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CNOOC to increase production, cut capital spending by 35 percent

Staff writer |
The Chinese offshore oil and gas producer CNOOC said it is aiming for an up to 14.6 percent increase in output this year but will slash capital spending by as much as 35 percent in response to the recent plunge in oil prices.

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An over 50 percent slide in crude prices since June due to slowing global demand and growing US shale output is putting a heavy burden on oil companies around the world.

The slump has wiped billions of dollars from their stock market values in recent months, and squeezed the spending of many oil majors.

In a filing with the Hong Kong bourse, CNOOC said its capital expenditure will fall 26-35 percent to 70 billion to 80 billion yuan ($11.19 billion to $12.79 billion) this year, the first such decline since 2010.

The spending cuts are deeper than some analysts' estimates of 8 percent. Other major Chinese oil firms PetroChina and Sinopec are also expected to unveil lower budgets for 2015 when they release their annual results in late March.

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