Newfield builds up China assets

US independent Newfield Exploration has added to its offshore exploration portfolio in China by signing up for two new shallow-water blocks.

Block 22/15 in the Beibu Gulf basin of the western South China Sea covers a total area of 5228 square kilometres with water depths of between 10 and 60 metres.

The contract has an exploration term of seven years, with a drilling commitment in the first three years.

Block 16/05, located in the Pearl River Mouth basin, covers a total area of 2064 square kilometres.

Newfield previously had a geophysical survey agreement (GSA) on Block 16/05, and said a recent 3D seismic survey had given encouraging results.

Newfield plans to drill exploration wells in the first half of 2008 on Block 16/05 and its exisitng Block 17/08.

All exploration costs are borne by Newfield. China's CNOOC Ltd has a back-in right to 51% of any commercial development.