HONG KONG (Standard&Poor's) Nov. 29, 2010--Standard&Poor's Ratings Services said today that its long-term corporate credit rating and outlook on China-based CNOOC Ltd. (A+/Stable/--) are not affected by the company's proposed capital injection into Bridas Corp. (Bridas, not rated). In our view, the valuation for the proposed transaction is reasonable. Standard&Poor's doesn't expect the proposed investment to have a major impact on CNOOC's credit metrics, which we view as sound. We, however, anticipate a significant increase in the company's total debts in the next 2-3 years. CNOOC has increased its effort to expand operations overseas, particularly in countries with high sovereign risks. Such a move exposes the company to uncertain legal, tax and regulatory risks.
