Dominant market position in the Chinese offshore market. Increasingly diversified reserve base. Satisfactory reserve life and good record of production growth. Exposure to volatility in oil and gas prices. Strong cash flows. Adequate liquidity. Scaled-back yet still significant capital expenditure. The negative rating outlook on CNOOC Ltd. reflects the outlook on the sovereign credit rating on the People's Republic of China (AA-/Negative/A-1+; cnAAA/cnA-1+). We could lower the rating on CNOOC Ltd. if we downgrade the sovereign rating. Other triggers include if the central government reduces its support to the company because of a change in the government's strategies or priorities, or CNOOC Ltd.'s stand-along credit profile falls from 'a-' to 'b+' or below, both scenarios we view as unlikely. We
