China National Petroleum Corp, the nation’s leadingoil and gas supplier and producer, has kept moving forward over the decades, and sees more expansion to come, according to senior executives.
They said this year marks the 40th anniversary of China’s reform and opening-up and also the 25th anniversary of the launch of CNPC’s overseas businesses. During the process, the State-owned oil giant underwent a strategic transformation and upgrading on multiple levels to grow into the world’s third-biggestoil company.
According to official statistics, the total assets of CNPC hit 4.1 trillion yuan ($592.07 billion) at the end of 2017 and its revenues stood at 2.34 trillion yuan last year, an increase of 25 percent compared with 2016. It is estimated that in the current year,the group’s brand value reached $31.2 billion, ranking it fourth among the list of Global Fortune 500 companies.
The company says the development of CNPC over the past 40 years can be summarized as a history of magnificent reform and endeavor.
China witnessed a fast-growing petroleum industry in the 1970s, with crude oil output setting a new high in 1978, topping 100 million metric tons. However, oil production declined afterwards until 1982, when the central government released several policies and measures to stimulate the industry. In 1985, China’s crude oil output came in at 125 million tons, ranking it sixth in the world.
In 1998, CNPC was reorganized to become an integrated energy group. This was the time when the Asian financial crisis broke out, leading to a sharp drop in the production and sales of petrochemicals, as well as the international oil price, which fell to its lowest level ever.
To address the situation, the central government initiated a restructuring between CNPC and China Petrochemical Corp, or Sinopec, another State-owned oil giant, which was completed in just a few months. CNPC transferred 12 of its subsidiaries to Sinopec and in return received 19 companies from the latter.
Benefiting from the initiative, CNPC expanded its business to oil and gas upstream and downstream operations, as well as oilfield services, engineering construction, equipment manufacturing, financial services and new energy developments.
CNPC executives said that one focus of the reform of the Stateowned enterprises was to establish a modern corporate system to enhance their core competitiveness, and an overseas listing was a wise choice to reach this goal.
In April of 2000, CNPC was listed on the New York Stock Exchange and the Hong Kong Stock Exchange.
Seven years later, it was listed on the Shanghai Stock Exchange.
From the start of the current century, the Chinese oil giant has poured huge resources into increasing its oil reserves, as reserves are commonly recognized as a core indicator by large international enterprises. At one point, it sustained a record for 10 consecutive years in China for having 1 billion tons of newly found proven reserves.
CNPC has also exhibited its strength in terms of its high production capacity. Since 1998, the group’s annual crude oil output has exceeded 100 million tons and the natural gas output has grown an impressive sixfold.
Over the past 40 years, CNPC has played a positive role in helping China win a bigger voice internationally and enhancing its influence in the global petroleum sector.
It has completed a series of major projects, such as the acquisition of PetroKazakhstan; the expansion of BGP, one of its subsidiaries, which is now the world’s largest geophysical service provider; and the construction of five oil and gas cooperation zones, four cross-border oil and gas supply channels and three international oil and gas operation hubs.
These efforts have enabled CNPC to gradually improve its international strategies and upgrade its global business. Its affiliated companies have also transformed from being recipients of the global oil
and gas market rules and product standards to being participants and contributors in the sector.
The report of the 19th National Congress of the Communist Party of China, released in October last year, pointed out that the nation’s economy has shifted from highspeed growth to high-quality development.
It said it was therefore important to deepen the reform of Stateowned enterprises, especially mixed-ownership reform, and to nurture world-class companies.
For CNPC, a top work priority in the future is to continue that reform and to retain and add value to State-owned assets.
One of the group’s major efforts is to continuously and more profoundly take part in the construction of the Belt and Road Initiative.
In 2017, the group had equity oil and gas production of more than 73 million tons in BRI regions, accounting for 80 percent of its total production overseas.