Oil Deals with Shell, Chevron and Conoco Show China Is Open to Business

December 18, 2018, 9:07 AM UTC

China signaled its openness for business with a raft of deals that’ll give oil majors including Royal Dutch Shell Plc new opportunities to develop fields in partnership with the nation’s biggest offshore explorer.

China National Offshore Oil Corp. said in Beijing on Tuesday that it had inked oil and gas accords with nine firms. The signing ceremony followed President Xi Jinping’s address to party cadres marking 40 years of reform and broadly underlining the nation’s commitment to global trade.

The agreements cover 64,000 square meters in the Pearl River basin, to a depth of up to 3,000 meters. In addition to the Netherlands-based Shell, France’s Total SA and U.S.-based Chevron Corp. were also awarded parcels. All three majors hold existing production sharing contracts with CNOOC. The other firms involved are: ConocoPhillips, Equinor ASA, Husky Energy Inc., Kuwait Foreign Petroleum Exploration Co., Roc Oil Co., and SK Innovation Co.

“It’s no coincidence that CNOOC made the statement a couple of hours after President Xi’s speech,” said Tian Miao, a Beijing-based analyst at Everbright Sun Hung Kai Co. “It’s only reasonable to assume this is one of the real actions China is taking to show the world it’s willing to open businesses to the whole world.”