Cnooc’s Profit Growth to Surpass Exxon, Shell on Output, Prices
Cnooc Ltd.’s first-half profit growth may be double that of Exxon Mobil Corp. and Royal Dutch Shell Plc after China’s third-largest oil company increased its crude reserves and output amid record prices.
Net income probably climbed 52 percent to 22.1 billion yuan ($3.2 billion), according to the median estimate of five analysts surveyed by Bloomberg News. Cnooc avoided the likely slump in profits at PetroChina Co. and China Petroleum & Chemical Corp. caused by government caps on fuel prices because it doesn’t run refineries, Gordon Kwan, an analyst at CLSA Ltd., said.
Cnooc relied on discoveries and production at home to benefit from a 46 percent increase in crude oil prices in the first six months, while its overseas competitors struggled to boost output as countries from Kazakhstan to Venezuela cut access to oil. PetroChina and Sinopec, as China Petroleum is known, have been prevented from passing on crude oil costs to consumers.
Cnooc has benefited “thanks to surging crude oil prices and the lack of exposure to China’s depressed downstream fuel market,” said Kwan, CLSA’s Hong Kong-based head of China energy research. “The second half should improve further on the back of still high oil prices and the start-ups of numerous oil and gas fields in Bohai Bay.”
The Beijing-based exploration company plans to increase crude oil and natural gas output by as much as 18 percent this year as economic growth spurs energy demand, Cnooc said on Jan. 29. Cnooc announced the start-up of two oil fields and two discoveries in the first half.
Exxon, PetroChina
Exxon’s net income climbed 16 percent in the first six months while Shell’s profit climbed 29 percent, according to data compiled by Bloomberg.
PetroChina, Asia’s biggest oil company, may post a 34 percent drop in profit to 54 billion yuan and earnings at Sinopec probably fell 81 percent to 7 billion yuan, according to the median estimates of seven analysts.
Sinopec is due to release earnings between Aug. 22 and Aug. 25 while Cnooc and PetroChina are scheduled to report on Aug. 27.
Cnooc’s earnings have outperformed those of its Chinese rivals because the offshore oil producer derives about 90 percent of its revenue from exploration compared with almost 11 percent at PetroChina and less than 2 percent at Sinopec.
China’s refineries are still losing money even though the government raised gasoline and diesel prices by at least 17 percent in June, China National Petroleum Corp., the parent company of PetroChina, said on June 28.
Tags: Fuel, PetroChina, Petroleum, Shell, SinopecPages: 1 2
