Can Natural Gas Development Drive PetroChina Further?
Stephen Simpson, CFA
Stephen Simpson, CFA
Oct. 15, 2013, 11:51 AM
- Korea Gas says it may sell part of its 20% stake in the LNG Canada natural gas project as part of an effort to reorganize its finances.
- LNG Canada is a joint venture involving Kogas, Royal Dutch Shell (RDS.A, RDS.B), Mitsubishi and PetroChina (PTR) that plans to build and operate a liquefied natural gas export terminal in Kitimat, British Columbia.
- South Korea's state energy firms have taken on massive debt in recent years as part of their quest to acquire overseas resources to bolster the country's energy security, but the government now is looking to sell some of those assets.
Oct. 14, 2013, 3:22 PM
- The downside of the U.S. natural gas boom is that, at historically low prices of ~$3.75/MMBtu, "some of the levered players are struggling to cover their debt service and their obligations to drill more holes under their leases," Jim Chanos tells CNBC.
- The boom in nat gas supplies, and the subsequent low prices, is "bad news for global coal as more and more countries switch over to natural gas," he adds.
- Chanos is short two different groups of the major oil companies: the big publicly traded majors like Exxon (XOM) - "their problem is finding costs" in reserves like deepwater drilling and the Arctic - and the nationalized companies such as Petrobras (PBR), Ecopetrol (EC) and PetroChina (PTR), which he says really are "political venues."
- ETFs: FCG, GASL, GASX.
Oct. 8, 2013, 11:42 AM
- Kazakhstan's giant Kashagan oilfield is pumping 61K bbl/day after resuming production halted by an accident last month, according to the head of Kazakh state oil and gas firm KazMunaiGas.
- An international consortium developing the huge reservoir estimated to contain 9B-13B recoverable barrels of oil has to achieve what is called "commercial output" of 75K bl/day this month to meet contractual obligations.
- KazMunaiGas, ExxonMobil (XOM), Royal Dutch Shell (RDS.A, RDS.B), Eni (E) and Total (TOT) each hold 16.81% stakes in Kashagan, China National Petroleum (PTR) acquired 8.33% this year, and Japan's Inpex owns 7.56%.
Oct. 2, 2013, 2:59 PM
- Brazil's National Petroleum Agency says all 11 companies registered for the Oct. 21 auction of the Libra offshore oil field have qualified to participate in the sale.
- Brazil had previously approved eight firms, but was still reviewing technical and legal documents for France's Total (TOT), Colombia's Ecopetrol (EC) and the Brazilian unit of Portugal's Galp Energia (GLPEF.PK, GLPEY.PK).
- Also approved to bid: Chinese oil companies Cnooc (CEO) and China National Petroleum (PTR); China's Sinopec (SNP) also registered via its joint venture with Spain's Repsol (REPYY.PK, REPYF.PK); Malaysia's Petronas; Japan trading firm Mitsui (MITSY.PK, MITSF.PK); India's ONGC; Royal Dutch Shell (RDS.A, RDS.B) and Brazil's own Petrobras (PBR, PBR.A).
- Officials estimate the 11 companies could form up to three potential bidding groups to compete in the auction.
- Several oil majors are not participating in bidding on Libra, whose development is expected to be pricey.
Oct. 1, 2013, 6:23 PM
- Chinese state-controlled oil companies will be limited to joint bids to develop Brazil's Libra prospect, amid concerns the firms could share data and reduce competition at the Oct. 21 auction, Brazilian officials say.
- China's Cnooc (CEO) and China National Petroleum (PTR) are controlled by the Chinese government and would have to team up for a potential bid if both companies want to participate; it's unclear whether Sinopec (SNP) could bid on its own, since it registered for the auction via its joint venture with Spain's Repsol (REPYY.PK, REPYF.PK).
- The move threatens to further water down bidding in Brazil's first-ever auction under new production-sharing agreements after oil majors such as Exxon, BP and Chevron declined to participate.
Sep. 19, 2013, 6:15 PM
- More on Brazil's planned auction of the Libra oil prospect: Only 11 companies registered to participate - far fewer than the expected 40 - and some of the biggest firms backed out, including Exxon (XOM), Chevron (CVX) and BP (earlier).
- Asian state-owned companies dominate the list of participants: India's ONGC, Malaysia's Petronas, Colombia's Ecopetrol (EC), China's Cnooc (CEO) and China National Petroleum (PTR); China's Sinopec (SNP) will take part through joint ventures with Brazilian units of Spain's Repsol (REPYY.PK, REPYF.PK) and Portugal's Galp Energia (GLPEF.PK).
- Also taking part: Shell (RDS.A, RDS.B), Total (TOT) and Mitsui (MITSY.PK, MITSF.PK).
- Analysts blame the lack of interest on new rules drawn up by Brazil's government that place development and profits under greater state control; too many companies don't want "the trouble of dealing with Petrobras (PBR) and the government. You can get good oil assets elsewhere without that."
- ETFs: EWZ, BRF, EWZS, BRAF, BRXX, UBR, BZQ, BRAZ, BRAQ, BRZS, BRZU.
Sep. 19, 2013, 8:23 AM
- A major supplier to PetroChina (PTR) says Chinese authorities have seized its records and temporarily frozen some of its bank accounts, adding it was no longer able to contact its chairman, who had been assisting authorities in an investigation.
- The news comes amid a corruption probe that has targeted former and current high-ranking executives at state-owned CNPC and its listed unit PetroChina, which began last month.
