Fri, Jul. 17, 5:54 PM
- As exploration costs fall, Morgan Stanley's emerging markets analysts see the most upside for China's Cnooc (NYSE:CEO), Argentina's YPF and India's ONGC.
- Cnooc boasts the third-largest production growth rates among emerging markets E&P players, the highest realized oil prices and lowest costs within China's top three oil companies, and better production and development know-how than PetroChina (NYSE:PTR) and Sinopec (NYSE:SNP) on offshore reserves, Stanley says.
- YPF's current valuation is attractive due to the near-term growth of the existing asset base, leaving a sizable unconventional upside as a free option, and forex pass-through in fuel prices has been working over the past five months and protecting margins, the firm says.
- Stanley suggests avoiding Gazprom (OTCPK:OGZPY), Ecopetrol (NYSE:EC) and Petrobras (NYSE:PBR), which it calls its least favorite stock as the company will continue to generate negative free cash flow through 2018 and cash flows primarily will service bondholders to the detriment of equity holders.
Tue, Jul. 7, 12:27 PM
- China's crude oil production looks set to rise this year from a record 4.2M bbl/day in 2014 as new production from Cnooc (NYSE:CEO) helps to counter reductions from its two bigger domestic rivals, PetroChina (NYSE:PTR) and Sinopec (NYSE:SNP).
- While there is no official Chinese production outlook, information from the biggest state oil companies indicates China's output will rise slightly in 2015, largely due to increased production from Cnooc.
- China raised its output in the first five months of this year by 1.8% Y/Y to 4.25M bbl/day, vs. growth of just 0.1% over the same period in 2014.
Wed, Jun. 17, 6:23 PM
- Canada's environment ministry says it has approved the Royal Dutch Shell-backed (RDS.A, RDS.B) Canada LNG liquefied natural gas project in British Columbia, contingent on complying with 50 conditions throughout the life of the project.
- British Columbia's provincial government also issues an environmental certificate for the project, listing 24 conditions including monitoring its environmental impact and ongoing consultation with aboriginal people and local communities.
- The Shell-led project, which is expected to have cost as much as C$40B ($32.7B) when complete, is one of 19 such projects proposed for the B.C. coast as companies seek to export cheap Canadian gas to Asia.
- LNG Canada, which also is backed by PetroChina (NYSE:PTR), Korea Gas and Mitsubishi, has not yet made a final investment decision on the project.
Wed, Jun. 17, 9:57 AM
- China’s anti-corruption investigators continue to zero in on the country’s oil giants, calling on CNPC (NYSE:PTR) and Cnooc (NYSE:CEO) to review their overseas investments and accusing them of nepotism.
- The Communist Party’s top anti-graft agency says officials at CNPC used their power to help friends and family win contracts and promotions, and used company money for private purposes, adding that it had found similar problems at Cnooc.
- China's anti-graft campaign has snared ~100K officials of various levels in the past two years, with CNPC losing more than a dozen senior officials to investigations since August 2013.
Tue, May 26, 9:17 AM
- China National Petroleum subsidiary PetroChina (NYSE:PTR) reportedly has discovered more than 100M metric tons of of tight oil geological reserves in its Changqing field, the first Chinese tight oil find to surpass 100M metric tons.
- Technically recoverable reserves may be much lower: Tight oil production capacity in northwest China's Ordos basin, where the field is located, reportedly is more than 1M metric tons/day.
- In Q1, Changqing produced 6M metric tons of crude oil, or 487.6K bbl/day.
Wed, May 13, 10:14 AM
- The Chinese government is looking at stripping Sinopec (SNP -0.7%) and PetroChina (PTR -0.4%) of their oil and gas pipelines and spinning off the assets into independent businesses, Bloomberg reports.
- The separation of the pipeline units would be part of Pres. Xi Jinping’s reforms to allow markets a more decisive role in the economy.
- CNPC and its listed arm PTR is China’s biggest owner of pipelines, controlling ~77K km, while China Petrochemical and its listed unit SNP is next with more than 30K km; the assets could be worth as much as $300B, according to an estimate by Bernstein's Neil Beveridge.
Mon, May 4, 4:23 PM
- Chinese oil industry officials and government advisers are pushing back against a proposal that could combine China’s already massive energy companies into new national champions, WSJ reports.
- The merger discussions, which are preliminary and ongoing, reportedly have been met with skepticism from economists who say China needs more competition to nurture long-term growth and rebalance the economy.
- One option being studied by China involves combining CNPC (NYSE:PTR) and Sinopec (NYSE:SNP), while others include merging Cnooc (NYSE:CEO) and Sinochem, as China's leadership views bigger and stronger state companies as key to the country’s reasserting its prominence in the world.
Mon, May 4, 8:49 AM
- Sinopec (NYSE:SNP) confirms that Chairman Fu Chengyu is retiring, to be replaced by Wang Yupu, deputy head of the Chinese Academy of Engineering.
- Also, as part of a broad executive shake-up in China's energy industry, former CNPC (NYSE:PTR) exec Wang Yilin is expected to Cnooc (NYSE:CEO) and take over as CNPC chairman, to be replaced by the company’s president, Yang Hua.
- Fu, the most recognized exec in the Chinese energy industry, became SNP chairman in 2011 after more than 30 years with Cnooc.
- Morgan Stanley writes that "investors are likely to turn more cautious on the reform outlook for Sinopec - they don’t know whether the new management team will be as aggressive as Chairman Fu in driving reform."
Tue, Apr. 28, 12:48 PM
- "PetroChina’s (PTR -2.8%) share price has decoupled from underlying performance and fundamentals,” says Bernstein analyst Neil Beveridge after shares surged yesterday even as China’s biggest oil company reported its worst quarterly performance since 2008.
