China Oilfield Services Limited Investor Presentation

January 2011

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The information contained in our presentation is intended solely for your personal reference. In addition, such information contains projections and forward-looking statements that reflect the Company’s current views with respect to future events and financial performance. These views are based on assumptions subject to various risks. No assurance can be given that future events will occur, that projections will be achieved, or that the Company’s assumptions are correct. Actual results may differ materially from those projected. Past track record cannot be use as guidance for future performances

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Macro and Industry Outlook for 2011

Company Prospects in 2011

Global Economy & Oil Price Trends Oil prices are expected to rise

Slow recovery of the global economy GDP Growth Global

Historial Price BNP JP Morgan Barclays Goldman Sachs

120

2008 2.8%

2009

2010E

-0.6%

2011E

4.8%

4.2%

110

CICC Morgan Stanley BofA Merrill Lynch UBS Average Price Forecast

103.0

100

96.5 90

85.6

Developed Countries

0.2%

Developing countries

6.0%

-3.2%

2.7%

2.2%

80

79.1 70

2.5%

7.1%

6.4%

Source: IMF forecasts

„ US economy saw steady recovery, but its

unemployment is still hovering at high levels „ Debt crises in Europe remain unresolved, creating

uncertainties for global economic recovery „ High inflation in emerging countries has impact

on fiscal and monetary policies „ Uneven paces of recovery of different

economies brought about potential unbalance to global economy

60 50 2006

2007

2008

2009

2010E

2011E

2012E

2013E

„ Institutions estimated global crude oil demand

will grow at 2.1% and 1.5% in 2010 and 2011 respectively „ Increases in demand will mainly come from

emerging economies, averaged at 4% and 3.2% in 2010 and 2011 respectively „ Idle capacities in OPEC and output growth from

non-OPEC countries will be able to meet the growth in demand in the next two years

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Increasing CAPEX of Oil Companies 油服市场有望回暖 US$ billion

25

2010E

2011E

20 15 10 5 0 Source: Barclays Capital

„ Aggregate capital expenditure on global oil and gas exploration will reach US$489.5 billion in

2011, up 10.8% yoy. The expenditure in for oil companies based in the Asia Pacific region will increase by about 9% yoy. „ CNOOC Group has successfully constructed an “Offshore Daqing” oilfield in China waters. Will

intensify its offshore oil and gas exploration, development and production efforts during the Twelfth Five-Year Plan. CAPEX of CNOOC will increase 55% yoy „ In deep-water operations, CNOOC plans to build 2 to 3 independent deep-water wells in 2011, while

the volumes of 2D and 3D seismic data collection are expected to reach 19,967 km and 17,129 km2. respectively

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油服 Scale of Global Oilfield Service Market Increases Unit: US$ billion

300

Size of global oilfield service market

40%

Growth rate

250 200

20%

150 100

0%

50 -20%

0 2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010E

Source: Spears & Associates Oilfield Market Report

The rebound on oil prices drove the recovery of global oilfield services market and demand, of which: z

the size of offshore drilling market increased slowly

z

the size of geophysical market started to rebound and is expected to increase significantly in 2011

z

MS&T saw growth in work volume and demand due to the rising importance of deep-water activities and increasing geophysical activities

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Drilling Market is Recovering Slowly 油服 Drilling rig utilization & contracted rates No. of Rigs (left axis)

With contract (left axis)

In operation (left axis)

Index for rig day rates and oil prices

Utilization rate (right axis)

Day Rate Index (LHS)

WTI (RHS) USD/Barrel

1,200

150

1,000

130

800

110

600

90

400

70

200

50

0

30

Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Source: ODS-Petrodata

Note: Day-rate index is derived according to the weighted average levels in major offshore drilling markets. 1994=100 Source ：Upstream, ODS-Petrodata, Bloomberg

„ Although oil prices have started to rebound, supply of drilling rigs still outstripped demand „ Utilization rate continued to rise yet with volatility, while day rates did not change significantly „ Recently, the demand for high-spec jack-up rigs is increasing in an obvious pace; differentiation in

service prices emerge as structural differentiation of large-scale equipment gathers pace

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Macro and Industry Outlook for 2011

Company Prospects in 2011

Strategic Plan for Next 5 Years

Structure optimization; Be competitive & professional; Focus on development quality