Sep. 18, 2013, 2:49 PM
- Venezuela's PDVSA signs a new $14B deal with China National Petroleum (PTR +1.4%) to develop heavy-oil deposits in the country's Orinoco belt, according to the company's oil minister.
- The Orinoco region holds one of largest oil reserves in the world, and PDVSA is working on projects there with foreign partners including Italy's Eni (E), Spain's Repsol (REPYY.PK, REPYF.PK) and Russia's Rosneft (RNFTF.PK).
- CNPC already has minority stakes in two other Orinoco belt projects with PDVSA.
Sep. 18, 2013, 10:57 AM
- Kazakhstan, whose giant Kashagan oilfield started output last week, expects the deposit to achieve commercial production in October and produce ~8M metric tons of crude in 2014, the country's oil and gas minister says.
- Central Asia's largest economy and the second-largest ex-Soviet oil producer after Russia, Kazakhstan has forecast Kashgan will produce 1M bbl/day from 2020 and eventually reach 1.5M.
- KazMunaiGas, ExxonMobil (XOM), Royal Dutch Shell (RDS.A, RDS.B) and Total (TOT) and Eni (E) each hold 16.81% stakes in Kashagan; China National Petroleum (PTR) acquired an 8.33% stake this year, and Japan's Inpex owns 7.56%.
Sep. 18, 2013, 8:07 AM
- Major Western oil companies are negotiating with the Iraqi government to cut their oil production targets in the country, reducing Iraq's overall production target of 12M bbl/day, a senior Iraqi oil official says.
- BP and partner China National Petroleum (PTR) are in talks to reduce the plateau target for the Rumaila field to 2.1M bbl/day from 2.85M; the two currently produce ~1.4M bbl/day from the field.
- Shell (RDS.A, RDS.B) and partner, Malaysia's Petronas, are negotiating to reduce its target at the Majnoon field to 1.2M bbl/day from the agreed plateau of 1.8M; Majnoon is expected to start first production this month at 175K bbl/day.
- The Exxon-led (XOM) consortium operating the West Qurna-1 field is in advanced talks to lower its target to 1.8M bbl/day from 2.825M; it is now producing ~450K bbl/day from the field.
Sep. 17, 2013, 2:44 PM
- China plans to spend ~80B yuan ($13B) exploring oil and gas exploration this year in a quest to bolster energy supplies and reduce dependence on imports, according to state media reports.
- The world's largest energy consumer has steadily increased exploration expenditures to 67.3B yuan in 2011, up from 19B in 2002, leading to discoveries of 5B-plus metric tons (36.75B barrels) in oil reserves and 2.6T cubic meters in nat gas reserves between 2008 and 2011, but China still imported ~58% of its oil and 30% of its natural gas in 2012.
- Related stocks: PTR, SNP, CEO.
Sep. 17, 2013, 10:52 AM
- Analysts say the corruption probe around PetroChina (PTR +0.3%), though painful and embarrassing, could be exactly what's needed to elevate China’s leading oil company to the global top tier not just in size but also in performance.
- The detentions of executives have raised questions about how much of PTR’s underperformance has been related to poor business decisions, and how much was the result of alleged corruption.
- PTR’s production revenues declined last year despite increasing volumes, flat oil prices and higher gas prices - three factors that should have guaranteed an increase in revenues, but Jefferies' head of Asian energy research says that rather than a negative, it is an illustration of PTR’s true potential.
Sep. 11, 2013, 8:44 AM
- China Oil & Gas, a joint venture partner with PetroChina (PTR), denies a local newspaper report that one of its former executives is being investigated as part of the government's corruption probe.
- The Chinese government said earlier this month it was investigating Jiang Jiemin, a former chairman of PTR and parent company China National Petroleum for "serious discipline violations," shorthand generally used to describe graft.
Sep. 11, 2013, 8:14 AM
- An £8.3B ($13B) project to build a refinery and petrochemical plant in eastern China involving Royal Dutch Shell (RDS.A, RDS.B), China National Petroleum (PTR) and Qatar Petroleum reportedly has been shelved after losing political support.
- The plant in the eastern city of Taizhou would have refined 20M tons/year of crude oil and produced 1.2M tons/year of ethylene; construction had been due to start last year.
Sep. 10, 2013, 7:54 AM
- PetroChina (PTR) is considering investing ~$10B in Russian gas fields as part of efforts by China and Russia to conclude gas-supply negotiations that have dragged on for almost a decade, Bloomberg reports.
- The assets drawing PTR's interest are located near the Siberia to Far East pipeline Gazprom (OGZPY.PK) plans to build; the pipeline, which will supply China and also bring gas to a planned liquefied natural gas plant for supplies to Japan and Korea, may become fully operational by late 2017.
- The two countries are seeking to complete a deal that would see Russia supply as much as 68B cubic meters of gas a year; a $10B deal would mark PTR’s biggest-ever purchase abroad.
Sep. 9, 2013, 7:54 AM
- PetroChina (PTR) denies a report by China Business News alleging that more of its executives are being investigated by Chinese authorities, after trading in PTR shares is resumed in Hong Kong following an earlier suspension.
- The report said five executives, including vice president Sun Longde and director Wang Guoliang, had been detained, but PTR says both men continue to work as usual.
- Chinese authorities said two weeks ago that former China National Petroleum chairman Jiang Jiemin was under investigation for corruption.
PetroChina Co. Ltd. engages in the exploration, development, production and sale of crude oil and natural gas. The company also involves in the refining of crude oil and petroleum products, production and marketing of primary petrochemical products, derivative chemical products and other... More
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Industry: Major Integrated Oil & Gas
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