China Oilfield Services : COSL Announces Annual Results for 2016 Enhanced core competence ……

China Oilfield Services Limited ('COSL' or the 'Group'; HKSE stock code: 2883; SSE stock code: 601808), announced its audited financial statements for 2016.

During 2016, international oil prices remained at low levels. The oilfield services industry was still being impacted by low prices, and thus the Group's operation was under greater pressure. The Group achieved revenue for the year of RMB 15.086 billion. While after deducting total assets and goodwill impairment loss of RMB 8.273 billion, the loss of profit for the year amounted to RMB 3.187 billion.

Despite severe market conditions, the Group adjusted its stage strategies in a timely manner and speeded up the development of overseas markets and the technology segment. By reducing costs, improving efficiency and increasing international capacities, the Group successfully maintained its core competence in domestic and international markets. Different segments of the Group notched up victories in overseas markets and received 'Global Outstanding Contractor' from Shell and other international clients.

As to the drilling segment, the Group operates and manages 44 drilling rigs, 2 accommodation rigs, and 5 module rigs in total. 'COSLSUPERIOR' and 'COSLCRAFT' obtained the Middle East 2-year long-term operating contract, and NH8 and NH9 completed their operations in the Far East with high efficiency. For the Americas, the Group won the bidding for integrated service contract of offshore rig and utility vessels, which marks the first foothold in Gulf of Mexico by COSL's marine support segment and extend Group's industry chain successfully.

Regarding the well services segment, the Group has increased its operating capabilities through propriety research and development of technology and equipment. For instance, with the scale commissioning of technologies including RSS system and LWD, the application and promotion in domestic market were increased. The 3D acoustic logging instrument successfully completed the fracturing effect evaluation in the Bohai Bay for the first time, expanding the market of the Group's high-end logging equipment operation service. At the same time, the Group's international market expansion was further enhanced from obtaining the Middle East high-end directional drilling contract and the Indonesia Tropic IPM Service contract.

In the marine support services and geophysical and surveying services segments, new vessels such as 'HYSY 685' and 'HYSY 614' completed their operations with high quality in regions such as the Far East, laying the foundation for the subsequent market expansion. The vessel 'HYSY 720' completed the two operations of 3D seismic acquisition contracts in North Pole Barents Sea and won praises and endorsements from clients for providing safe, high-quality and efficient operation performance.

Mr. Qi Meisheng, CEO and president of COSL, stated that, 'In 2016, the global oilfield services industry faced the most severe situation in the history, and the Group also experienced a number of serious challenges during the period. Under this circumstances, relying on our excellent, efficient and safe operational performance, the Group won customers' recognition and respect by helping them to reduce costs and improve efficiency, further enhancing awareness of the COSL brand in the international market. While successfully maintaining its market share and leading position in the core market, the Group effectively explored new regions and new clients, expanded the scale of its IPM service and facilitated the application of propriety research and development results, in proactive efforts to achieve better operating results in 2017.'