CNOOC has maintained its domestic offshore focus drilling an average of more than 100 E&A wells per year in China. This activity has delivered 4.0 billion boe of net reserves from a total of 4.7 billion boe conventional resources discovered. During 2014 deepwater exploration in the South China Sea was an important focus but activity has prioritised more established lower cost provinces since 2015. CNOOC has responded to the weaker oil price with overall capital investment reductions of at least 10% in 2016. This partly reflects the conclusion of heavy domestic investment but is also a result of increased focus on value and shareholder returns. CNOOC still lags a long way behind the largest IOCs in terms of deepwater exposure. If the company is to build a self sustaining international business it will need to replace production though the exploration drill bit. As such the drivers to continue to expand into high impact deepwater exploration opportunities remain strong.