CNOOC and CNNC Suddenly Join Hands: Unveiling the Reasons for the Cross - sectoral Cooperation between the Oil and Nuclear Power Central State - owned Enterprises
CNOOC and CNNC are collaborating to use nuclear energy to solve the power supply problem in the deep and far - reaching seas.
According to Yujian Energy, on April 15th, Zhang Chuanjiang, the chairman of CNOOC, and Shen Yanfeng, the chairman of CNNC, signed a strategic cooperation agreement in Beijing. The two parties agreed to conduct in - depth collaboration in three major fields: new energy development, nuclear power project cooperation, and technological innovation.
It is not common in the industry for an oil and gas state - owned enterprise to actively cooperate with a nuclear energy state - owned enterprise on nuclear power projects. Yujian Energy believes that behind this is the real power supply dilemma that CNOOC faces in the deep and far - reaching seas, and it also reflects a technological threshold that traditional oil companies have to face during the transformation process.
Most of the easily accessible oil has been extracted, and CNOOC lacks solutions
CNOOC's net production in 2025 is approximately 777 million barrels of oil equivalent, and the target for 2026 is 780 million to 800 million barrels. Where will the incremental production come from? Yujian Energy predicts that deep - water projects will be the main contributors.
The total oil and gas production of the "Deep Sea No. 1" gas field in the South China Sea will exceed 4.5 million tons of oil equivalent in 2025. The operating water depth is over 1,500 meters, and the distance from the shore is about 150 kilometers. In this environment, the biggest challenge is not drilling but 24 - hour uninterrupted power supply.
The solution for the Bohai Oilfield is to lay cables from the land, that is, the shore - power project. As of the end of May 2025, the cumulative power supply of the shore - power project has exceeded 5 billion kilowatt - hours, and a shore - power grid covering 7 oilfield clusters has been established in the Bohai Sea. However, the cost of this model increases with the distance from the shore. The cost of cables rises rapidly with distance, and the difficulty of fault repair also increases. For deep - sea platforms with a water depth of over one thousand meters and a distance of over one hundred kilometers from the shore, the option of laying cables from the land is becoming increasingly limited.
What about offshore wind power? CNOOC is vigorously deploying it. The total installed capacity of the Hainan CZ7 project is 1,500 megawatts, and that of the four projects in Shanwei Honghai Bay is 500 megawatts. However, wind power generation depends on weather conditions. The power output fluctuates with the change of wind speed and cannot provide a stable base load. In addition, in the high - salt and high - humidity environment of the deep sea, the energy storage system is severely corroded, and the operation and maintenance costs remain high. Once there is no wind for a continuous period, the energy storage system cannot support the power demand.
What CNOOC faces is not a lack of projects but a lack of a stable, reliable, and externally - independent power supply solution.
Nuclear energy becomes one of the few options, and Linglong One is CNNC's ace
Nuclear energy is almost the only option that can meet the four requirements of stability, continuity, low - carbon, and compactness at the same time.
CNNC has a card called Linglong One, with the official model number ACP100. It is a small modular reactor independently developed by CNNC with an electric power of 125,000 kilowatts. The demonstration project started construction in Changjiang, Hainan in July 2021. The installation progress has reached 90%, and it is currently in the core equipment commissioning stage. It is expected to be connected to the grid for power generation in 2026.
The safety system of Linglong One adopts a fully passive cooling design. In the event of an accident, it can achieve long - term safe cooling without an external power supply. The refueling cycle is 24 months, and the platform can operate independently for a long time without frequent reliance on logistics supplies from the far - reaching sea. The modular design also shortens the construction period. The first reactor took 58 months, but in the future, the construction period for mass - produced reactors can be controlled within 36 months.
Of course, Linglong One is currently a land - based demonstration, and additional engineering verification is required for its adaptation to offshore floating platforms. But this is exactly the significance of this cooperation: CNNC needs to verify the offshore adaptability of the small reactor in the marine scenario, and CNOOC needs a stable power supply to solve the power supply problem in the deep and far - reaching seas.
Yujian Energy believes that this is not just a simple signing but a technological coupling that meets each other's urgent needs.
This game is not only about the sea, but also about standards and influence
Carbon emissions are changing the competition rules of the international crude oil market. The carbon intensity in the extraction process of a barrel of crude oil may directly affect its pricing ability in the future. International buyers are becoming more and more strict about the carbon footprint of the supply chain. Crude oil with high carbon emissions will have reduced competitiveness in the international market.
By introducing nuclear energy, CNOOC is essentially obtaining a low - carbon certification for its crude oil products. Yujian Energy believes that this is not only about solving engineering problems but also about adapting to the future changes in international competition rules in advance.
For CNNC, the significance of this cooperation may be even greater. The competition in global small modular reactors is heating up.
The floating offshore nuclear power platform developed by South Korea's Samsung Heavy Industries has received the principle approval from the American Bureau of Shipping and is equipped with two SMART100 small reactors. There are already dozens of SMR projects in the development stage globally. Whoever can complete the offshore commercial operation first will have the opportunity to establish industry standards.
Although Linglong One is currently a land - based demonstration, CNNC's goal is the overseas market. Currently, nearly 10 countries have signed letters of intent for cooperation on small reactors, and Thailand has sent trainees to participate in paid training. Successful verification in the offshore scenario will become the most convincing overseas business card for China's small - reactor technology.
Looking deeper, the energy supply in the deep and far - reaching seas is a problem that the entire industry has not systematically solved. Offshore wind power in the near - sea area is relatively mature, but there is no mature solution globally on how to supply power and achieve multi - energy synergy in the deep and far - reaching seas more than 100 kilometers from the shore. The combination of CNNC and CNOOC is trying to build a self - sufficient energy system in the deep and far - reaching seas using a model of nuclear energy base load plus wind power increment and surplus wind power for hydrogen production. If successful, it will output a complete solution and industry standards.
What the outside world sees in this signing is the handshake between two state - owned enterprises. Behind the handshake, an oil company has to find a power supply solution that is more stable than shore - power, more reliable than wind power, and more low - carbon than diesel in order to continue oil extraction in deeper waters. Nuclear energy happens to meet these requirements. For CNNC, this is a commercial verification of promoting land - based small reactors to the ocean. For CNOOC, this is an expensive but necessary investment: to go deeper into the sea, the power problem must be solved first.
This article is from the WeChat official account "Yujian Energy", author: Wang Mengjiao. Republished by 36Kr with permission.