HONG KONG (Standard & Poor's) March 16, 2004--Standard & Poor's Ratings Services said today that its rating on China-based CNOOC Ltd.'s (foreign currency rating; BBB+/Positive/--) would not be affected by the company's announcement of a substantial increase in net profit for fiscal 2003 (ended Dec. 31, 2003) because the results are within Standard & Poor's expectations. CNOOC Ltd. reported a net profit increase of 32% to Chinese renminbi (RMB) 11.98 billion under U.S. generally accepted accounting principles, as a result of higher oil prices. However, the positive effect of higher oil prices has been partially offset by an increase in production costs. A shift by the company towards production of lower-value heavy crude oil resulted in higher production costs of
