China National Offshore Oil Corp (CNOOC) will trim annual investment by 10% to 15% in 2020, while maintaining its goal of increasing domestic crude oil and natural gas production for the year, the company said in a statement on Wednesday.
CNOOC Ltd 0883.HK, a listed arm of the national offshore energy producer, said during a media briefing in late March the firm will “significantly” cut capital expenditure.
Oil and gas companies worldwide are reducing spending this year following a collapse in oil prices and plummeting fuel demand amid the coronavirus outbreak.
CNOOC did not give any further details on its capital expenditure plan or on its oil and gas production targets for its domestic and overseas blocks.
It will cut total costs by a least 10% and reduce losses at its money-losing firms by 5 billion yuan ($710 million) in 2020, the statement said.
The company did not give details on the unprofitable businesses. One of its big loss-makers, however, is its gas and power unit, and the company said in March it is set to have its Hong Kong-listed flagship take over that sector.
Capital expenditures at the Hong Kong-listed firm were 79.6 billion yuan in 2019.
The company said in January it would raise 2020 production to 525 million barrels of oil equivalent at both domestic and overseas projects from 506.5 million barrels in 2019. The focus would be on raising domestic output while cutting overseas operations, it said.
CNOOC’s businesses besides oil and gas production include oil refining, petrochemicals manufacturing, liquefied natural gas (LNG) terminals and renewable energy generation.
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