PetroChina Co. posted record earnings with rise in operating profit for the first half of the year. This high earnings is a result of high drilling output and strong oil prices helped by weather weakening fuel demand in China. China’s largest oil and gas driller said output rose to 905.5 million barrels of oil equivalent in the period. Beijing has pushed its state-owned oil giants to invest heavily in production to help the nation meet energy security goals.
PetroChina financial earnings results
During its earnings result, PetroChina Co. posted a net income of 88.61 billion yuan ($12.44 billion) for the six months through June, climbing 3.9% compared to the same period last year. The company’s total revenue climbed 5% to 1.554 trillion yuan for the earnings reporting period.
“This was primarily due to the Group’s increase in the sales price of crude oil and gasoline, the sales volume of natural gas and sales volume and price of kerosene, polyethylene and other products,” PetroChina said in its filing released late Monday.
Rise in oil price increased PetroChina’s profit
The company’s directors noted the strength of international crude oil prices, and that demand in the domestic natural gas market “continued to grow rapidly.”
An uptick in oil prices helped make those investments pay off. Global benchmark Brent averaged more than $83 a barrel in the first half, compared with about $80 over the same period in 2023. PetroChina also announced a 6 billion yuan ($842 million) acquisition of its parent company’s electricity unit as it seeks to jump start its clean energy transition.
PetroChina’s oil and natural gas equivalent output climbed to 905.5 million barrels, compared to 893.8 million barrels last year.
PetroChina’s breakthroughs
The company said it “actively promoted” the development of new projects and focused on its exploration and development of oil and gas reserves, allowing it to achieve “multiple major breakthroughs” and discoveries in several basins, including the Tarim, Sichuan and Junggar basins.
The boost from upstream activities helped offset a weaker fuel market, which was hit by China’s sputtering economy and growing electrification of the transport fleet. Crude refining is one of China’s worst-performing industries, according to the statistics bureau, with accumulated losses in the first half stretching to 16 billion yuan.
PetroChina’s acquisitions
The company also announced the acquisition of 100% of CNPC Electric Energy from another unit at its parent company, state-owned China National Petroleum Corp. The acquisition will allow the company to improve its power trading business and scale up its green development strategy, it said in a statement.
PetroChina said earlier this year that it planned to add 30 gigawatts of renewable generation to its portfolio in 2024 and advanced a pledge to power its operations with 100% clean energy to 2033, 17 years earlier than previously promised.
PetroChina’s stock update
PetroChina’s share price was ¥ 9.25 up 2.21%today at closing. Hong Kong listed PetroChina’s shares as being up 35% year-to-date.
PetroChina said it would pay 0.22 yuan per share for the interim dividend. Morgan Stanley has upgraded the PetroChina to overweight earlier this month due to sustainable high yields and structural growth in gas.
