High Prices Drive Chinese NOC Transitions

Copyright © 2023 Energy Intelligence Group All rights reserved. Unauthorized access or electronic forwarding, even for internal use, is prohibited.

Surging upstream profits are giving Chinese national oil companies (NOCs) an opportunity to boost transition spending and flesh out decarbonization goals. But China’s energy security remains their primary mission and in the near term this means continued growth in domestic fossil fuel production. China’s plans to peak carbon emissions by 2025 and become carbon neutral by 2060 pushed its NOCs to come up with transition goals. But a flurry of initial pledges lacked detailed plans. With crude prices averaging $108 per barrel this year, their highest since 2013, China’s NOCs have the cash they need to progress their green plans. “With high oil prices, companies can do it all — fund their E&P, pay dividends, service debt and still have spare financial capacity to develop energy transition projects,” Wood Mackenzie’s corporate research director Kavita Jadhav told Energy Intelligence. Upstream-focused China National Offshore Oil Corp. (CNOOC) Ltd. expects first-half 2022 profits to more than double from last year to as much as 71.5 billion yuan ($10.6 billion). Parent company CNOOC has pledge to boost clean energy investments to 10%-15% of total capital expenditure from the 2026-30 period, up from the current 5%-10%. The plan would make the company a leader among NOCs in terms of green energy spending and exceed the transition spending guidance of Exxon Mobil and Chevron as a percentage of capex.

Corporate Strategy , Carbon Capture (CCS), Hydrogen, Gas Supply
Wanda Ad #2 (article footer)
Mounting risks threaten a predicted loosening of LNG markets by 2026, as the industry copes with cost inflation, labor shortages, construction delays and other challenges.
Thu, Sep 28, 2023
The three hubs are being developed in parallel with storage facilities with an initial combined storage capacity of 15 million tons/yr of CO2.
Mon, Oct 2, 2023
With the COP28 climate conference just weeks away, industry executives have largely fallen silent on the topic of emissions caused by burning fossil fuels.
Mon, Oct 2, 2023