Upstream Exploration & Production
As one of the world’s leading E&P companies with a globally diversified portfolio, one of ConocoPhillips’ key strengths is our demonstrated ability to find new resources and develop energy safely, efficiently and responsibly.
Since arriving in China in 1981, ConocoPhillips has been one of the largest foreign investors in China’s upstream oil and gas sector and established a successful track record by working closely with our Chinese business partner China National Offshore Oil Corporation (CNOOC).
Our involvement and partnership started when Phillips Petroleum Company (Phillips), a predecessor of ConocoPhillips, was invited to explore the Pearl River Mouth Basin offshore Guangdong in 1981. Phillips subsequently became the first foreign operator and discovered the Xijiang Oilfield in the 1980s. Since then, we have signed several offshore Production Sharing Contracts (PSCs) with CNOOC, leading to several large commercial discoveries and years of mutual benefits.
In 1994, we joined hands with CNOOC to discover and develop the Penglai Oilfield -- China’s largest offshore oilfield, located in the southern part of the Bohai Sea. The Penglai Oilfield is structurally complex, with a large oil-bearing interval and a high degree of lateral and vertical variability, posing distinct development challenges. ConocoPhillips China and CNOOC have executed a phased development strategy and harnessed innovation and technological breakthroughs to overcome these complexities. Since production first began in 2002, ConocoPhillips China and CNOOC have jointly invested multiple billions of U.S. dollars at Penglai Oilfield and collaboratively built and installed sixteen offshore platforms and a 300,000-tonne floating production storage and offloading vessel (FPSO), one of the world’s largest, enabling the Penglai Oilfield to be recognized as an industry pioneer.
In 2014, ConocoPhillips China entered a new era of collaboration with CNOOC, as we successfully transferred operational control of the Penglai Oilfield to CNOOC per the terms of the PSC.
The oil field is still under various phases of development, as the two companies expect a long production life ahead.
In October 2023, the Penglai Oilfield Phase 4B Project achieved its first production, greatly increasing the production capacity of the field. In Q1 2024, ConocoPhillips China and CNOOC proudly announced that Penglai exceeded 500 million barrels in cumulative crude oil production, which could meet the basic energy needs of 200 million people for one year and demonstrate the field’s large production capacity as a strong and secure source of energy supply for China. In April 2024, we celebrated the successful completion of the 1,000th cargo lifting operation, which is another significant milestone in the Penglai Oilfield’s history.
We are proud to help China develop and manage such a massive world-class operation by working together with CNOOC. Currently, the two companies are moving forward with the next phase of development in Penglai to further unlock its potential and production capacity.
Beyond Bohai, ConocoPhillips is also actively seeking exploration opportunities with Chinese partners, further securing energy supplies for the present and future of China’s economic growth.