China's CNOOC Ltd is poised to invest aggressively in oil and gas exploration in the South China Sea from now until 2025, targeting a significant production boost in its western area.

CNOOC Zhanjiang, the local company responsible for E&P in the western South China Sea, has budgeted annual spending of 16 billion yuan ($2.25 billion), part of which will go towards drilling 50 exploration and production wells over the next six years.

A senior Zhanjiang official told media in China last week that from now until 2025, the company will put 14 offshore oil and gas fields into operation, which will be able boost production by 60 million to 80 million barrels of oil equivalent, up from the current output of approximately 73.5 million boe.

The new fields under development include deep-water Lingshui 17-2 in the Qiongdongnan basin, plus the Wushi, Haizhong and Leidong oilfields.

Current production is from 31 oil and gas fields serviced by 48 offshore production platforms, four floating production, storage and offloading vessels, subsea pipelines spanning close to 2000 kilometres and four onshore terminals. Sources said first gas from Lingshui 17-2 is now expected towards the end of 2021, one year behind the original schedule, in part due to delays in the provision of subsea equipment.

“The project is now 22.47% completed,” said a Zhanjiang official.

The drilling of production wells will be completed in the second half of this year.

Drilling at Lingshui by the semi-submersible drilling rig Bluewhale 1 involves 11 production wells.

Oslo-listed Aker Solutions earlier won a contract to supply 11 horizontal trees, four manifolds, topsides, a subsea control system and more than 70 kilometres of umbilicals.

Located in the Qiongdongnan basin near Hainan island, and in water depths of up to 1560 metres, the Lingshui 17-2 development includes a subsea production system for the 11 wells, with one manifold in the west and three in the east, all tied back to a large semi-submersible platform.

Expected gas throughput is estimated at 3.3 billion cubic metres per annum of gas and 1400 cubic metres per day of condensate.

Gas will be partly moved to Hong Kong to power electricity utilities via an existing pipeline linking Hong Kong and the existing Yacheng 13-1 gas field.

In the eastern part of the South China Sea, CNOOC Ltd will increase oil production to 147 million barrels per annum from the current 110.25 million barrels.

Here, CNOOC Ltd is developing the Liuhua oil complex, which lies in water depths of 392 to 429 metres.

CNOOC Ltd and operator Husky Energy of Canada are also working to develop the Liuhua 29-1 deep-water gas field where first gas is expected at the end of 2020.

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South China Sea output boost on CNOOC agenda