Sales decline to 18.26b yuan in the third quarter CNOOC, the mainland's dominant offshore oil and gas producer, posted a 1.8 per cent year-on-year decline in third-quarter revenue as the appreciating yuan offset higher oil and gas sales and realised prices. Total revenue was 18.26 billion yuan, compared with 18.59 billion yuan for the same period last year, the company said in a statement. In US dollar terms, oil and gas revenue grew 3.86 per cent to US$2.39 billion. CNOOC did not disclose quarterly profit figures. Crude oil output edged up 0.3 per cent year on year to 373,287 barrels per day, while natural gas production jumped 17.9 per cent to 595 million cubic feet per day. Together, oil and gas output grew 3.8 per cent to 476,937 barrels per day. The average crude selling price for oil rose 9.04 per cent to US$67.37 a barrel in the quarter, while the realised price for gas climbed 0.88 per cent to US$3.42 per thousand cubic feet. Chief financial officer Yang Hua attributed the fall in revenue despite higher output and prices to the yuan's gains on the dollar. Although production at the Liuhua oilfield in the South China Sea resumed earlier than expected in late June after being damaged by a typhoon, and few powerful typhoons hit the area this year, Mr Yang said CNOOC had maintained its output target of 162 million barrels of oil equivalent (boe) to 170 million boe that it set in January. The field accounted for about 4.8 per cent of total output. 'Nobody can guarantee that no typhoon will visit our facilities in November,' he said in a teleconference. Another factor in the conservative target is the recent surge in oil prices that would cut the effective output attributable to CNOOC in some of its Indonesian oil projects. CNOOC can book guaranteed income from the projects, but its output entitlement is inversely related to oil prices. However, Mr Yang said the projects' output was relatively small compared with the company's total. Meanwhile, China Petroleum & Chemical Corp (Sinopec) chief financial officer Dai Houliang said the company achieved an oil refining margin of 194 yuan per tonne (about US$3.50 per barrel) in the first nine months of this year, down from 260 yuan a tonne in the first half. Crude costs at its refining operation rose from US$56 a barrel in the first quarter to US$62 in the second and US$68 in the third. Analysts put break-even at a US$65 crude price. 'The rise in international oil prices has increased the [cost] pressure on our refining operation,' Mr Dai said. 'The impact is relatively big.' The firm is free to set prices on sales of about 33 per cent of its refined products, primarily naphtha, a feedstock for making petrochemicals. It must follow state-guided prices on the remainder, mainly petrol and diesel, prices of which have been kept artificially low to protect the farming and public transport sectors. However, Sinopec benefited from the yuan's appreciation, which lowered crude import costs. It imports about 70 per cent of its needs. Analysts polled by Thomson Financial expect CNOOC to post a 5.3 per cent decline in net profit to 29.28 billion yuan this year, and for Sinopec, a 17.5 per cent increase to 53.91 billion yuan. Sinopec on Monday posted a 43.21 per cent year-on-year net profit growth to 49.81 billion yuan for the first nine months.