British energy giant
) has teamed up with China National Offshore Oil Corp (CNOOC) -
China's largest offshore explorer in the South China Sea.
A production sharing agreement was inked between the two
companies relating to Block 54/11 in the deepwater Pearl River
Mouth Basin, South China Sea. However, the financial terms were
not revealed in the agreement.
The block spans 4,586 square kilometers and lies in water depths
ranging from 370 meters to 2,300 meters. Block 54/11 will be
operated by CNOOC with a majority stake of 51%. BP will be
responsible to bear the exploration costs of the block, which is
close to its existing deepwater interests in Blocks 43/11 and
The deal reveals China's ability to develop its own oil and gas
reserves and at the same time acquire stakes in projects around
the world. The new acreage is an addition to BP's deepwater
portfolio in the South China Sea and extends its relationship
Both blocks 42/05 and 43/11, are in the exploration phase and
were awarded to BP in 2010 and 2011, respectively. BP's presence
in China dates back to the 1970s. Currently, the British giant
operates 17 active joint ventures and wholly owned BP business
entities in the region. The company had already invested about
$4.9 billion at year-end 2012.
London, England-based BP is one of the world's largest energy
companies, providing customers with fuel for transportation,
energy for heat and light, retail services and petrochemical
products. It operates in three segments: Exploration and
Production, Refining and Marketing, and Other Businesses and
For 2013, the company expects refining margins to experience a
downfall from the 2012 level due to turnaround activity. The
company's petrochemicals margins are also expected to remain weak
BP carries a Zacks Rank #3 (Hold). However, stocks that can be
considered as good buying options include Zacks Ranked #1 (Strong
Memorial Production Partners LP
Gulfmark Offshore, Inc.
Natural Gas Services Group Inc.
BP PLC (BP): Free Stock Analysis Report
GULFMARK OFFSHR (GLF): Free Stock Analysis
MEMORIAL PRODUC (MEMP): Free Stock Analysis
NATURAL GAS SVC (NGS): Free Stock Analysis
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