China National Offshore Oil Corp (CNOOC) plans to put two advanced pieces of deep-water equipment capable of operating at depths of 3,000 meters into service in the South China Sea in the second half of this year, according to Chairman Wang Yilin. The drilling unit, named 981, is nearing completion after more than three years of construction in Shanghai. The 136-meter-high drilling platform, which cost CNOOC CNY6 billion, is expected to begin commercial operations in the northern South China Sea in the third quarter, following testing that will begin in Zhoushan city in Zhejiang province, Jin Xiaojian, General Manger of CNOOC’s Engineering Department, said. The unit was co-designed and constructed with China State Shipbuilding Corp, and will be operated by China Oilfield Services, one of the listed arms of CNOOC. Before the deep-water drilling platform, China was only able to explore, develop and produce off-shore oil and gas at depths of up to 300 meters. CNOOC aims to produce 50 million tons of oil equivalent from the deep-water field by the end of 2020, after reaching its first 50 million tons of oil equivalent from the sea last year. The platform is expected to reach break-even within 12 years. There are around 20 such deep-water semi-submersible drilling units in operation or under construction around the world. CNOOC also announced that China’s first deep-water crane vessel, which can lay pipes 3,000 meters below the surface, is expected to be completed in October. The vessel, like the drilling platform, was one of five types of vessels that CNOOC decided to build with a CNY15 billion total investment for deep-water exploration during the 11th Five Year Plan (2005-2010). The pipe-laying crane, named 201, is expected to start commercial operations in the Liuhua oilfield in the eastern South China Sea late this year, and is set to work in the Liwan 3-1 deep-water gas field next year, China’s biggest off-shore gas field with contingent reserves of up to 170 billion cu m of gas, the China Daily reports. CNOOC is also seeking foreign partners to develop 19 blocks off the Chinese coast. The deepest block reaches a sea depth of 3.5 kilometers. The company will spend CNY350 billion on energy production off the coast in the next five years.

Bayer broke ground for a new polyurethane plant in Qingdao’s Economic and Development Zone, with a total investment of between CNY200 million and CNY250 million. The project is part of Bayer’s plan to invest €110 million by 2012 to build five downstream facilities in China. One of the uses of polyurethane is isolation of buildings. According to Azita Owlia, Senior Vice President of Bayer MaterialScience’s polyurethane unit in the Asia-Pacific region, buildings are responsible for 40% of energy consumption and almost one-third of greenhouse-gas emissions worldwide. “With China’s construction expenditure rising at 9.1% annually through 2014, sustainability is our business model, and we are committed to helping shape China’s environmental future,” Owlia told China Daily. The 1,000-square-meter office complex at the Qingdao polyurethane plant will have a number of environmentally friendly features such as solar energy, geothermal systems and LED lighting to reduce energy use, and water-recycling capability. Michael Voigt, head of Bayer MaterialScience’s eco-commercial building unit in China, said the Qingdao building will be the fifth such structure developed by Bayer globally and its first in China. The Qingdao plant, scheduled to start production in 2012, will serve customers in diverse industries including automotive, construction, furniture and thermoplastic polyurethane. “Polyurethane demand in China is expected to grow between 7% and 10% on a yearly basis until 2014,” Owlia said. Bayer’s five downstream plants include three polyurethane plants, a new polycarbonate sheet facility and a polycarbonate color compounding and design center. The three new plants will be located in Shanghai, Qingdao and Chongqing, the China Daily reports. Bayer China achieved €2.9 billion of sales in 2010, to which Bayer MaterialScience contributed €1.8 billion.

The number of mainland buyers in the Hong Kong property market continued to increase in the first four months of the year despite the suspension of a scheme allowing them to gain residency by investing in real estate in the city. According to data from Centaline Property Agency, 8.7% of new and second-hand homes in Hong Kong were bought by mainlanders in the first four months of this year, compared with 7.7% in the second half of last year. As they are cash rich and invest heavily in luxury property, 13.8% of the total transaction amount was paid by mainlanders. They were particularly active in the primary market. About 25% of new flats were bought by mainlanders, up from 24% in the second half of last year. In the secondary market, the number of mainland buyers recorded sharper growth this year. About 7.7% of flats were bought by mainlanders, up from 6.5%. In October last year, the government announced that property investment had been temporarily suspended from the Capital Investment Entrant Scheme in an attempt to cool the overheated market. “The latest figures show the number of mainland buyers didn’t decrease after the suspension,” said Wong Leung-sing, head of Centaline’s Research Department. “That’s because only a limited number of mainlanders are buying homes in Hong Kong for immigration reasons. There are plenty of mainlander buying homes for investment only.” He expects the influx of mainland buyers will continue.

Beijing ranks at the top of an “attractiveness ranking” of upmarket retail investment opportunities in 18 cities compiled by property consultancy DTZ. Shanghai came in second, while Guangzhou was fifth and Shenzhen lower down the scale at 17th place. Second-tier cities were high scorers, with Chongqing third and Chengdu ranked fourth. Shenyang was not far behind at sixth and Wuhan was seventh. The ranking calculations were based on four criteria: consumer affluence (based on per capita retail sales in 2009); the opportunity to develop the retail space (based on average retail space per capita); sales growth forecasts over the next five years; and sentiment issues. According to the DTZ “Research China Insight – China Retail May 2011” report, Beijing outperforms other markets in projected sales growth, with an annual growth rate of 11.4% forecast for the next five years. The launch of new retail space, such as China World Trade Center Phase III, would improve and expand competition in Beijing’s high-end market, DTZ said. Hangzhou, which led the pack on per person retail sales, was ranked 11th after opportunity and growth factors were taken into account. China’s retail sector has become increasingly relevant to investors, with investment growing by 25% per annum over the last decade. The key question for many investors and developers was where to invest in the emerging high-end retail markets.

The Chinese government issued new regulations to govern the use of pre-paid shopping cards, which includes banning government officials from accepting such cards and requires names to be registered for large-value cards. The maximum amount on an unregistered prepaid shopping card cannot exceed CNY1,000, while that of a registered card must not exceed CNY5,000. Individuals or companies that purchase more than CNY10,000 worth of unregistered cards also have to register their names. Companies buying cards containing a value of more than CNY5,000 each or individuals buying cards worth more than CNY50,000 must pay through banks, rather than in cash, so that regulators will be able to monitor the transactions. Some companies also use the cards as payment to employees to avoid paying tax. The validity period of unregistered cards should be at least three years, while registered cards have no expiry date.