ConocoPhillips (COP:US) received approval to resume production at the Penglai 19-3 oilfield off the northeast coast of China, which was closed in 2011 after an oil leak.
A development plan and environmental assessment report for the oilfield have been approved, China’s State Oceanic Administration said in a statement on its website. The regulator will keep monitoring the area while Houston-based ConocoPhillips restarts operation, it said.
The administration ordered operations at the Penglai field to shut down in September 2011 after at least 3,200 barrels of oil and fluids leaded into Bohai Bay. ConocoPhillips and its Chinese partner Cnooc Ltd. have cleaned up the spill and agreed to pay about $160 million in compensation to fishermen.
“Cnooc should urge and assist ConocoPhillips to strictly comply with the newly approved development plan, the environmental assessment reports and the oil and gas production codes,” the administration said in the statement.
The National Development and Reform Commission, China’s economic-planning agency, approved the development plan for Penglai 19-3 in December, the National Energy Administration said on Jan. 11.
Cnooc, China’s biggest offshore oil and gas producer, rose 0.5 percent to HK$15.96 in Hong Kong trading yesterday, while the benchmark Hang Seng Index climbed 0.1 percent. ConocoPhillips (COP:US) declined 1.6 percent to $57.02 in New York.
Penglai 19-3, Cnooc’s largest offshore oilfield, produced 62,000 barrels of oil a day before it was shut. The lost production was equivalent to about 7 percent of the company’s targeted daily oil and gas production, according to calculations made by Bloomberg.
Cnooc has received final approval from the U.S. for a $15.1 billion acquisition of Calgary-based Nexen Inc., the biggest overseas takeover by a Chinese company, Nexen said on Feb. 12.
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