Cnooc has agreed to acquire 24.5% participation interests in Block 15/34 from Devon Energy for a consideration of $515m.

Block 15/34 is located in the Pearl River Mouth Basin of South China Sea. It is approximately 200km south of Hong Kong, with a water depth of 100mt. Panyu 4-2/5-1 is the major producing oil field in Block 15/34 and started production in 2003. Currently gross production from the block is 49,000 barrels of oil per day.

Completion of the transaction is subject to necessary government and regulatory approvals of China. Cnooc, the operator, will increase its stake to 75.5% in the Block 15/34 after Devon’s transfer. The other partner ConocoPhillips holds the remaining 24.5% interests.

Yang Hua, president of Cnooc, said: “This is a mutually beneficial deal for Cnooc and Devon. I believe the transaction will help further strengthen our solid position in offshore China and create more value for our shareholders.”