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Foreign giants are gearing up to further tap China's offshore reserves since the country's top offshore oil firm opened an unprecedented number of blocks for international collaboration. 

"Our exploration and production (E&P) department is busy conducting feasibility studies on relevant documents on CNOOC's blocks offered. We are still waiting for study results to make a decision as to get involved or not," Catherine Min, Total China's vice-president of communications, told China Daily on Friday.

Besides the 22 blocks, Total is in close contact with CNOOC on several other offshore projects in China, Min said without elaborating.

This year, 22 blocks covering an area of 114,050 square kilometers are available for international cooperation, China National Offshore Oil Corp (CNOOC) said in a public notice. It is largest-ever offer for international cooperation in the country's oil and gas E&P.

"BP is among the first multinationals operating in China and is CNOOC's partner in the Yacheng gas project. BP is constantly looking for material opportunities to develop our upstream business in China and will review the areas on offer," Zhao Yuanheng, a veteran spokesman of BP China, told China Daily upon seeing CNOOC's notification.

BP is an early bird in the joint development of offshore projects in China.

According to Zhao Liguo, a legal issues expert with CNOOC, there are already several foreign oil firms contacting CNOOC to request detailed documents for possible joint E&P.

"If they are interested, we will begin further bilateral negotiations for possible cooperation," Zhao said.

"If there are multiple bidders for one project, then a competition mechanism will determine which company gets the project."

The 22 blocks include three blocks in the South Yellow Sea Basin, four blocks in the East China Sea and 15 blocks in the South China Sea, according to CNOOC.

CNOOC Spokesperson Liu Junshan said that developing the 22 blocks will require fairly complicated technology and high-level expertise. "Therefore, it is necessary to bring in international experience," Liu Junshan said.

Liu Gu, a veteran analyst with Shanghai-headquartered Guotai Jun'an Securities Co, pointed out that should both global crude prices and domestic demand increase, traditionally difficult areas will need to be drilled to meet rising demand.

"As energy demand and prices increase, it becomes profitable to drill difficult areas despite the various drilling difficulties," Liu Gu said.

(China Daily 03/10/2007 page10)