Tuesday, CNOOC Ltd. (CEO), a unit of China National Offshore Oil Corp., reported a 42% rise in profit for fiscal 2008, boosted mainly by stable net production growth and higher realized oil and gas prices. Further, the Hong Kong-based oil and gas firm provided its production growth target until 2015, and also said its Board proposed a final dividend.

Net profit for fiscal 2008 soared to RMB 44.38 billion from RMB 31.26 billion a year ago. On a per share basis, earnings for the year were 0.99 RMB Yuan, up 37.5% from 0.72 RMB Yuan last year. The company noted that the strong profit maintained the growth momentum for eight years since its listing.

Oil & gas sales in the year climbed 38.1% to RMB 100.83 billion from RMB 73.04 billion last year. Meanwhile, net marketing revenue fell to RMB 292 million from RMB 315 million a year ago.

Among peers, China-based oil and gas producer PetroChina Co. Ltd. (PTR) last week reported a double-digit decline in fiscal 2008 net profit to RMB 126.65 billion from RMB 155.17 billion in the prior year, hurt by higher costs and volatility in crude oil prices. Based on IFRS, full-year net profit attributable to equity holders of the company was RMB 114.43 billion, down 22% from last year and earnings per share dropped 23.2% to RMB 0.63, however, turnover increased 28.1% year-over-year to RMB 1.07 trillion.

Commenting on the results, Yang Hua, President and Chief Financial Officer of CNOOC said, Although the Company faced financial crisis and oil price plunge in 2008, we still achieved remarkable results. I am proud of our outstanding operating and management capabilities which have once again been proved by the strong production growth, competitive cost structure and record net profit.

During the period, net production reached 195.4 million barrels of oil equivalent, or mmboe, representing a strong growth of 14% over 2007, driven by the contribution of new fields and strong performance of the producing fields.

Production was 533,871 boe per day, up 13.7% from 469,407 boe per day in 2007. Excluding the company's interests in an unconsolidated investee, net production per day was 530,728 boe, 14% higher than last year.

The average realized oil prices increased 34.9% year-on-year to reach US$89.39 per barrel, and gas prices rose 16.3% to US$3.83 per thousand cubic feet.

CNOOC said it spent US$938 million on exploration in 2008, up 40.8% from last year, while its development Capex and production Capex reached US$3.49 billion and US$687 million, respectively.

Further, the company said its board has proposed a year-end dividend of HK$0.20 per share, resulting in a total annual dividend to shareholders in 2008 of HK$0.40 per share. The final dividend will be paid on June 11, with record date of May 27, the company noted.

Fu Chengyu, Chairman and Chief Executive Officer noted, The Company's decision to reward our shareholders by cash reflects not only our commitment to shareholder return, but the management's confidence in our operations and the Company's prospect as well.

Looking ahead, CNOOC said it continues to add reserves through exploration and acquisitions, and that 10 development projects are scheduled to come on stream in 2009.

For the year 2009, the company's production target is 225 to 231 mmboe. Till 2010, the company expects production growth of 7% to 11%, while from 2011 to 2015, the company's expected growth is 6% to 10%.

CEO closed Monday's regular trading session at $99.29, down $6.08 or 5.77%, on a volume of 583 thousand shares.

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