China's top offshore oil producer CNOOC Ltd said it will take a conservative approach to acquisitions as it reported its lowest half-year earnings since 2005 on weak crude oil prices.

CNOOC, which has traditionally been the most active of the big three listed Chinese oil companies in foreign deal-making, said it was instead pursuing a strategy of cooperating with other companies.

The global financial crisis is not over, CNOOC Chairman Fu Chengyu said at a media briefing on Wednesday. The economic recovery in the U.S. and Europe still needs to take some time. Under this macro environment, we will not do large-scale acquisitions.

CNOOC, which raked in record profits last year, said its first-half net income dropped 55 percent from the year before to 12.4 billion yuan ($1.8 billion). Analysts' had estimated first-half net income of 11.4 billion, according to a poll by Reuters.

Revenue fell 42 percent to 40.65 billion yuan.

CNOOC had no interest in bidding for a stake in Spanish oil major Repsol's YPF unit, along with CNPC, the state-run parent of PetroChina, Fu said.

There is no such (plan). All that has been written so far is just market noise, Fu said, referring to reports of a joint bid with CNPC.

Asked whether CNOOC is interested in forming a joint venture with Repsol, Fu said: We are willing to do a joint venture with any company in the world.


An earlier Reuters report had said CNOOC had approached Repsol about forming an international oil and gas production venture, citing sources familiar with the matter.

But Fu confirmed CNOOC is bidding for Kosmos Energy's stakes in the jubilee oil field offshore Ghana.

We are participating in the bid, Fu told Reuters after a news briefing.

CNOOC's cautious approach contrasts with rival Sinopec, which made headlines when its state-run parent bought Swiss oil explorer Addax Petroleum Corp for $7.24 billion in China's largest-ever overseas acquisition.

Fu said a secondary listing in the mainland market would depend on government approval.

Before the results, CNOOC shares ended down 0.2 percent at HK$10.70. Shares in CNOOC rose 32.7 percent in the first half, outperforming the benchmark Hang Seng Index .HSI, which gained 27.7 percent.

Sinopec previously posted record quarterly profits on higher fuel prices and falling crude oil prices, underscoring the turnaround in fortunes for China's once-struggling refiners. [ID:nHKG107709].

PetroChina reports its earnings on Friday.

(Editing by David Holmes)

($1=6.831 Yuan)