Technology-driven

Drilling

Cost Leadership

Integration

Internationalization

Reinforce advantages, gradually shift focus to high-end equipment, and speed up internationalization process

Well Services

Enhance R&D capability, increase R&D’s segmental contribution, upgrade technical strength, increase proportion of self-developed products to improve competitiveness

Marine Support & Transportation Services

Optimize fleet structure, move to high-end market, and lock in domestic market share

Geophysical

Focus on technological innovation, upgrade technical strength, optimize equipment structure, and seize opportunities to exploit new businesses

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Drilling*

Equipment Structure Optimization

Operation Depth (ft)

≤250 ft ≤250英尺 11 rigs

300 ft 300英尺 6 rigs

375 ft 375英尺 5 rigs

400 ft 400英尺 5 rigs

2500 ft 2500英尺 3 rigs

250

10,000 ft 10000英尺 1 rig

300

375 400

1500 2500 10000

No of vessels

已有

在建

Geophysical *

47 30

8 18

10 0

已有

10

40

20

1艘

• Realize phased equipment structure optimization and upgrade 1.Moving from shallow to deep waters 2.Lower overall age of drilling rig fleet, with over 50% of the JU aged less than 5yrs 3.Increase high-powered vessels in MS&T fleet and realize diversity 4.Optimize geophysical fleet and improve efficiency • Newly-built high-end equipment helped participate in international competition

No. of vessels 50

MS&T*

≥1500 ft ≤1500英尺 3 rigs

4

5

4

4

3

5

8

在建

1

6 4

8

2

1 4

0 Geophysical 物探船 Vessels

Exploration 工程勘察船Vessels

10 *Equipment count for drilling and geophysical segments as at 2012, vessels under construction until 2013

CAPEX & Equipment Delivery Plan Capacity Enhancement

2010 • Two 350-feet drilling rigs commenced operation • Two 200-feet drilling

Drilling

rigs(921&922 ) delivered • Pioneer delivered

•Two 200-feet drilling rigs(921 &922 ) to commerce operation

MS&T

•Innovator to commence operation

to be delivered

•Promoter to be delivered

•Pioneer to commence operation

•Equipment to be delivered in 2011

•Innovator to be delivered

will bring more operation days in

delivered*

Well Services

•Pioneer operating days to increase

• Two 200-feet drilling (923&924)

•Ultra deep water HYSY 981 to be

• Two liftboats

2012

2011

2012. Working volume in deep-water business will further enhanced

•Deep water related well services

• Well services equipment

•Vessels introducing acidification and crushing delivered for operation

• 1 well-workover support barge

• 2 deep water ATHS vessels • Underwater cable team

Geophysical

• 1 underwater cable team

•12-streamer seismic vessel, deep-water survey vessel

‡ CAPEX in 2011 is expected to be RMB4.72 billion ‡ Over 90% of large-scale equipment are covered by service contracts in 2011

•

*Invested & constructed by CNOOC and operated & managed by COSL

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New Business, New Expansion „ Output enhancement met new requirements for extraction of heavy and thickened oil in China

waters, providing huge potential for COSL well services „ Respond to clients’ demand and apply certain oilfield technologies into new areas

Wide application of steam injection on location in oilfields ‡ Achieved revenues of more than RMB100 million a year ‡ Increasing use of injection techniques effectively enhanced output

Enhance reservoir recovery through acidification and related services ‡ Engage in acidification, pumping, water shutoff, CO2 expulsion operations ‡ Increasing application of integrated acidification and CO2 expulsion techniques

Low permeability oil reservoir exploration by fracturing techniques ‡ Technical innovation to apply land fracturing techniques in offshore exploration ‡ Fracturing and related operations to drive output enhancement businesses

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Deep-water Operations

z

Engage in deep-water exploration and research, and achieved progresses in

Liuhua29-1

deep-water seismic data collection, processing and identification of geological and reserve properties.

z

COSL’s deep-water operations in China

Liuhua34-2

come to live following deliveries of the ultra-deep-water semi-submersible Liwan3-1

platform HYSY981, deep-water exploration vessels and 2 utility vessels.

Source:: CNOOC

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Market Expansion Planning

Norway

China Gulf of Mexico

Vietnam Indonesia

Overseas operating regions

Australia

z

Maintain a leading position in offshore China

z

Proactively expand overseas business and accelerate international strategy planning and development pace

z

CNOOC’s international business development provides potential for COSL’s global expansion

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