China's dominant producer of offshore crude oil and natural
) first half 2013 net profit increased 7.9% year over year to
34.38 billion yuan (US$5.58 billion), or 0.77 yuan per share,
attributable to growth in production volume.
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Total revenue in the period was 139.03 billion yuan (US$22.55
billion), up 17.6% year over year. Oil and gas sales were 110.80
billion yuan ($17.97 billion), up 15.8% year over year.
In the first half of 2013, CNOOC achieved net production of 198.1
million barrels of oil equivalent (MMBoe), up approximately 23.1%
from the year-ago level. The improvement was mainly attributable
to the production contribution from the acquisition of Nexen Inc,
the new oil and gas fields, resumption of production at Penglai
19-3 oilfield, and ramp-up of Eagle Ford and Missan oilfields.
Without Nexen's production output, the production growth was
7.7%. Overseas production and steady performances by the already
operational oil and gas fields also aided the increase.
The company's average realized oil price decreased 10.9% year
over year to $104.20 per barrel. Realized gas price decreased
3.7% to $5.68 per thousand cubic feet (Mcf) from the year-ago
CNOOC's capital expenditure in the first half of 2013 was $5.21
billion, representing an increase of 34.8% from the year-earlier
CNOOC's full-year 2013 production target of 338-348 mm barrels of
oil equivalent (Boe) (excluding Nexen) remains unchanged. Nexen's
production contribution for 2013 is expected to reach
approximately 59 mm boe.
We remain optimistic on CNOOC as its performance reflects its
premium assets portfolio, excellent execution strategy, unique
position as a pure oil play and potential transactions in the
merger and acquisition space.
Again, CNOOC completed the acquisition of Canadian energy
producer Nexen Inc. for approximately $15.1 billion in cash, in
Feb 2013. The company in the first half of 2013 made 7
discoveries and announced 18 successful appraisal wells offshore
China, and 1 discovery overseas.
The company currently holds a Zacks Rank #3 (Hold). However, the
Zacks Ranked #1 stocks of
Abraxas Petroleum Corp.
Oiltanking Partners, L.P.
Seacor Holdings Inc.
) are expected to outperform the market over the next few months.