former president Joe Biden's] administration during the last four years, and those two words are ‘Thank you'," interior secretary Doug Burgum told the conference. Burgum, appointed by Trump as chairman of a newly formed National Energy Dominance Council, projects that cutting oil and gas regulations and streamline permitting could trim $6-8/bl from US oil production costs. Burgum's assessment of the savings that the regulatory overhaul would yield is a way to reconcile Trump's demands on the industry to lower oil prices and at the same time push US crude output beyond what are already record levels. Trump on 12 March celebrated oil prices falling to $65/bl as another major win — even though Nymex sweet crude futures were closer to $70/bl that day — and some members of his economic team are eyeing the $50/bl mark . His energy team says it does not have a specific price target, but "the actions of this administration are to make it easier to produce more oil and natural gas" and encourage producers to invest more, energy secretary Chris Wright told the CERAWeek conference. Oil and gas executives for now appear grateful to be embraced by the White House, and attribute government interventions on trade and other fronts to the initial exuberance of a new administration. Wright's denunciation of what he called Biden's "irrational, quasi-religious climate policies" was well received and set the tone for the conference. Even Adnoc chief executive Sultan al-Jaber , who just two years ago labelled his fellow oil executives' view on climate change as problematic, recast the problem and pronounced it to be solved. "The world is finally waking up to the fact that energy is the solution," al-Jaber said. Permitting pay-offs later... But concerns about new sources of regulatory uncertainty are starting to mount. Approving specific pipeline and other energy projects by executive fiat needs to be backed by legislation that makes permitting reform possible, Chevron chief executive Mike Wirth told the conference. And Trump is making it increasingly difficult to pass off his tariff policies as a mere negotiating tactic. His trade actions are proving to be sticky — even the temporary relief for Canada tariffs has forced market participants to scramble to prove that the energy trade is covered by the US-Canada-Mexico free trade agreement terms and is thus tariff-free, Alberta's minister of energy and minerals, Brian Jean, said. OECD energy watchdog the IEA on 13 March downgraded its global oil demand growth forecast for 2025, noting a deterioration in macroeconomic conditions driven by rising trade tensions. The agency envisages a larger supply surplus as a result — a surplus that could be greater still, depending on Opec+ policy. The Trump administration casts its declaration of an "energy emergency" as the best way to address long-standing complaints across the energy industry about the lengthy permitting process and multiple layers of federal and state-level oversight. "We will identify where the overlap is, we will identify where the overreach is... then we're going to help solve the problem and identify what else we can just get rid of in the federal government," Burgum told the conference. But he and other administration officials have already indicated that they expect the main beneficiaries to be the oil, gas and coal industries, making it easier to expand production, authorise pipelines and approve new coal and gas-fired power plants, and to even force coal-fired plants that have already been mothballed to reopen. The Environmental Protection Agency on 12 March said it will revise more than 30 climate regulations that were issued under Biden, including CO2 limits for power plants and automobiles, national air quality standards and methane limits for the oil and gas sector. Midstream company Williams' chief executive, Alan Armstrong, said that the permitting shortcuts outlined by the Trump administration would more than offset the higher cost of steel used in pipes as a result of new tariffs . Armstrong, who estimates permitting costs to be twice as high as the cost of pipeline materials, said that "we'd be glad to pay the 25pc tariffs as long as we can get the permits done". He also said he is hopeful that durable legislation relaxing infrastructure permitting rules will be passed under the new administration. But industry group American Petroleum Institute president Mike Sommers, while praising Trump's deregulation agenda, offered a more sober outlook on the possibility of a long-discussed overhaul of federal permitting through federal legislation. Congress' failed effort to amend permitting laws last year "should be the basis upon which all other permitting bills are built", Sommers said. But, he cautioned, "we all have to be realistic about the partisan make-up of Congress and the difficulty of getting 60 votes" in the Senate, where the Republican majority is 53-47. The new gas-fired power plants and nuclear power investment that Trump wants might prove insufficient for meeting surging US power demand for artificial intelligence (AI) data centres this decade, US utility NextEra chief executive John Ketchum said, noting his company's continued preference for adding renewable generation. "There's a timing difference… and there's a cost difference" between renewables and other generation sources, Ketchum said, noting that the cost of new gas-fired generation has more than tripled since 2022. ...uncertainty now Oil and gas producers might feel reinvigorated by Trump's promise of deregulation, but energy traders say that his unpredictable actions on tariffs, foreign affairs and the economy are creating volatility in futures markets at a time of increased concern about the stability of investments made in the US. The Chicago Board Options Exchange's VIX volatility index — which uses options trades to track the likelihood of major stock market swings — has nearly doubled since Trump took office and hit a seven-month high last week. The pace and breadth of Trump's agenda are "surprising even his most ardent supporters" and resulting in markets having "mixed feelings" over his policies, Futures Industry Association president Walt Lukken said on 10 March at the International Futures Industry Conference in Boca Raton, Florida. Lukken cited a recent survey of the industry group's members, which identified tariffs as the policy that could most negatively affect markets. Trump's oft-repeated stated desires to annex Greenland and Canada and his willingness to allow Tesla chief executive Elon Musk to exert vast power in his administration without a clear conflict-of-interest policy have helped to further rattle investor confidence, European exchange Euronext's chief executive, Stephane Boujnah, said. US assets could start trading at a discount because of concerns over the rule of law and an "oligarch risk" that more usually exists in emerging markets, he said. "One of the features of the emerging market is that you invest, you own something, until the guy with gold who is close to the ruler wants it too," Boujnah said. By Haik Gugarats, Julian Hast and Chris Knight Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Dangote refinery buys first cargo of Eq Guinea crude

