China National Petroleum Corporation


China National Petroleum Corporation
China National Petroleum Corporation 中国石油天然气集团公司
Type Government-owned corporation
Industry Oil & Gas
Founded Beijing, PR China (1988 (1988))
Headquarters Dongcheng District, Beijing, PR China
Area served Global (27 countries)
Key people Jiang Jiemin (President)
Wang Guoliang (CFO)
Products Oil (fuels, lubricants)
Natural Gas
Petrochemical
Oil Exploration Services
Oil Exploration Equipments
Revenue increase $165.49 billion USD (2009)[1]
Net income increase $10.27 billion USD (2009)[1]
Total assets increase $325.384 billion USD (2009)[1]
Employees 1,649,992 (2009)[1]
Subsidiaries PetroChina
Website www.cnpc.com.cn
CNPC headquarters

China National Petroleum Corporation (CNPC) (simplified Chinese: 中国石油天然气集团公司; traditional Chinese: 中國石油天然氣集團公司; pinyin: Zhōngguó Shíyóu Tiānránqì Jítuán Gōngsī)[2] is a state-owned fuel-producing corporation and the largest integrated oil and gas company in the People's Republic of China. It has its headquarters in Dongcheng District, Beijing.[3]

CNPC is the parent of PetroChina, the second highest evaluated company in the world in terms of market capitalization as of June 2010.[4]

Contents

Corporate structure

CNPC is the government-owned parent company of public-listed PetroChina, a company created on November 5, 1999 as part of the restructuring of CNPC. In the restructuring, CNPC injected into PetroChina most of the assets and liabilities of CNPC relating to its exploration and production, refining and marketing, chemicals and natural gas businesses.

CNPC and PetroChina develop overseas assets through a joint venture, CNPC Exploration & Development Company, which is 50% owned by PetroChina.

History

CNPC can be traced from the beginning as a governmental department of the PRC government. In 1949, the Chinese government formed a Fuel Industry Ministry dedicated to the management of fuel. In January 1952 a sub department of the fuel ministry was formed to manage petroleum exploration and mining, it was called the Chief Petroleum Administration Bureau. In July 1955 a new ministry was created to replace the Fuel Industry Ministry, it was called the Ministry of Petroleum. From 1955 to 1969, approximately 4 oil fields were found in 4 areas in Qinghai, Heilongjiang (Daqing oilfield), Bohai Bay and Songliao basin. CNPC was finally created in 17 September 1988 when the government decided to disband the Ministry of Petroleum and created a state owned company to handle all Petroleum activities in China.

1993 marks the beginning of CNPC international operation. CNPC sign a service contract with the government of Peru to manage the Talara oilfield. It was followed by an oil contract with the government of Sudan to manage Block 1/2/4 in the Muglad oilfield. Then in June 1997 the company bought a 60.3% stake in the Aktobe Oil Company of Kazakhstan, the next month CNPC won an oil contract for the Intercampo oilfield and East Caracoles oilfield in Venezuela.

Further In July 1998, the company was restructurized by the government in accordance with the upstream and downstream principle of oil industry.[5]

In August 2005 it was announced that CNPC agreed to buy the Alberta-headquartered PetroKazakhstan for US$4.18 billion. This would be the largest overseas acquisition by a Chinese company. The acquisition was successfully completed 26 October 2005 after a Canadian court turned down an attempt by LUKoil to block the sale.[2]. In 2006 67% of shares were sold from the parent company to PetroChina [6]

On 5 November 2007, CNPC's HK listed subsidiary PetroChina was also listed as an A share in the Shanghai Stock Exchange.

Operations

CNPC holds proved reserves of 3.7 billion barrels (590,000,000 m3) of oil equivalent. In 2007, CNPC produced 54 billion cubic metres of natural gas.[3] CNPC spun off most of its domestic assets into a separate company, PetroChina, during a restructuring. CNPC has 30 international exploration and production projects with operations in Azerbaijan, Canada, Iran, Indonesia, Myanmar, Oman, Peru, Sudan, Thailand, Turkmenistan, and Venezuela.

Iraq

CNPC began development of Ahdab, an oil field in Wasit Governorate holding a modest one billion barrels, in March 2009, becoming the first significant foreign investors in Iraq.[7] The project progressed despite security problems although CNPC encountered problems with local farmers. Dozens of farmers complain of damage to property because of work on the site and Iraqi oil officials claim thievery from the oil site by local farmers.[7] Adhab is not expected to be a major profit center, earning the company a projected 1 percent profit. Instead development of the field was seen as an entry strategy into Iraq. Following Adhab, CNPC obtained a contract to develop the much larger Rumaila field with joint venture partner BP and it is expected that crude oil production from Rumaila will expand by 10% by the end of 2010 once the BP PLC/CNPC consortium takes over development of the field in June 2010.[8][9]

