In June 2011, oil spills from an oilfield jointly owned by Houston-based ConocoPhillips’ Chinese subsidiary and CNOOC, China’s main offshore oil and gas producer, drained into the Bohai Sea and its bay.
While China has sought to replicate the U.S. shale boom, the nation last year cut its 2020 shale gas production target to about a third of its original estimate amid difficult geology, lack of infrastructure and limited exploration rights.
Houston-based ConocoPhillips has already trimmed its 2015-2017 capital spending program from an initial $16 billion to about $11.5 billion per year after crude oil prices fell last fall. Of that $11.5 billion, less than $1.8 billion was dedicated to exploration.
The proposed requirements would unnecessarily shorten an already brief window for exploratory drilling in the Chukchi and Beaufort seas while dramatically boosting the costs of those operations, dissuading companies from drilling in the region, industry representatives said in formal comments filed with the government.
ConocoPhillips paid about $506 million for 98 exploration leases about 100 miles off Alaska’s north coast in 2008. In April of 2013, the company suspended its plans to drill an exploratory well in the sea, citing uncertainty in regulations.
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