Bohai Leak Forces Cnooc To Cut Estimates

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Cnooc, China's largest offshore oil explorer, saw its shares plunge in Hong Kong trading after the company was forced to again reduce its annual output estimate due to leaks at China's Penglai 19-3 field in Bohai Bay that have forced the company to shutter operations at the country's largest oil field.

When a pair of oil leaks started in June, Cnooc (CEO) originally pared its annual output estimate by 22,000 barrels per day. The company has now added another 40,000 barrels per day of lost production to that estimate. ConocoPhillips (COP), the third-largest U.S. oil company, is Cnooc's partner on the project.

Conoco is facing issues of its own related to the Bohai Bay leaks. The U.S. oil giant was ordered by Chinese regulators on Sept. 2 to halt output at the field. Conoco pumped an average of 56,000 barrels per day at Bohai Bay last year and that figure accounted for about 3% of the company's global daily output, Bloomberg News reported.

The 62,000 barrel-a-day cut in Cnooc's output is equivalent to 6.9% of the company's average global oil and gas production of 901,369 barrels a day last year, Bloomberg reported. The leaks have caused about 3,200 barrels of crude to spill since June.