CNOOC Ltd

Best-in-class O&G giant with a green portfolio. As the largest offshore E&P company in China, CNOOC has a very competitive all-in cost of ~USD27/bbl. Coupled with its steady growth strategy and superior execution, CNOOC is highly regarded as one of the best oil price proxies. The group is also stepping up ESG initiatives, committing to spend 10% of capex in clean energy assets - particularly offshore windfarms. Promising output growth, attractive dividend. In its 2025 strategy preview, CNOOC expected production to grow 6%-8% to 760-780mmboe in 2025 and set a three-year rolling growth target of ~5%. The stock also offers a very attractive dividend yield of over 7%. Management has committed to a payout of at least 45% during 2025-2027. Maintain BUY with TP of HKD22, based on a DCF valuation (10.5% WACC, 0% terminal growth).