China plans to invest in mature fields to boost production
Time:2024-10-22
China’s big three―PetroChina, Sinopec and Cnooc―are raising combined capital expenditure to about 517 billion yuan ($77 billion), up 18% from last year. That’s almost back to levels seen before oil’s collapse in 2014, after President Xi Jinping ordered them to focus on raising domestic output to bolster national energy security.
Their spending plans contrast with global titans such as Royal Dutch Shell and Chevron, who are keeping a tight grip on spending and returning cash to investors via dividends and share buybacks. Meanwhile, Exxon Mobil is pouring money into world-class assets that will raise output in the coming years, including Guyana, Papua New Guinea and Brazil, as well as the Permian basin.
That’s not the case for the Chinese producers working mainly with costly wells and aging fields at home. PetroChina, the biggest, is focusing its exploration efforts in Xinjiang, where per-well spending could be 10 times higher than other fields, Huatai Financial Holdings estimates.
