Cnooc Net Rises to Record on China Demand, Oil Prices

Cnooc Ltd., China's biggest offshore oil producer, said first-half profit rose 38 percent to a record because of soaring energy prices and demand in the world's fastest-growing major economy. Net income increased to 16.3 billion yuan ($2.04 billion), or 0.39 yuan a share, from 11.8 billion yuan, or 0.29 yuan, a year earlier, the company said in a statement today. Profit beat the 15.6 billion yuan median estimate in a Bloomberg News survey of seven analysts. Rising earnings have given Chairman Fu Chengyu cash to seek oil and gas reserves in Asia and Africa, where Beijing-based Cnooc spent $2.7 billion buying Nigerian fields this year. China's third-largest oil company increased profit at a faster pace than bigger rivals PetroChina Co. and China Petroleum & Chemical Corp., which lost money at their refineries.

Total oil and gas production rose 7.4 percent to the equivalent of 81.7 million barrels of oil. Output from fields off China rose 7.2 percent to the equivalent of 74.4 million barrels of oil. The company made six new oil and gas discoveries in the first half of this year and started production at four oil and gas projects, Cnooc said in the statement. Cnooc increased earnings even as a shortage of equipment delayed repairs at a South China Sea field that accounts for about 5 percent of its output.