Soaring Profits for Listed Oil CompanyHelped by high oil prices, half-year profits more than doubled at China's largest oil and natural gas producer, PetroChina Co., the company reported Thursday.Cost-saving measures also helped lift PetroChina's net income for the six months ending June 30 by 106 percent to 23.1 billion yuan (US$ 2.8 billion), up from 11.2 billion yuan in the same period a year earlier. Higher sales of natural gas products and increases in sales and prices of refined and petrochemical products further contributed to stronger earnings, the company said. Total sales rose 49 percent to 110.9 billion yuan (US$13.4 billion), compared to 74.6 billion yuan in the same half-year period a year earlier. Average crude oil prices rose 73.4 percent in the first half of the year, a windfall for state-owned PetroChina. The earnings report was the first since PetroChina raised about US dlrs 3 billion through an initial public offering April 6 on the New York and Hong Kong stock exchanges. By selling off 15 percent of its shares, PetroChina raised cash that will help it pay for new technology, retailing, exploration and production as well as construction of a natural gas pipeline from oil-rich western China to industrialized areas in eastern China where demand is greatest. The Chinese government retains an 85 percent stake. PetroChina said it produced a total of 384 million barrels of crude oil in the first six months of the year, averaging 2.11 million barrels a day. It also produced 241.2 billion cubic feet of natural gas. The company said it would continue to cut costs and improve efficiency, while shifting its focus away from increasing crude oil production to maximizing productivity. Like other bloated Chinese state-owned enterprices, PetroChina has struggled to cut costs. Ahead of its April share offering, it shifted 1 million workers to other divisions of parent company China National Petroleum Co. It has pledged to further trim its remaining 480,000-strong workforce. The petroleum business is viewed by the Beijing leadership as a strategic industry requiring special attention for the sake of national security and economic development. PetroChina is among a number of major Chinese firms reporting stronger profits this year amid signs that restructuring of inefficient state-run industries is making some progress. The State Statistical Bureau reported Tuesday that profits by China's industrial enterprises rose 110 percent on year to 202.2 billion yuan (US$ 24.5 billion) between January and July, while state sector industry profits rose 190 percent on year to 113.2 billion yuan (US$13.7 billion). Meanwhile, the red ink at loss-making enterprises fell 9.9 percent to 78.5 billion yuan (US$ 9.5 billion). |
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