COSL Social Responsibility Report for 2007

Driven by an ongoing booming cycle in the global oilfield services industry in 2007, COSL achieved a remarkable leapfrog development during the year. With scientific development as its perspective, world-class operation as its target, shareholder interest maximization as its objective, the four core strategies as its driver and advanced corporate culture as the incentive, all tasks registered new growth and breakthrough during the year.

As a responsible corporate citizen, alongside with its ongoing pursuit of improvements in service quality, COSL actively participated in charity activities and proactively exhausted alternatives to contribute and pay tribute to the society. In addition to generating earnings, COSL also fulfilled its commitment to shoulder social responsibilities for its stakeholders (staff members, society and the environment) as it observed business ethics, reinforced production safety, respected legitimate rights of staff members, helped protect the environment and conserve natural resources.

1. Caring for staff development?

The 7,343-strong staff force employed by COSL in different positions had been working diligently to achieve maximization of the Company’s value. They are behind COSL’s outstanding results and represent the most valuable asset of COSL. Even down to the day-to-day business operation level, COSL maintains its emphasis on treating staff members as its most valuable asset.

To comply with the Law of People’s Republic of China on Employment Contracts, COSL has made many attempts on enhancing the working and living conditions of its staff members. These attempts included improving the accommodation and catering for staff members who are still single or still fresh from college, enhancing the living conditions in mobile vessels, ongoing upgrading their protective gears and continuing to exhibit care for health of its staff members by implementing across-the-board health check-ups for all employees.

2. Protecting the environment, reducing energy consumption and emission

COSL treats conservation of the environment as one of its responsibilities as a corporate citizen and a layer of protection to ensure sustainable development. Conservation of the environment and implementation of safety measures constitute the basic pillars of ground work that COSL has been striving hard to pursue in the course of acquiring its position as a world-class oilfield services provider.

Reducing energy consumption and emission represents COSL’s strategic response to the global climatic change. At present, abrupt changes in global climate presents a steep challenge to the survival of human beings. Climatic changes not only expose economic development to higher vulnerability, they also initiate ecological and public hygiene disasters at a global scale, threatening the sustainable development of the human society.

COSL regards reduction of energy consumption and emission as a major task. The Company adopts the statutory standards on energy consumption stipulated by the Government as its minimal standard. Safety of the environment and protection of it constitute the foundation of the Company and a layer of guarantee supporting our sustainable development.

As a people-oriented company, COSL has placed emphasis on healthcare and occupational safety for its staff members. Through various efforts, COSL has gradually cultivated corporate culture that cherishes safety and environmental protection and intertwines reduction of exploitation of natural resources into the fabrics of its day-to-day operation. This culture has become a model code of behavior for all COSL staff that raised their consciousness on environmental protection. These hopefully will ultimately sublime to achievement of the objective of “Healthy Staff, Safe Production and Environmental Protection”.

3. Engaging in charity activities

In recent years, COSL has made solid inroad into charity services. To ensure healthy development of charity services, COSL established a charity work committee with a well defined frame of responsibilities. Since 1996, COSL’s predecessor, Petrotech Services, CNOOC, made donations to establish Offshore Oil Hope Primary Schools in Wafangcun, Jingoutun Town, Luanping County and in Xunkoucun, Bailongxiang, Mancheng County in the old revolutionary province of Hebei.

By continuous devoting manpower and resources into two “Hope Primary Schools” from COSL for about 11 years, the teachers’ qualification and teaching quality were top ranked in that region.

Since 2005, COSL donated an aggregate of RMB 800,000 to establish scholarships for dozens of tertiary educational institutions including University of Petroleum (East China), Jimei University, Chongqing Institute of Technology, Daqing Petroleum Institute and Southwest Petroleum University. These scholarships sponsored tuitions for students with good academic results and conduct facing financial challenges.

To offer assistance to education in remote areas, COSL donated RMB 8,000,000 to “Project Hope” on 20 November 2007 for building the “COSL Hope Primary School” in Yunnan and Hainan regions. COSL also formed inspection teams to pay visits to seven schools such as Shumuke Primary School in Luozehe Town, Yiliang County, Zhaotong City in Yunnan regions in order to ensure the donation was deployed effectively and efficently.?

Over the past decade, COSL staff actively participated in various social and welfare projects including “Mothers’ Water Cellar” and “Health Express” as well as fund-raising and donation activities in order to help the poor and relieved victims from disasters. They expressed enthusiastic responses and donate generously to every fund-raising event, illustrating their care for the community.

COSL will join hand with various parties to continue to fulfill its responsibilities and contribute to the community for building a brighter future.