- Shares of top China refiner Sinopec (SNP -1.3%) also have rocketed upward in recent weeks, and continued to rise for a time even after the government announced it was investigating the president of SNP’s state-owned parent company as part of a major anti-corruption drive.
- Lower oil prices means companies such as PTR make less money off each barrel they pump out of the ground, and demand has waned for products like diesel as China’s industrial activity has weakened.
- Investors are betting that China’s government wants to combine the two state-run giants a new national oil champion that could aggressively compete with world's giants, even though Beveridge thinks a merger is "highly unlikely given that it reverses the trend of increased competition within the industry.”
Mon, Apr. 27, 12:49 PM
- PetroChina (PTR +3.2%) is higher even after reporting a larger than expected 82% drop in Q1 profit due to lower international crude prices and inventory writedowns at its refining division.
- PTR's Q1 net profit tumbled to 6.15B yuan ($989M), its lowest since Q3 2007, from 34.2B in the year-ago period and well below the analyst consensus average of 9.98B yuan.
- Q1 sales fell 22% to 410B yuan and the average realized crude price was halved to $48.87/bbl from a year ago; oil and gas output rose 4.9% to 381M boe.
- Earlier: PetroChina, Sinopec surge on industry merger speculation
Mon, Apr. 27, 11:48 AM
- Sinopec (SNP, SHI) and PetroChina (NYSE:PTR) are dismissing reports that their parent companies could merge to create a state giant, saying they have never received any official information about such a restructuring.
- It is the first time Sinopec and PTR have formally downplayed Chinese and foreign media reports in recent months that the government is considering merging Sinopec's parent with China National Petroleum, which controls PTR.
- Shares are off earlier highs but still sport strong gains, particularly SHI, up nearly 15% in U.S. trading.
Mon, Apr. 27, 8:15 AM
- PetroChina (NYSE:PTR) and Sinopec (SNP, SHI), China’s two largest oil explorers, jumped by their daily trading limit in Shanghai on speculation the government is considering consolidating the industry.
- PTR jumped 10% to 14.65 yuan, the highest in more than five years, and SNP also surged 10% to 8.56 yuan at the close in Shanghai; in U.S. premarket action, PTR +5%, SNP +5.7%, SHI +17.1%.
- A report also said China’s state-assets regulator may cut the number of government-owned enterprises to 40 from 112 through mergers and restructuring.
- Earlier: Chinese shares continue powerful ascent
Tue, Apr. 7, 2:52 PM
- Iranian oil officials are in Beijing this week to discuss oil sales and Chinese investments in Iran, with Iran's oil minister set to make his first trip to Beijing since joining the then new government two years ago.
- Officials from state-run National Iranian Oil Company are expected to meet with Sinopec (NYSE:SNP) trading arm Unipec and state trader Zhuhai Zhenrong; a new condensate deal with the latter is set to lift China's total crude oil contract volumes to above 600K bbl/day later this year.
- SNP, Cnooc (NYSE:CEO) and CNPC (NYSE:PTR) signed preliminary pacts with Iran before 2010 on development projects worth tens of billions of dollars, but Chinese firms slowed or scaled back activities on worries that U.S. sanctions on Iran would hurt their businesses in the U.S.
Fri, Mar. 27, 2:56 PM
- Cnooc (CEO +4.8%) says it will shelve its shale gas project in Anhui province, in the latest sign that the U.S. shale gas revolution is unlikely to replicate itself in China.
- CEO Li Fanrong says the company had drilled near Wuhu, in southern Anhui, since late 2011, but decided the block is not suitable for development on a large scale.
- Cnooc joins PetroChina (NYSE:PTR), which has already sharply cut back on a shale project in Sichuan province it was developing with Royal Dutch Shell.
- Cnooc tried but failed to interest foreign investors in the Wuhu block, but potential partners have shied away in part because of the dense population in the area; similar concerns held back the PetroChina-Shell project in Sichuan.
- Earlier: Cnooc surprises with 6.5% profit gain despite oil price plunge
Fri, Mar. 27, 11:57 AM
- PetroChina (NYSE:PTR) says it is actively involved in talks with international oil companies about swapping assets in North America to help it ride out lower crude oil prices.
- Because of weak oil prices, "any asset disposal will lead to big losses for any big international oil companies. If we could strengthen co-operation and swap assets, it will help us restructure overseas assets and complement each other,” Vice Chairman Wang Dongjin says, without naming the companies involved in the negotiations.
- PTR plans to cut nearly 10% from E&P spending compared with last year, joining the rest of the industry in trimming budgets in response to the nearly 50% plunge in oil prices since last summer.
Thu, Mar. 26, 8:49 AM
- PetroChina (NYSE:PTR) says its net profit fell 17.3% last year to its lowest annual profit in five years, as falling crude oil prices squeezed earnings.
- PTR says its net income dropped to 107.2B yuan ($17.2B) from 129.6B yuan a year earlier, while revenue rose 1.1% to 2.28T yuan from 2.25T a year earlier.
- Capital spending for 2015 will be reduced by 8.8% at 266B, adding to last year's 8.4% reduction; the move follows similar cuts by Chinese state-owned rivals Sinopec (NYSE:SNP) and Cnooc (NYSE:CEO).
- Oil and gas production rose 3.6% to 1.45B boe in 2014, and realized crude oil price fell 13% to 3,939 yuan/ton.
PetroChina Co Ltd is engaged in the exploration, development, production and sale of crude oil and natural gas; refining of crude oil and petroleum products, transmission of natural gas, crude oil and refined products and sale of natural gas.
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