PetroChina Q1 net profits drop 82% to CNY6.15bn

SINGAPORE (ICIS)–PetroChina’s net profit in the first quarter of 2015 contracted by a steep 82% on year to yuan (CNY) 6.15bn, with operating profits down by 73.4% to CNY13.9bn, the company said on Tuesday.

The fall in profit was mainly caused by sharp decline in crude prices and weak demand of oil and gas in China domestic market, it said in a statement.

In upstream, the company’s oil and gas production increased 4.9% on year to 381m barrels of oil equivalent (boe) in the first quarter.

Its average realised oil price was $48.87/bbl in the three month period, down by 51.2% year on year, while that of natural gas decreased by 0.8% to $6.14/thousand cubic feet.

Its exploration business, the biggest profit contributor, posted a 67.2% decline on operating profits to CNY17.3bn in the first quarter.

In midstream, PetroChina processed 253.5m barrels of oil in the first quarter, dropping by 0.4% year on year.

Its total outputs of refined products (gasoline, diesel and kerosene) also decreased by 0.4% to 23.3m tonnes.

However, productions of ethylene grew by 7.9% to 1.3m tonnes and that of synthetic resins was up by 12.3% to 2.1m tonnes.

Its refining business registered a CNY3.8bn of operating loss in January-March, reversing an operating profit of CNY2bn in the prior year. Operating loss of its chemical business narrowed to CNY1.3bn from CNY4.2bn in one-year ago.

In downstream, its sales of refined products totaled 37.7m tonnes in January-March, up by 10.4% on year. Its sales segment posted an operating loss of CNY2.6bn in the first quarter, comparing  with a profit of CNY3.3bn in the same period of 2014.

Natural gas and pipeline business showed strong results. This segment’s operating profits expanded by over four times to CNY7.4bn in the first three months.

The company said that it will try hard to cut spending and increase revenue in the next quarter.