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PetroChina 1H profit rises on increased production

August 22, 2013

HONG KONG (AP) — State-owned PetroChina’s half-year profit rose to nearly $11 billion as Asia’s biggest oil producer increased output of crude and natural gas.

The company said Thursday its results were also helped by smaller losses at its refining and chemicals business after China reformed price controls to allow domestic fuel prices to more closely follow international prices.

PetroChina said January-June profit rose 5.6 percent from a year earlier to 65.5 billion yuan ($10.7 billion). Revenue rose 5.2 percent to 1.1 trillion yuan.

Crude output grew 2.6 percent to 464.2 million barrels while natural gas production rose 8.1 percent to 1.4 trillion cubic feet.

The Beijing-based company has grown into one of the world’s biggest crude producers by outspending Western rivals to acquire reserves in places such as Canada, Iraq and Qatar. It’s also pumped as much as possible from reserves in China, estimated to contain more than 6.5 billion barrels. Almost all of the majority state-owned company’s output is for domestic use.

Chairman Zhou Jiping said there may be “some difficulties for the rebound of the domestic economy” in the second half of the year, with little chance of a “significant improvement” in the petroleum and petrochemical markets.

He said the global economy’s recovery “will remain highly uncertain,” with oil supply expected to “slightly exceed” demand and crude prices “likely to continue to fluctuate at high levels.”

PetroChina, which operates more than 20,000 gasoline service stations in China, said reforms to fuel price controls introduced in late March helped it narrow losses at its refining and chemicals business. The division’s losses fell to 15.8 billion yuan in the period from 28.9 billion yuan a year earlier.

China’s fuel price controls are aimed at keeping politically sensitive inflation in check.

Update hourly