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Chinese oil giant CNOOC Limited (CEO - Free Report) has made a mid-sized natural gas discovery – Bozhong 22-1 – in Bohai recently.

Located in the south central Bohai, Bozhong 22-1 lies in average water depth of about 25 meters. Drilled and completed at a depth of 4,611 meters, the discovery well, hit a gas reservoir with a total thickness of about 9 meters.

The well was tested at gas production of about 142 million cubic feet per day. The latest find at Bozhong 22-1 validates the prospects of buried hills for future gas exploration of the south slope in Bozhong Sag.

Recently, the company discovered a 55-meter gas reservoir at Lingshui 17-2-1 probe in South China Sea. The discovery marked the first breakthrough on the independent deepwater exploration in the South China Sea’s Qiongdongnan basin.

CNOOC is one of the three leading oil companies in China and one of the largest independent oil and gas exploration and production companies of the world. It is China’s dominant producer of offshore crude oil and natural gas and engages in the exploration, development, production, and sale of crude oil, natural gas, and other petroleum products. CNOOC Ltd. is the only company permitted to conduct exploration and production activities with international oil and gas companies off the shores of China.

We remain positive on CNOOC’s performance, which reflects its premium assets portfolio, excellent execution strategy, unique position as a pure oil player and potential transactions in the merger and acquisition space.

CNOOC’s growth profile should get a boost over the next 3 to 5 years from numerous development projects offshore China, international growth from recent acquisitions, and intensive exploration and development programs with its partners.
CNOOC currently carries a Zacks Rank #4 (Sell). However, there are Zacks Ranked #1 (Strong Buy) stocks in the oil and gas sector – Helmerich & Payne, Inc. (HP - Free Report) , Valero Energy Corporation (VLO - Free Report) and Patterson-UTI Energy Inc. (PTEN - Free Report) – that appear rewarding for the short term.

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