Oct. 29 (Bloomberg) -- Cnooc Ltd., China’s biggest offshore oil and gas producer, said third-quarter sales dropped 23 percent after crude prices fell from a record and a typhoon forced the company to cut output at some fields.

Revenue declined to 23.76 billion yuan ($3.47 billion) as the realized oil price dropped 37 percent in the period ended Sept. 30, the Beijing-based company said in a statement to the Hong Kong stock exchange today. China’s third-biggest oil company didn’t issue a quarterly profit figure as the company only reports half- and full-year earnings.

Crude averaged 42 percent lower in the third quarter from a year earlier, when it reached a record $147.27 a barrel in New York on July 11. Cnooc, which gets more than 70 percent of its production from offshore fields in the country, is boosting output to benefit from a rebound in prices as China’s economy leads the world out of recession.

“The production figures will just about reach the company’s targets this year,” Grace Liu, an analyst at Guotai Junan Securities, said by telephone from Shenzhen. “Any difficulties it may have will be more than offset by the rise in crude prices.” Liu has a buy rating on Cnooc stock.

Cnooc is confident of meeting its production target of 225 million to 231 million barrels of oil equivalent even though it lost some production after Typhoon Koppu slammed into fields in Huizhou in southern China in September, Chairman Fu Chengyu said in the statement.

Goldman Sachs Group Inc. maintained its forecast for crude oil to reach $85 a barrel by the end of this year on “robust” demand for diesel in China, the investment bank said in a report made public on Oct. 26.

Typhoon Koppu

Benchmark crude in New York traded at $77.73 a barrel as of 6:04 p.m. Hong Kong time. Domestic demand for diesel and gasoline has risen as car sales topped 1 million for the first time in September.

Lost output caused by Koppu was 2.34 million barrels this year, Cnooc said. Huizhou 21-1 has resumed output and other fields in the area will restart in the first half of 2010, the company said. Cnooc partners in Huizhou, which account for about 4 percent of output based on 2008 production figures, include Eni SpA and Chevron Corp.

Net daily production rose 18.4 percent to 647,382 barrels of oil equivalent in the third quarter, according to the statement. Cnooc produced 525,541 barrels of crude oil and 699 million cubic feet a day of natural in the period. Capital expenditure rose 10.3 percent to 11.24 billion yuan, Cnooc said.

Kosmos Stake

Cnooc plans to focus on exploration off the coast of China in the next three to five years, President and Chief Financial Officer Yang Hua told reporters on a conference call. He declined to comment on reports that the company is bidding for a stake in Kosmos Energy LLC’s Jubilee field and StatoilHydro ASA’s assets in the U.S. Gulf of Mexico.

Cnooc is in talks with Ghana to buy Kosmos Energy’s stake in the offshore Jubilee oil field, the Financial Times reported on Oct. 24, citing unidentified Ghanaian officials. The talks are being held in case a bid for the 23.5 percent stake by Exxon Mobil Corp. fails, the FT said.

Cnooc is in talks on buying assets in the U.S. Gulf of Mexico from Norway’s StatoilHydro ASA, Dow Jones reported on Oct. 16, citing a person familiar with the matter. Cnooc expects to buy stakes in deep-water blocks “soon,” Dow Jones said.

The Chinese producers’ shares have risen 64 percent in Hong Kong this year, compared with a 48 percent gain in the benchmark Hang Seng Index. The stock fell 4.5 percent to HK$11.50 today before the revenue announcement.

Cnooc’s nine-month pretax profit fell 46 percent from a year earlier to 28.31 billion yuan, the Wall Street Journal reported on Oct. 21, citing an unnamed person familiar with the matter. Revenue totaled 56.2 billion yuan in the same period, down 33.8 percent, the report said.

To contact the reporter on this story: Baizhen Chua in Beijing at bchua14@bloomberg.net

Last Updated: October 29, 2009 07:02 EDT