Thu, Sep. 24, 8:11 AM
- China's government reportedly plans to create a new crude oil and liquefied natural gas pipeline transportation company by stripping these operations from its three largest oil firms, China National Offshore Oil (NYSE:CEO), China National Petroleum (NYSE:PTR) and Sinopec (NYSE:SNP).
- The move is said to be aimed at reducing the firms' monopoly in the oil and gas market and improving competition; for example, CNPC's PetroChina arm controls more than 80% of China's natural gas grid.
- The report from state-backed China Securities Journal says the plan has been set and is now being studied and implemented in steps.
Wed, Sep. 16, 9:21 PM
- Australia’s antitrust regulator again defers a decision on Royal Dutch Shell's (RDS.A, RDS.B) planned takeover of BG Group (OTCPK:BRGXF, OTCQX:BRGYY), this time until Nov. 12, warning the deal could raise prices and cut the supply of natural gas to consumers on the east coast of Australia.
- The Australian Competition and Consumer Commission says its preliminary view is that the deal could decrease the incentive for Shell’s Arrow Energy joint venture with PetroChina (NYSE:PTR) to supply gas domestically, which could substantially reduce competition in Queensland state or the eastern Australian gas market.
- The European Commission approved the deal earlier this month but approvals from Australia and Chinese authorities remain pending.
Mon, Sep. 14, 11:58 AM
- China National Petroleum, parent of listed PetroChina (PTR -1.4%), is promises to sell several non-core businesses, including a chain of hotels and a taxi business, as state-owned companies come under pressure from the government to dispose of lucrative but often corrupt enterprises.
- China’s two-year, anti-corruption drive has targeted the perks of office of government and state-owned enterprise employees, especially at CNPC, a former power base for now-disgraced energy and security czar Zhou Yongkang.
- Also over the weekend, state oil company Cnooc (CEO -0.7%) pledged to "dismantle all entertainment equipment” and ban official receptions, dining and purchases of high-end consumer goods.
Thu, Aug. 27, 8:19 AM
- PetroChina (NYSE:PTR) says its H1 net profit fell 63% Y/Y to 25.4B yuan ($3.97B) from 68.1B yuan in H1 2014, with earnings upstream and in the marketing segment both hurt by lower oil prices.
- PTR's H1 operating profits at its E&P segment fell 68% to 32.9B yuan, as total crude oil output rose 2.6% to 477.5M barrels.
- Total H1 oil and gas production rose 2.9% to 735.9M boe, led by a 40% Y/Y increase in overseas output, but domestic crude production fell 1.8% to 402.1M barrels.
- H1 sales fell 24% Y/Y to 878B yuan, and capital spending dropped 33% to 61.7B yuan.
- PTR says low crude prices provide an opportunity for acquisitions, and that it has been "tracking some assets for a while."
Tue, Aug. 4, 7:15 PM
- The first oil from a long-duration output test in Brazil's giant Libra offshore area now is projected to flow in Q1 2017 instead of H2 2016, says Odebrecht Oil & Gas, which will operate the test platform with Teekay Offshore Partners (NYSE:TOO).
- The later startup date could be one the first signs that Petrobras (NYSE:PBR), which manages exploration in Libra, may be having trouble meeting targets in its $130B 2015-19 strategic plan.
- PBR owns a 40% stake in E&P rights to Libra, one of the largest oil discoveries of the past three decades; Total (NYSE:TOT) owns 20%, Royal Dutch Shell (RDS.A RDS.B) 20%, and 10% each for Chinese state oil companies Cnooc (NYSE:CEO) and China National Petroleum (NYSE:PTR).
Tue, Aug. 4, 8:57 AM
- PetroChina (NYSE:PTR) yesterday won dismissal of a securities fraud lawsuit by investors who accused the company of failing to disclose corruption that exposed it to government investigations and penalties.
- The U.S. District Judge in Manhattan dismissed the case, agreeing with PTR that the investors failed to make a plausible argument that the oil and gas producer’s annual reports contained statements that were false or misleading at the time they were made.
- The investors sued PTR and some of its former and current officers in 2013, after officials at the firm became entangled in China’s crackdown on corruption.
Mon, Aug. 3, 12:24 PM
- PetroChina (PTR -2.3%) has turned into a speculative bet on how much money the Chinese government is plowing into the stock market that day, resulting in a surge in volatility to the highest level among the world’s 100 biggest companies and topping 95% of the stocks in the Russell 2000 index, according to a Bloomberg analysis.
- PTR’s top weighting in the benchmark Shanghai Composite Index makes it an ideal target for funds trying to influence the broader market, the report says.
- PTR shares have shed 25% in the past three months, while Sinopec (SNP -1.5%) and Cnooc (CEO -1.2%) have lost a respective 22% and 29% during the period.
Wed, Jul. 22, 8:55 AM
- ConocoPhillips (NYSE:COP) says it has ended talks with PetroChina (NYSE:PTR) on a shale gas development in the country after a two-year study.
- COP signed an agreement with the Chinese company to evaluate shale potential in the Neijiang-Dazu field in the Sichuan basin in early 2013.
- "Given the complicated shale formations in China, only the state-owned Chinese energy firms are more likely to pursue their investment in the sector" in the current low oil price environment, says a strategy director at ICIS China.
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."
PTR vs. ETF Alternatives
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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