PetroChina Profits Surge to Record on Rebound in Gas Demand

(Bloomberg) -- PetroChina Co.’s annual profits rose to a record as a rebound in natural gas demand helped the Chinese energy major offset the impact of falling oil prices. 

The country’s biggest oil and gas producer’s net income rose to 161 billion yuan ($22 billion) last year, the company said in an exchange filing Monday. It posted 149 billion yuan in profits in 2022, a record at the time.

The state-owned company was buoyed by China’s exit from pandemic lockdowns, as fuel demand rebounded on increased travel and factories returning to more normal operations. Natural gas consumption rose 7.6% last year after falling in 2022 for the first time in decades, a boon for PetroChina, which supplies the vast majority of the nation’s gas.

The rebound in gas demand was aided by government policies that allowed regulated prices to increase. The company’s gas unit made 43 billion yuan in profits in 2023, up from 13 billion in 2022.

That jump was more than enough to balance out smaller profits from drilling, which was hit by a 17% year-on-year decline in oil prices, and refining. 

PetroChina and its peers Sinopec and Cnooc Ltd. have been under pressure from Beijing to maintain oil output and boost gas production to keep the country from becoming too dependent on imported energy. PetroChina boosted total oil and gas production by 4.4%, and plans another modest increase this year. 

The company budgeted 258 billion yuan for capital expenditures this year, after spending 275 billion yuan last year. 

(Updates with additional details from paragraph 5.)

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