CNOOC Limited (CNOOC) and Sinopec International Petroleum Exploration and Production Corporation (Sinopec) announced the acquisition of a 20% stake in Block 32, offshore Angola, in a 50:50 joint venture. The acquisition represents the equivalent of 6% of CNOOC's total FY 2008 reserve base and is in line with CNOOC's strategy of accumulating new reserves across the globe. This acquisition will support top-line growth in the…

We believe the company will realize lower average realized prices, in line with our anticipation of a drop in hydrocarbon prices, which will offset the increase in production volumes over our investment horizon. Hence we expect the company to register a y-o-y decline in revenues during FY 2009. CNOOC’s operating margin is set to decline y-o-y, primarily due to an increase in operating expenses on the back of the growth in production volumes in FY 2009. We expect CNOOC…

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CNOOC Limited (CNOOC) announced today its business strategy plan for FY 2009, which increased its capital expenditure (capex) as well as production guidance for the year. Given this renewed capex and production guidance, we maintain our BUY rating until we fully reassess the company after it announces FY 2008 results in March 2009. We maintain the ADR rating a BUY based…