25/03/13

Dangote refinery buys first cargo of Eq Guinea crude

London, 13 March (Argus) — Nigeria's 650,000 b/d Dangote refinery has bought its first cargo of Equatorial Guinea's medium sweet Ceiba crude, according to sources with knowledge of the matter. Dangote bought the 950,000 bl cargo loading over 12-13 April from BP earlier this week, sources told Argus . Price levels of the deal were kept under wraps. Most Ceiba exports typically go to China. Around 18,000 b/d discharged there last year, while three shipments went to Spain and one to the Netherlands, according to Vortexa data. This year, two cargoes loading in February and March are signalling Zhanjiang in China, according to tracking data. Traders note that buying a Ceiba cargo is part of Dangote's efforts to diversify its crude sources. Last month the refinery bought its first cargo of Algeria's light sweet Saharan Blend crude from trading firm Glencore, which is due to be delivered over 15-20 March. Market sources said Dangote seems to have sourced competitively priced crude from Equatorial Guinea at a time when domestic grades are facing sluggish demand from Nigeria's core European market amid ample supply of cheaper Kazakh-origin light sour CPC Blend, US WTI and Mediterranean sweet crudes. Several European refineries are due to undergo maintenance in April, which is also weighing on demand. Nigeria's state-owned NNPC is currently in negotiations with the Dangote refinery about extending a local currency crude sales arrangement , which involves crude prices being set in dollars and Dangote paying the naira equivalent at a discounted exchange rate. Any changes to the terms of the programme may pressure Dangote to increase the amount of foreign crude in its slate. Refinery sources told Argus in January that Dangote will source at least 50pc of its crude needs on the import market and is building eight storage tanks to facilitate this. By Sanjana Shivdas Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Nigeria's port authority raises import tariffs

25/03/13

Nigeria's port authority raises import tariffs

London, 13 March (Argus) — The Nigerian Ports Authority (NPA) has raised tariffs by 15pc on imports "across board", taking effect on 3 March, according to a document shown to Argus . The move comes as the independently-owned 650,000 b/d Dangote refinery continues to capture domestic market share through aggressive price cuts, pushing imported gasoline below market value in the country. Sources said that Dangote cut ex-rack gasoline prices to 805 naira/litre (52¢/l) today, from between 818-833N/l. The rise in NPA tariffs may add on additional cost pressures onto trading houses shipping gasoline to Nigeria, potentially affecting price competitiveness against Dangote products further. The move would increase product and crude cargo import costs, according to market participants. But one shipping source said the impact would be marginal as current costs are "slim", while one west African crude trader noted that the tariffs would amount to a few cents per barrel and represent a minor rise in freight costs. Port dues in Nigeria are currently around 20¢/bl, the trader added. One shipping source expects oil products imports to continue to flow in, because demand is still there. Nigeria's NNPC previously said the country's gasoline demand is on average around 37,800 t/d. Over half of supplies come from imports, the country's downstream regulator NMDPRA said. According to another shipping source, Dangote supplied around 526,000t of gasoline in the country, making up over half of product supplied. The refinery also supplied 113,000t of gasoil — a third of total total volumes in the country — and half of Nigeria's jet at 28,000t. By George Maher-Bonnett and Sanjana Shivdas Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Business intelligence reports

Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.

Learn more