XIAMEN FIT IMPORT & EXPORT CO., LTD.

COSL to plan A-share listing
click rate:2518 issue time:2007-03-10 08:12

Jan. 29, 2007 (China Knowledge) – China Oilfield Services (COSL) <2883>, the largest provider of equipment and services to Chinese oil companies, plans to raise as much as RMB 1.6 billion from a Mainland listing.

The A-share offering is part of an almost RMB 6 billion fund-raising program spanning two years. A source told the South China Morning Post Monday that the IPO would begin after the completion of a domestic bond sale of up to RMB 2 billion.

A China Oilfield spokesman said the company had no specific plans for an A-share listing.

CEO Yuan Guanyu recently said the company was studying the possibility of selling A-shares. He indicated at that time that an H-share placement was also possible. The company also said it planned to sell a further RMB 2 billion in bonds next year as well.

Rising demand for oil has caused an increase in capital expenditure. COSL, a unit of CNOOC Group <883><CEO>, said last week that capital expenditure this year is likely to exceed last year’s record high of RMB 2.8 billion in a bid to take advantage of increased drilling demand.

In 2006, the company’s capital spending reached a record RMB 2.8 billion with a new jack-up oil rig and two chemical carriers while spending was up 27.3% compared with RMB 2.2 billion in 2005.

The increase in capital spending is in line with the COSL’s production rates. Last year, the number of operating days for drilling activity in the company's wells rose 3.6% to 4,769 days, while the utilization rate of drilling activities was 100%, up 2.1% compared with 2005.

In the first half of 2006, COSL recorded a net profit of RMB 670.3 million, a 20.6% increase compared with RMB 555.9 million a year ago, boosted by robust exploration and development activities in Mainland offshore fields.