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China's biggest offshore oil driller CNOOC Ltd said on Wednesday it plans to step up deepwater exploration this year, despite ongoing island disputes between China and its neighboring countries.

The State-owned company plans to spend up to $2.66 billion on exploration, up from $2.11 billion in 2012. A total of 140 exploration wells will be drilled, up from 138 in 2012.

"Exploration programs in 2013 remain intensive, and more efforts will be made in deepwater exploration," Zhong Hua, CNOOC's chief financial officer, said at a news conference in Hong Kong.

He refused to give an exact breakdown of the company's budget for deepwater exploration.

CNOOC's plans for deepwater exploration come amid island disputes between China and its neighbors including Vietnam, the Philippines and Japan.

China strongly protested and strengthened patrols in waters around its Diaoyu Islands after Japan last year "nationalized" the uninhabited islands in the East China Sea. The country has also exchanged barbs recently with Vietnam and the Philippines over islands in the South China Sea.

China's newly elected top leader Xi Jinping said on Tuesday China will never bargain over its "core" territorial and security interests and no foreign country should "nurse hopes that we will swallow the bitter fruit of harm to our country's sovereignty, security and development interests", according to the Xinhua News Agency.

China watchers said Xi's first comments on foreign policy since he took office map out China's strong stance on disputed islands.

CNOOC plans to start production at 10 new offshore oilfields in Chinese waters this year, with 24 more projects under construction. Seven of the 10 new fields are located in the South China Sea and one in the East China Sea. But Zhong added that there are no territory disputes in any of the 10 new fields.

As part of its deepwater push, the company's Liwan 3-1 project, China's first large-size deepwater gas field, will start production at the end of 2013.

The new fields are expected to help CNOOC achieve a 2 percent production increase this year from 338 to 348 million barrels. Production for 2012 is estimated at 341 to 343 million barrels.

CNOOC is now in the middle of what could be China's largest-ever overseas takeover, having bid $15.1 billion for Canadian oil company Nexen Inc. The deal has passed Canadian examination and is awaiting approval from regulators in the United States.

Last week, the two companies decided to extend the deal's deadline by 30 days, raising worries that it might fall apart.

Zhong said CNOOC is actively cooperating with US regulators and is "very confident" the deal will go through in the first quarter of this year.