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CNOOC shares jump after handing out a US$7.1 billion dividend surprise as higher oil prices power earnings

  • China’s state-controlled oil explorer has proposed to pay HK$1.18 per share in a special dividend payout to A- and H-share investors
  • First-quarter earnings surged 132 per cent on higher oil and gas prices, the company said in report card on Thursday

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A security officer keeps watch outside the headquarters of China’s top offshore oil producer in Beijing. Photo: Reuters
Cheryl Heng
CNOOC shares jumped to a two-week high after China’s state-controlled offshore oil and gas explorer handed shareholders an almost HK$56 billion (US$7.1 billion) dividend windfall after a bumper earnings. JPMorgan and Credit Suisse raised their stock price targets.
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The firm proposed to pay HK$1.18 per share in special dividends to holders of its local and yuan-denominated shares, according to an exchange filing on Thursday. Earnings jumped 132 per cent in the first quarter to 34.3 billion yuan (US$5.2 billion) as crude oil prices surged, it added.

CNOOC shares advanced 3.5 per cent to HK$11.22 on Friday, adding to a 40 per cent rally this year. They soared 10 per cent to 17.01 yuan in Shanghai, a record high since its April 21 listing following a US$4.4 billion domestic stock offering.

“CNOOC’s dividend yield is now at record high, which is also relatively higher than its domestic and foreign peers, highlighting the company’s investment value,” Chen Shuxian, analyst at Cinda Securities, said in a report recommending a buy on the stock.

The Deep Sea No. 1 deep-water gas field, 150 kilometers off the city of Sanya in south China’s Hainan Province, started production in May 2021. Photo: Xinhua
The Deep Sea No. 1 deep-water gas field, 150 kilometers off the city of Sanya in south China’s Hainan Province, started production in May 2021. Photo: Xinhua

CNOOC has 44.6 billion shares outstanding in Hong Kong. It sold 2.6 billion shares to public investors in its Shanghai stock offering, a stake amounting to about 5.5 per cent of its total yuan-denominated shares.

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CNOOC said it achieved a 65 per cent gain in average oil prices last quarter from a year earlier, according to its report card. The average realised gas price was US$8.35 per thousand cubic feet, representing an increase of 24 per cent in tight market conditions.

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