JIANG XI ZHAO, PRESIDENT

1
THE PROGRESS OF CHINA OFFSHORE ENERGY DEVELOPMENT
JIANG XI ZHAO, PRESIDENT April 29, 2009
2
Section 1 Brief Introduction of China Offshore
OilGas Industry Section 2 Development of
China Offshore Engineering and Technology
Section 3 Capacity and Capabilities Section
4 International Competitiveness Section
5 Challenge and Opportunity Amid Financial
Crisis Section 6 Summary
3
Offshore Oil gas Facilities Up To Date
No. of Oil Gas Fields in production 50No.
of the Producing Platforms 100No. of
Onshore Terminals 7No. of FPSOs in
Operation 15
4
Offshore Oilgas Productions By CNOOC
40.46 MM Tonne
( Source from www.cnooc.com.cn )
5
CNOOC Productions Expansion Program
Production in Bohai Bay upto 30 MM Cubic Meter
Oil Equivalent by 2010
Total production upto 50 MM Cubic Meter oil
Equivalent by 2010
6
Regulatory Background

• legislation passed in 1982 ltlt REGULATIONS OF THE
  PEOPLE'S REPUBLIC OF CHINA ON THE EXPLOITATION OF
  OFFSHORE PETROLEUM RESOURCES IN COOPERATION WITH
  FOREIGN ENTERPRISESgtgt, according to which
• China National Offshore Oil Corporation (CNOOC)
  shall have exclusive and overall responsibility
  for the work of exploiting offshore petroleum
  resources in the People's Republic of China in
  cooperation with foreign enterprises
• Form of Production Sharing Contract (PSC)
  introduced

7
Past And Present Of China Offshore Construction
Sector
In the 1990s
1982 - 1990

• Increased EP Activities in South China Sea
• Water Depth Increased to 120m
• First Heavy Jacket Substructure at Over 100m
  Water Fabricated in China in 1990 cooperation
  with International Contractors Enhanced

• Originated from Bohai Bay, Offshore China
• No Qualified Chinese EPCI Contractor Existed
• International Codes and Standards Introduced
• Water Depth Less Than 40m
• Leading Roles of Overseas Contractors, even
  Qualified Welders from Overseas

2000 - Present

• Water Depth Increased to 300m
• EPIC Capability built-up for Execution of Large
  Complex Projects
• More Strict International Quality and HSE
  Performance Executed
• Over 90 Platforms built, 2500KM Pipeline laid

8
Past And Present Of China Offshore Construction
Sector
Capabilities Capacity

• Complete EPCI Capabilities Built up for projects
  at Water-depth upto 200 Meters
• Fabrication Record set for large offshore
  Structures inside China, Jacket Structure upto
  17,000mt and Topside Module upto 10,000mt
• Capacity Extended to Deeper Water project

9
Section 1 Brief Introduction of China Offshore
OilGas Industry Section 2 Development of China
Offshore Engineering and Technology Section 3
Capacity and Capabilities Section 4
International Competitiveness Section 5 Challenge
and Opportunity Amid Financial Crisis Section 6
Summary
10
Oil gas Field Development Concept
Two Concepts in Developing Offshore Oil Gas
Facilities in China

• Entirely Offshore Development - Production
  Platforms Intra-field Subsea Pipelines/Cables
  FPSO
• Part Offshore and Part Onshore Development -
  Production Platforms Subsea Pipelines/Cables
  Onshore Terminals

• SZ 36-1 Projects for CNOOC
• Production Platforms
• Central Electrical Platform
• Onshore Terminal

• QHD 32-6 Projects for CNOOC/CHEVRON
• Six Satellite Production Platforms
• One FPSO with Mooring Structure
• Intra Field Pipelines/Cables

11
Codes and Standards

• Compulsory National Fire Fighting and Safety
  Regulations
• International standardsISO?API?ASME/ANSI? AWS
  ?IEC?ASTM?DNV?ABS?BV?SOLAS. etc.
• National standardsGB?Q/HS?SYT?CCSetc.

