Xiaomo: The target price of CNOOC (00883) was raised to HK$31.5. Production in the fourth quarter is expected to pick up with Lingshui's 17-2 resumption of production

The Zhitong Finance App learned that J.P. Morgan Chase released a research report saying that the third-quarter results of CNOOC (00883) were generally in line with expectations after excluding one-off projects. Production in the fourth quarter is expected to pick up with Lingshui 17-2 production and maintain an “increase in holdings” rating. The target price rose from HK$30 to HK$31.5.

CNOOC's net profit for the third quarter was 33 billion yuan, up 2% year on year and down 29% from quarter to quarter. It was lower than the bank's forecast of about 40 billion yuan, mainly due to impairment of 7.2 billion yuan in overseas assets; after excluding one-time projects, profit was generally in line with expectations.

The management confirmed at the performance meeting that the Lingshui 17-2 gas field floating production storage and offloading unit (FPSO) continued to operate as planned in the fourth quarter after being shut down due to a fire in May, and indicated that the impact of related disruptions was limited, and reiterated the 2026 full-year production guideline of 780 to 800 million barrels of oil equivalent. The bank continues to prefer CNPC, but it maintains an “gain” rating for both companies based on strong oil prices.

After the results, the bank lowered CNOOC's 2026 net profit forecast by 5% to reflect asset depreciation, but increased the 2027 net profit forecast by 2% due to the high average sales price of domestic natural gas.