In a statement KMC senior vice president David Hager said, “Kerr-McGee’s operation in the 04/36 block of China’s Bohai Bay was expected to initially produce 15,000-20,000 barrels of crude oil per day. [It will] increase to 40,000-45,000 barrels per day in 2005.”

“We see this really as the first part of a hub-and-spoke strategy for the area, and this will lay the groundwork for tying back additional discoveries into the existing infrastructure. It will [also] give us the opportunity to develop smaller oil fields in the same area,” added Hager.

KMC has a 41% stake in the Block. CNOOC Ltd holds a 51% share and the balance is held by Ultra Petroleum.