12
Simulation PDMS/PDS
3D Model by PDMS
13
Installation
Panyu 30-1 Jacket
BZ34-1
Float-over Installation In China Topside
Weighing At 9100 MT
By Launching Weighing over 17,000 MT
14
Chinas first offshore wind mill on EPC basis for
CNOOC in Bohai Bay Clean energy development
project is bring the new prospect The more
investment should be put into facility and
technology to enhance our competitiveness
15
Tapping Deep Water

• Preliminary Conceptual Study for Deep water
  Project

• (Deep Water Lab.)

16
Section 1 Brief Introduction of China Offshore
OilGas Industry Section 2 Development of China
Offshore Engineering and Technology Section 3
Capacity and Capabilities Section 4
International Competitiveness Section 5 Challenge
and Opportunity Amid Financial Crisis Section 6
Summary
17
Offshore Fabrication Yards Distribution

• World class offshore fabrication yards
• Yards area spreads over 2,400,000 M2
• Strategically located at the coastline of China
• Total annual fabrication capability 400,000 T

• Products includes
• Jacket, Topside, FPSO Topside, Mooring Structure,
  Modularized Plant, Floating Structure, Wind Power
  Mill

TANGGU YARD
PENGLAI YARD

QINGDAO YARD

HUIZHOU YARD
SHENZHEN YARD

ZHANJIANG YARD
Total Fabrication Area 2,400,000 M2
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Qingdao Fabrication Yard

• Adjacent to Qingdao Port
• Quay Line 1,645 M
• Quay Water Depth 1012.4 M
• Total Area 1,200,000 M2
• Annual Fabrication Capacity 200,000 T
• Dock 420 M 106 M 13.9 M (Ready by Dec 09)

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Qingdao Fabrication Yard
MODULE ASSEMBLY WORKSHOP
PAINTING WORKSHOP
WAREHOUSE
DRY DOCK 420 M106 M13.9 M Ready by Dec 2009
No.1 Skidway 300m 4,000Ton

• Deep Water Production Manufacture, such as TLP,
  SPR, SEMI, DRILLING RIGS, etc.
• Facility Integration, as of FPSOs
• Offshore Construction Vessels Repair

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Tanggu Fabrication Yard
4 Skid-ways
1. 8000 T 78.14 M 2. 2000 T 115 M 3. 4000
T 150 M 4. 1800 T 138 M

• 120 KM away from Beijing
• Annual Fabrication Capacity 60,000 T
• Maximum Loading Capacity for Structure up to
  8000mt
• Total Area 200,000 M2
• Quay Line 400 M
• Quay Water Depth 8 M

21
Marine Fleet

• The Construction Fleet has the diversified
  Offshore Installation Capabilities For
  Transportation, Lifting, Pipeline/Cable Laying,
  Diving Support, Etc.

22
LAN JING
LAN JIANG
7,500T Self-propelled Crane VESSLE LAN JING
3,800T Full Revolving Derrick Lay BARGE LAN
JIANG

• Dimensions 2395020.4 M
• Main Hook Fixed 7,500T 45 M
• Main Hook Full Revolving 4,000 T 40 M
• Draft 8.9 M
• Water Depth 10 300 M
• Speed 11 KN
• Accommodation 300 Persons

• Dimensions 157.54812.5 M
• Max. Lifting 3,800 T
• Pipe Dia. 4.5 48
• Tension of Pipe Tensioner 73 T
• Draft 8 M
• Water Depth 8150 M
• Accommodation 278 Persons

23
HYSY
HYSY
2
2
0
2
1
9
4,000T Deepwater Pipe Lay Crane VESSEL HYSY 201
30,000T Launch BARGE HYSY 229

• Dimensions 20439.214M
• Draft 7 10.8M
• Water Depth 15 3,000M
• Main Derrick Hook 4,000 T 43M
• Pipe Dia. 6 60
• Pipe-laying Mode S/J
• Dynamic Position DP-III
• Speed 12KN
• Planned Service Date Aug. 2010

• Dimensions 234.752.514.25M
• Draft 6.5 10.42M
• Max. Cargo Load 89,000T
• Max. Launching Jacket Weight 30,000T
• Deck Load 15T/M2
• Line Load on Deck Transverse 230T/M

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EPCI One-Stop Solutions Provider
Bohai Bay Phase II Project

