Cnooc Ltd jumped as much as 44% in its first day of trading in Shanghai as mainland investors leaped at the chance for exposure to soaring oil and gas prices.
The company’s A-shares soared to as high as 15.55 yuan ($2.43), rising by the daily limit, after pricing at 10.80 yuan. The stock trimmed gains to finish the first day of trade at 13.79 yuan, up 28%.
China’s biggest offshore driller is raising 28 billion yuan ($4.3 billion) with the issuance after it was delisted by the New York Stock Exchange following US sanctions. The A-share debut was the largest in China and the fourth largest globally this year, according to data compiled by Bloomberg.
“We will take this opportunity to make full use of domestic and overseas financing channels to promote the high-quality and sustainable development of the company,” Chairman Wang Dongjin said in a statement.
The company drills for oil and gas off the coast of China and around the world, including a large stake in Exxon Mobil’s massive Guyana project. Its operations in the South China Sea led the Trump administration to add the firm to a blacklist in January 2021 and accuse Cnooc of being a “bully” for China’s military efforts in the contested waterway.
For investors, Cnooc offers more direct exposure to high oil prices than its fellow state-owned Chinese oil giants PetroChina Co. and Sinopec, which both have massive refining and fuel-selling businesses. The Brent benchmark continues to trade above $100 a barrel after Russia’s invasion of Ukraine upended global trade flows.