Edited from: 'Chairman's letter, annual report
PetroChina made its “best efforts” to organize its resources with a view to achieving a stronger balance of production, transportation and sales, maximize the supply of oil and chemical products to the market, and ensure safe and steady gas supply.
It will continue to:
(1) improve oil and gas exploration and exploitation;
(2) speed up its reserve and production capabilities;
(3) accelerate the adjustment and optimisation of its refining and chemicals businesses;
(4) further improve its competitiveness and profitability;
(5) intensify its marketing efforts;
(6) improve operating efficiency;
(7) accelerate the development of its overseas business; and
(8) secure as much overseas resources as possible.
Looking ahead, PetroChina believes that China may be able to maintain high economic growth and low inflation. The rapid development of the national economy will increase the market demand for oil and petrochemicals and provide ample room for development for the oil and petrochemical industries.
However, the implementation of macroeconomic control measures and the Chinese government’s general policy to establish a ‘frugal society’ in an attempt to achieve scientific development for China will lower the demand for energy effectively and slow down the growth of demand for oil and gas. It is expected that China will adopt more stringent land and environmental protection policies and enhance law enforcement and regulation. China will also carry out reforms in the oil and gas pricing mechanism, energy tax and the exchange rate mechanism at a proper time.
The company will ‘operate in complicated and ever changing circumstances and face more fierce competition’. As such, the company needs to react in a positive manner, carry out a steady operation, emphasise the implementation of the strategies of resources, market orientation and internationalisation and gain initiatives in development efforts.
It will continue to strengthen its exploration and development businesses in China and further consolidate its resources foundation. PetroChina will focus on realising stable development in eastern China and rapid development in western China. The company will insist on placing equal emphasis on oil and gas businesses. It will continue to give priority to oil and gas exploration and ‘perfect’ its oilfield development efforts in order to ensure steady and increased crude oil production, rapid increase in natural gas production, and accelerate the establishment of a larger scale, enhanced supply and safer natural gas production base.
The company will also continue to promote the construction of key refining facilities to improve the competitiveness and profitability of the refining segment. The refining business structure will be optimised and the efficiency of the marketing network will be improved in order to accelerate the pursuit of economies of scale for leading products.
In the chemicals business, the company will insist on making optimised arrangements, enhancing development of leading new products, developing high quality and high value added products, and improving the competitiveness of leading products.
The company will continue to speed up construction of infrastructure for oil and gas storage and transportation, perfect gas transmission pipelines and networks, construct interconnection lines linking up main gas transmission lines such as the West-East gas pipeline project and the second Shaanxi-Beijing pipeline, construct a gas transmission network in eastern and western China, speed up the construction of compressor stations and underground storage in order to ensure safe and steady supply in the market.
The company will continue to expand its international businesses and enlarge the scale of its overseas oil and gas production. Building on its existing oil and gas projects, the company will lay stress on key areas and regions, enhance oil and gas exploration and exploitation, and strongly promote the rapid development of its overseas businesses.
In the international trade, PetroChina has to proactively diversify the sources of import of resources, make arrangements to facilitate the import of crude oil from foreign countries such as Russia and Kazakhstan, develop sour and heavy crude oil sources and make preparations for the planned introduction of natural gas, LNG and other resources into China.
In addition, PetroChina's management will persist in enhancing the company's value and strive to maximise the benefit and value for its shareholders. The company will make substantial efforts in technological and management innovation, further strengthen its internal control mechanism and monitoring system which comply with regulatory requirements in the market. This it hopes will promote the continuous, effective and relatively speedy development of the company into the future.
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Financial highlights: PetroChina, year ended 31 December
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PetroChina engages in a wide range of activities related to oil and natural gas. PetroChina was established on 5 November 1999 as a subsidiary of the China National Petroleum Corporation (CNPC). Restructuring the business, CNPC injected most of its assets and liabilities relating to its exploration and production, refining and marketing, chemical and natural gas businesses into PetroChina.
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