CNOOC's third quarter revenue jumped 25 per cent year on year, thanks to higher oil and gas prices and a robust production growth.

China's top offshore oil and gas producer generated 18.6 billion yuan (US$2.35 billion) in revenue, a year-on-year increase of 25 per cent, and its proceeds from oil and gas rose to 18.4 billion yuan (US$2.32 billion), up 24.5 per cent.

Its total revenue leapt 37 per cent to 54.35 billion yuan (US$6.87 billion), driven largely by its revenue from oil and gas that jumped 36 per cent to 53.85 billion yuan (US$6.81 billion).

CNOOC Chairman Fu Chengyu was pleased with the results. The company has had an "outstanding performance in the third quarter", he said yesterday.

"Higher oil and gas prices and a robust production growth helped our company achieve satisfactory results in the third quarter," Fu said.

State-owned CNOOC saw its average oil and gas prices rise by 17.9 per cent and 15.3 per cent to US$61.78 a barrel and US$3.39 per thousand cubic feet. It pumped 459,460 barrels of oil equivalent (BOE) a day in the third quarter, up 7.5 per cent from last year.

Its offshore production volume alone grew by 7.7 per cent to 417,884 BOE, thanks to a further increase in production in western and eastern South China Sea.

"We expect CNOOC's total production volume to reach 169.3 million BOE by the end of 2006," South China Research associate director Andes Cheng said.

CNOOC is looking at a total production volume of 168-171 million BOE in 2006 but that has been made somewhat difficult by the recent typhoon that forced some of its oil fields to stop production.

"We are under pressure... our oilfields such as Liuhua are reporting a loss of 22,000 barrels a day after ceasing production," CNOOC Chief Financial Officer Yang Hua said. "The major factor to influence our production now is weather."

Yang, however, is confident that the company will meet its production target, which he said would boost its total production volume by about 9 per cent from 2005.

Cheng said: "If oil prices do not fall significantly in the fourth quarter, CNOOC's momentum to grow should continue... We expect the company's revenue in 2006 to grow by about 26.5 per cent year on year."

United Securities (Shenzhen) analyst Xiao Hui felt that the company's overall performance this year should be "good", with more oilfields being put on the production line. "With oil prices expected to stabilize between US$60 to US$70, it should maintain a earnings growth."

CNOOC discovered two more offshore oil and gas fields, Liwan 3-1 and Weizhou 6-12S and its exploration capital expenditure in the third quarter increased by 35.9 per cent to 833 million yuan (US$105 million). Three of its new oil projects - QK17-2E, CFD oil fields and Weizhou 6-1 began production from October, churning out about 19,900 barrels of crude oil per day.

But despite CNOOC's the third quarter gains, its shares fell slightly, by 0.15 per cent, to HK$6.54 yesterday.