Iran

CNPC has become increasingly involved in development of Iranian oil fields following Western sanctions that target the Iranian oil and gas sectors leading many European energy companies such as Shell Oil, Repsol, and etc. to shut down operations in Iran. The CNPC along with Sinopec is involved in various projects relating to Iran oil/gas development. As of 2011, CNPC is undertaking development of Iran's age-old Masjed Soleyman Oil Field, (the oldest oil field of the Middle East) in collaboration with Iranian counterpart NIOC in a deal worth 200 million dollors. Production from this particular oil field is expected to increase this year from current 2,500 barrels (400 m3) a day to 25,000 barrels (4,000 m3) after the completion of the first phase, and to 55,000,000 bbl/d (8,700,000 m3/d) following the completion of phase 2 of the project.[10]

Syria

CNPC with Indian state oil firm, ONGC created a joint venture to acquire minority stakes ranging from about 33.3% to 38% in several mature Syrian oil and natural-gas properties. The combined entity was a notable instance of cooperation between two state oil firms that regularly competed for assets around the world.[11]

Kazakhstan

CNPC is heavily involved in the development of Kazakh oil after the acquisition of Alberta-based PetroKazakhstan, a company with all operations in Kazakhstan. The company was purchased for $4.18 billion. Political resistance in Kazakhstan to the deal was placated by the sale of a minority stake in PetroKazakhstan by CNPC to KazMunaiGaz, the Kazakh state-owned oil company.

Uzbekistan

In 2006, CNPC formed an international consortium with state-run Uzbekneftegaz, LUKoil Overseas, Petronas, and Korea National Oil Corporation to explore and develop oil and gas fields in the Aral Sea.[12]

Xinjiang Pipeline

In October 2004, CNPC began construction of a pipeline from the Middle East to Xinjiang.

Accidents and incidents

Jilin Chemical Plant

In 2005, there were explosions at a CNPC owned petrochemical plant causing six deaths, a mass evacuation, and a massive oil spill over the Songhua River.

Chishui River diesel spill

In 2009 a CNPC pipeline burst, spilling 150 m3 (5,300 cu ft) of diesel oil into the Chishui River in Shaanxi province.[13]

Xingang Port oil spill

In July, 2010, two pipelines exploded at an oil storage depot belonging to China National Petroleum Corp near Dalian's Xingang Harbour in Liaoning province which spilled an estimated 1,500 tonnes of crude into the sea. The worst of the spill initially covered 180 km2 (69 sq mi).[14][15]

See also


References

  1. ^ a b c d "Fortune Global 500 2007: China National Petroleum Corporation", Fortune.
  2. ^ A common shortname for the corporation in Chinese, Zhongguo Shiyou (中国石油), formerly shared the same name as the Chinese Petroleum Corporation, the Republic of China (Taiwan)'s state-owned fuel corporation.
  3. ^ "Contact Us." China National Petroleum Corporation. Retrieved on July 8, 2010.
  4. ^ "Global 500 June 2010". The Financial Times. 30 June 2010. http://media.ft.com/cms/620e79e8-8837-11df-a4e7-00144feabdc0.pdf. Retrieved 1 August 2010. 
  5. ^ History of CNPC, CNPC website.
  6. ^ PetroChina to acquire 67% interests in PetroKazakhstan
  7. ^ a b "China Faces Unexpected Problem Drilling for Oil in Iraq -- Farmers" The Wall Street Journal
  8. ^ Williams, Timothy (2009-09-06). "China Oil Deal Is New Source of Strife Among Iraqis". The New York Times. http://www.nytimes.com/2009/09/06/world/middleeast/06iraqoil.html?pagewanted=2&_r=1&em. Retrieved 2010-04-28. 
  9. ^ "CNPC: To Raise Iraq Rumaila Oilfield Output 10% By Year-End" The Wall Street Journal[1]
  10. ^ "Increase of Iranian Oil Production". JameJam Online. 2011-04-29. http://www.jamejamonline.ir/newstext.aspx?newsnum=100842196444. Retrieved 2011-04-29. 
  11. ^ "India, China Win On Venture's Bid For Syria Oil Stake " The Wall Street Journal
  12. ^ Uzbekistan, intl consortium ink deal on exploring Aral Sea ITAR-Tass
  13. ^ Mu Xeuquan (5 January 2010). "Diesel spill contaminates Yellow River tributaries". Xinhua News. http://news.xinhuanet.com/english/2010-01/05/content_12754632.htm. Retrieved 19 July 2010. 
  14. ^ Agence France-Presse (Monday, 19 July 2010). "China rushes to clean up oil spill". Yahoo! News. http://news.yahoo.com/s/afp/20100719/wl_asia_afp/chinaenvironmentoilpollution. Retrieved 20 July 2010. [dead link]
  15. ^ "China Port Reopens After Oil Spill, Cleanup Continues". Voice of America News. Tuesday, 20 July 2010. http://www1.voanews.com/english/news/asia/China-Port-Reopens-After-Oil-Spill-Cleanup-Continues-98853794.html. Retrieved 19 July 2010. 

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