EPCI-SES Project , Java sea
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Fabrication
Petrobras Opportunity Oil FPSO, 10 Moduels total
at 7,000 mt
BZ 34-1 Project
4 unit jackup rigs for COSL
Modularized Mining Plants for X-Strata, 17
modules total at 40,000 mt
26
Offshore Installation
VED Project ONGC, Indian Sea
BHPB Pyrenees FPSO Project
Anadarko CFD EPCI Project, Bohai Bay
CACT HZ EPCI Project South China Sea
27
Subsea Service Renovation
With ROVs, underwater inspection equipment and
repair system, and dedicated diving spread with
international qualification, subsea is becoming
core strength with more investment being planned
WZ Subsea Pipeline Repair Project

• DSVs
• Saturated Diving
• ROVs

Liu Hua 1-1 Oil Field Recovery Project, 300M
28
R D Capabilities
Welding Laboratory at National level
1
Physicochemical Laboratory
2
Technology RD Center
3
Welder Training and Certification Center
4
Post-Doctoral Research Center
5
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HSE Performance With International Standards
This performance has been awarded as Best
Contractor for 5 MM Manhours in 680 Consecutive
days without Lost Time Incident
by CNOOC-ConocPhllips Penglai 19-3 Project.
Note LTIR (Lost Time Incident Rate) (fatality
Accident No.Lost-time accidents No.restricted
workdays cases No.)200,000/Total man-hours
worked

• The HSE Quality are always the weakness in our
  management, which need continual improvement.

30
Section 1 Brief Introduction of China Offshore
OilGas Industry Section 2 Development of China
Offshore Engineering and Technology Section 3
Capacity and Capabilities Section 4
International Competitiveness Section 5 Challenge
and Opportunity Amid Financial Crisis Section 6
Summary
31
International Competitiveness
Basic Characteristics of Industry Leaders

• Key for International Competitiveness
• International Level Capability and Capacity
• Qualified Human Resources
• Understanding of International Rules and
  Practices
• Strong Project Management and Control
• World Class HSE Performance
• Certified ISO QA system Strong Quality Control
  
• Cost Leading Strategy

32
Section 1 Brief Introduction of China Offshore
OilGas Industry Section 2 Development of
China Offshore Engineering and Technology
Section 3 Capacity and Capabilities Section
4 International Competitiveness Section
5 Challenge and Opportunity Amid Financial
Crisis Section 6 Summary
33
Challenges Opportunities
Challenges
Opportunities

• Shrinking Market due to financial crisis
• Constraint of deep water and LNG Technology
• Technical innovation
• High added value product equipment developing

• Accelerated shift of offshore construction
  project to china yard from overseas yard clients
  are more cost conscious
• Sound Economy Conditions in china amid financial
  crisis worldwide
• Demand of OilGas still Strong in China
• The government issued Ship Industry
  RegulatingReviving Plan

34
Cooperation
With the long-term developing of shallow water,
the deep water is becoming a focus area, which is
invested by more and more countries. The area
covers West Africa, Mexico, South China Sea etc..
So besides focusing more on developing our
capacities and core competitiveness, a long-term
cooperative relationship between offshore
industry and shipping building industry should be
established to achieve the domestic and
international market together in terms of
deepwater technology development listed below

• FPSO
• TLP
• SPR
• Construction Vessels
• SEMI
• Pipe Laying
• Drilling Rigs

• Transportation Facilities
• LNG/LPG Facilities
• FLNG Facilities
• Disaster Oceanography Research and EIA
• Offshore Wind, Tide, Wave Energy Development
• etc.

35
Section 1 Brief Introduction of China Offshore
OilGas Industry Section 2 Development of
China Offshore Engineering and Technology
Section 3 Capacity and Capabilities of
COOEC Section 4 International
Competitiveness Section 5 Challenge and
Opportunity Amid Financial Crisis Section 6
Summary
36
Summary

• The construction of offshore oilgas facility is
  adapt to international codesstandards
• The domestic energy service companies grow up
• China plays more and more active role in offshore
  industry and ship building industry
• Expenditure in deep water greatly increased
• A lot of corporation opportunities with
  international service company
• Under the current global financial crunch, all of
  us across the offshore marine industry are
  faced with great challenges , however, we are
  confident that we should have more cooperation
  opportunity to work together to face the crisis
  and the future development.

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THE END Thank You !