PetroChina Co., China's biggest oil conglomerate, said Wednesday that its first-half net profit surged 29 percent from the same period a year earlier as high oil prices offset an operating loss in its refining segment, AP REPORTED. PetroChina's net profit in the six months ended June 30 was 80.6 billion yuan (US$10.1 billion; ¤7.88 billion), up from 62.4 billion yuan (US$7.8 billion; ¤6.1 billion) in first-half 2005, the company said. Revenues, boosted by high oil prices, rose to 326.5 billion yuan (US$41 billion;¤32 billion) from 260.6 billion yuan (US$32.7 billion;¤25.5 billion) a year earlier. The company also announced Wednesday that it was buying a 67 percent stake in PetroKazakhstan for US$2.7 billion;¤2.1 billion) from its state-owned parent, China National Petroleum Corp. PetroChina and CNPC have signed an agreement for the deal but it requires shareholder approval, the company said at a news conference. CNPC took over Canada-based PetroKazakhstan last year for US$4.2 billion (¤3.28 billion) in China's biggest foreign acquisition, part of an effort to secure foreign energy supplies for China's booming economy. PetroChina reported a first-half operating loss for its refining and marketing segment of 13.89 billion yuan (US$1.74 billion; ¤1.36 billion) because of government controls on domestic oil-product prices. That compared with a loss of 5.95 billion yuan (US$746.5 million; ¤582.7 million) in first-half 2005. PetroChina is China's second-largest refiner by capacity after China Petroleum & Chemical Corp., or Sinopec. China has raised its gasoline and diesel prices twice this year but analysts say they remain 15 percent to 20 percent below international levels. PetroChina forecast its earnings would continue to climb in the second half of the year. The strong first-half earnings came despite a 10.3 billion yuan (US$1.3 billion; ¤1 billion) windfall profits tax the company paid due to high crude oil prices. China imposed the tax of 20 percent to 40 percent on domestic sales of oil priced above US$40 a barrel China by companies with both onshore and offshore oil operations. The company, which has shares traded in Hong Kong and New York, said the Chinese government had approved construction of three new liquefied natural gas, or LNG, terminals, to be built in Hebei and Liaoning provinces in the north and in Jiangsu province, near Shanghai. The company also said it planned to issue shares in Shanghai but did not give a timetable.
