The Annual Shale Gas Technology & Equipment Event
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PETROCHINA Co posted a 33 percent drop in third-quarter earnings, missing the forecast, because of falling crude oil prices and losses in natural gas imports.
Net profit fell to 24.9 billion yuan (US$4 billion) in the quarter from 37.4 billion yuan in the same period last year, China's largest oil producer said in a stock exchange filing yesterday.
Operating income from its upstream exploration and production business fell 13 percent to 49.5 billion yuan in the third quarter due to lower commodity prices.
The company also posted an operating loss of 752 million yuan in the natural gas and pipeline segment in July-September, according to Shanghai Daily calculations, due to losses in natural gas imports from central Asia and higher import prices of liquefied natural gas than domestic selling prices, which are under government control.
"This is the second consecutive quarter the natural gas segment posted an operating loss, signaling the widening of import losses as volumes ramp up," Neil Beveridge, senior analyst at Sanford C. Bernstein & Co, commented today.
The government has said it will reform pricing on gas but Beveridge said this is "unlikely to happen in a material way" until after the spring of next year.
Also, the operating loss of PetroChina's refining and chemicals division narrowed to 8.5 billion yuan in the third quarter, from a loss of 17.4 billion yuan a year earlier, thanks to two price hikes for refined oil products which improved the company's profit margins.
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