China National Offshore Oil Company Limited (CNOOC Ltd.) announced Tuesday that the first appraisal well at its deep-water natural gas discovery in South China Sea has been successfully completed by its partner Husky Oil China Limited.

Test results of the appraisal well, Liwan 3-1-2, showed flow at equipment restricted rate of up to 53 million cubic feet of gas per day, providing further evidence of the discovery, Liwan 3-1, as a major gas discovery deep water offshore China.

Future deliverability is expected to reach over 150 million cubic feet per day, said CNOOC Ltd.

China National Offshore Oil Corporation (CNOOC), the parent company of CNOOC Ltd., entered into a production sharing contract with Husky for deepwater block 29/26 in the Pearl River Mouth Basin in August 2004. The Liwan 3-1 discovery was made in the block in 2006.

Husky Oil China Limited is the subsidiary of Husky, listed in Canada.

The appraisal well Liwan 3-1-2 is about 350 kilometers southeast of Hong Kong. The drilling activities commenced in November 2008. The total vertical depth of the well is 3,887 meters，with water depth of about 1,345 meters.

Drilled on a large structure with 55 square kilometers of mapped closure, the well encountered 36 meters of net gas pay over the main reservoir zone.

To clarify the extent of the discovery and determine the flow capacity of the reservoir, further evaluation will be conducted in the near future, said CNOOC Ltd.

CNOOC Ltd. has the right to participate in up to 51 percent working interest during the development period. Husky acts as the operator in the block.

Listed in Hong Kong and New York, CNOOC Ltd. is the subsidiary of CNOOC, China's largest offshore oil and gas producer.

(Xinhua News Agency February 24, 2009)