PetroChina Scores Best Profit in 7 Years on Rising Oil Price

(Bloomberg) -- China’s biggest oil company posted its best profit since 2014 as it benefited from rising energy prices.

PetroChina Co.’s net income rose to 92 billion yuan ($14.5 billion) in 2021, more than quadrupling the level from the previous year, according to its annual earnings release. Oil and gas production rose 3.4%, while the refining business recovered from a loss in 2020 to make a 38 billion yuan operating profit last year.

Capital expenditure will be 242 billion yuan in 2022, compared to 251 billion yuan for 2021. PetroChina and other state-owned energy firms are under pressure from the government to boost output to secure energy supplies and reduce reliance on expensive imports.

Read more: China’s Oil Majors Open Their Checkbooks to Fight Fuel Scarcity

The company plans to increase output 2.8% in 2022, including a 4.6% boost in natural gas. It wants gas to account for 55% of its output by 2025, up from 52% last year. 

The oil giant faces headwinds this year as the outlook for domestic demand is clouded by the pandemic’s resurgence in China. Government-ordered lockdowns in mega-cities like Shenzhen and Shanghai have already impacted oil and gas consumption. 

Chairman Dai Houliang didn’t answer a question posed Thursday on an earnings call over whether the firm was interested in increasing stakes in Russian projects. PetroChina’s parent China National Petroleum Corp. is one of several potential buyers that BP Plc has reached out to about the planned sale of its roughly 20% stake in Russia’s Rosneft PJSC.

Read more: BP Said to Approach State-Owned Majors on Russia Assets (1)

PetroChina is also trying to navigate a path that allows it to ensure the country’s fuel needs are met in the present while remaining relevant in a decarbonized future. 

The company spent 2.2 billion yuan on new energy in 2021, according to a company report, and plans to double that amount in 2022, in part to help offset global fuel supply risks, Dai said Thursday. It wants clean energy to account for 7% of its output by 2025. 

(Updates with details throughout.)

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