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, 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
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
Tue, Feb. 17, 3:31 PM
- China may merge its state-owned oil companies to create giants that will be more efficient and capable of taking on big overseas rivals, WSJ reports.
- One plan reportedly would combine the country’s largest oil companies, CNPC (PTR +2%) and Sinopec (SNP +4.2%), while other options include merging Cnooc (CEO +1.8%) with Sinochem.
- The firms have expanded into each others’ turf over the years, creating overlapping operations that span everything from exploration to refining to running gas pumps.
- No timetable is set for a decision on whether or when to proceed with the mergers, WSJ says.
Dec. 4, 2014, 2:56 PM
- PetroChina (PTR +6.4%) says it is teaming up with Sinochem (SHI +5.3%) to tap shale gas from five blocks in the southwest of China.
- The new entity plans to spend 26B yuan ($4.2B) to tap the five shale blocks, which total 15.6K sq. km in size and are mostly located near Chongqing; production is expected to begin in 2017.
- China is believed to hold the world's largest technically recoverable shale gas reserves but development is at an early stage.
Dec. 4, 2014, 6:32 AM
- The Shanghai Composite gained 4.3% overnight, bringing its advance over the past month to 19%, the most among 93 global markets. The index is now higher by 37% year-to-date.
- The rally comes not just alongside a PBOC rate cut, but as mainland stocks opened up to global investment in early November - exchange volume nearly doubled the previous 30-day average.
- Among the movers: PetroChina (NYSE:PTR) and Sinopec (NYSE:SNP) both soared by the 10% daily limit.
- FXI +3.9% premarket
- ETFs: FXI, EWH, PGJ, YINN, GXC, FXP, ASHR, YANG, MCHI, PEK, XPP, YAO, YXI, CHXF, FCA, CN, CHIE, EWHS, FCHI, ASHS, CNXT, CHNA, KBA, FHK
Sep. 17, 2014, 11:46 AM
- Sinopec (SNP -0.4%) and PetroChina (PTR +2%), China's largest oil and gas producers, plan to increase shale gas output by 40%/year to meet the country’s production target.
- SNP plans to invest 21.5B yuan ($3.5B) in shale gas drilling and expects to produce as much as 3.5B cu. meters by 2015, while PTR is targeting output of more than 2.5B cu. meters in 2015 after investing 11.2B yuan, according to the Ministry of Land and Resources.
- China’s 2015 target depends on SNP's ability to produce shale gas at the Fuling project in the country’s southwest, but the company has halved its target of producing 60B cu. meters by the end of the decade because of geological challenges.
Aug. 28, 2014, 11:15 AM
- Athabasca Oil (OTCPK:ATHOF +3.2%) jumps after PetroChina (PTR -1.9%) President Wang Dongjin says the long-delayed $1.23B payment for its stake in the Dover oil sands project will be made soon.
- PTR was supposed to have completed the acquisition in June, but delayed payment amid the Chinese government's corruption investigation into the company; PTR also was said to want to reduce the amount owed because it believed the assets are of poorer quality than expected.
Jul. 28, 2014, 10:48 AM
- Athabasca Oil (OTCPK:ATHOF -6.8%) is downgraded to Market Perform from Outperform with a $7.50 price target, down from $10, at Raymond James on growing concerns about its relationship with PetroChina (PTR -1.3%).
- The firm sees a risk regarding the anticipated C$1.23B payment from PTR, and it does not expect any improved clarity on the issue for some time.
- The risks around the Dover project put also raise concerns about the pace of development for Athasbasca’s Duvernay assets and the company’s ability to eventually secure a joint venture partner, the firm says.
Apr. 30, 2014, 2:49 PM
- Royal Dutch Shell (RDS.A +3%) is raising its stake in the proposed Canada LNG project on British Columbia's coast at Kitimat to 50% after two of the Asian partners pared their interests.
- Mitsubishi and Korea Gas had each owned 20%, and they now own 15% each, while PetroChina (PTR) maintains its 20% interest; Shell had owned 40%.
- Shell says early engineering work on the multi-billion dollar project is set to begin and would take up to two years to complete, but a final investment decision is still months away; it is partnering with TransCanada (TRP) on a proposed pipeline to carry gas to the coast.
- LNG Canada is designed to process 1.7B cf/day of gas in its first phase.
Feb. 11, 2014, 12:16 PM
- PetroChina (PTR +3.2%) shares surge after the oil and gas explorer's parent CNPC found a natural gas reserve that’s big enough to supply China’s needs for two years.
- The find in the southeastern province of Sichuan has a reserve of 440B cubic meters, of which 308B is technically recoverable, CNPC says; China consumed ~169B cubic meters of gas in 2013.
- A testing well at the site has produced as much as 1.1M cubic meters/day of natural gas.
Jan. 21, 2014, 2:59 PM
- Cnooc's (CEO -6.2%) loss apparently is Sinopec's (SNP +5.9%) gain, as the two Chinese integrated oil and gas companies move in opposite directions after Cnooc estimated oil production growth below its annual target for the third straight year.
- J.P. Morgan is surprised Cnooc has guided almost no organic growth in 2014, and thinks the company has set itself up for a difficult 2015, where 14%-18% Y/Y organic production growth would be needed to reach the low end of the 2011-15 6%-10% target; the firm recommends SNP or PetroChina (PTR +0.2%) instead for China oil exposure.
- SNP's prospects are considered rosier than Cnooc's: Its dividend yield is healthy at 5.21% vs. the 4.67% industry average, and its 9.17 P/E ratio indicates general investor expectations of higher returns in the short and medium term, if not beyond.
- Also, SNP discloses that Sinopec Group (SHI) increased its shareholding via the acquisition of ~173.25M class A shares on the secondary market as of Jan. 17.
Nov. 13, 2013, 7:13 AM| Comment!
Oct. 23, 2013, 3:45 PM
- Petrobras (PBR -2.9%) has sufficient funds to pay a 6B real ($2.75B) government fee for its share of operations at Brazil's Libra offshore oil field and won't need to request a fuel price increase to meet the obligation, president Maria das Graca Foster says.
- PBR and a consortium of four other companies - Shell (RDS.A, RDS.B), Total (TOT), CNPC (PTR) and Cnooc (CEO) won the right to explore Libra, estimated to contain 8B-12B boe, but the concession will require payment of a 15B real "signing bonus" before operations begin.
- PBR's financing capacity has come under scrutiny in recent quarters from analysts after disappointing earnings; it is expected to report Q3 earnings Friday.
Oct. 21, 2013, 2:05 PM
- Petrobras (PBR +4.9%) teams with Shell (RDS.A, RDS.B), Total (TOT), China National Petroleum (PTR) and Cnooc (CEO) to place the sole and apparently winning bid for Brazil's Libra oil field, as fierce protests outside the auction area appear to have forced the government into giving the business to the local firm.
- In the only offer made, PBR would own a 40% stake, with Shell having 20%, Total 20% and each of the Chinese companies 10%.
- The group will work with PBR, which was required to operate the block with at least a 30% stake, to produce from estimated reserves of 8B-12B barrels of recoverable resources.
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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