Production from Statoil's Lufeng 22-1 field in the South China Sea is being extended for up to two years from next February.
The additional output could total more than seven million barrels of oil with a gross value of USD 120 million.
Statoil, the state-owned China National Offshore Oil Company (CNOOC) and Norway's Lufeng Development Company (LDC) have extended the charter for multipurpose shuttle tanker Navion Munin with associated production equipment to 2002.
LDC belongs to shipping and offshore company Navion, which owns the ship, and Norway's Advanced Production Systems, which provides the processing equipment.
Lufeng has been producing more oil at a lower cost than previously estimated, reports Arnfinn Jøssang, head of Statoil's operations in China.
Although field profitability was hit by low oil prices last year and in the first few months of 1999, he expects to recover a substantial proportion of the earlier losses with today's market prospects and through efficient operation.
Lufeng began production on 27 December 1997, and is due to have flowed roughly 19.4 million barrels by the end of November. That figure should reach 27.5 million in February 2002.
Statoil has a 75 per cent interest in the field through its Statoil (Orient) subsidiary. CNOOC has 25 per cent. The two companies have established a joint operating organisation.