In decades since embracing reform and opening-up, petroleum firm has gone global and expanded its scope, Li Xiaosong reports.

  In the four decades since it embraced reform and opening-up, China National Petroleum Corporation has gone through a change from “bringing in” to “going global” and expanded its business scope from offshoreonly to both onshore and offshore operations, as well as improving its technology in downstream refining.

  A new chapter of international operation has opened since 1993 — the year when CNPC won a concession in northern Peru. It then won a great number of biddings in countries such as Papua New Guinea, Sudan, Venezuela and Kazakhstan, and has also become a major player in providing technical services and engaging in international trade.

  Since the launch of the Belt and Road Initiative, CNPC has moved toward becoming a full-ranging business provider by leaps and bounds.

  It now operates in five overseas oil and gas cooperation regions, four cross-border oil and gas channels and three overseas oil and gas operation centers, marking a new phase of overseas business.

  In 2017, the full-year equity production of CNPC was 89.08 million tons, demonstrating the company’s profitability despite the downward trend of global oil price. In addition to ensuring energy security and petroleum supply, CNPC is working hard to be a world-leading energy corporation, evidenced by the following major events.

  Major events: 1978-2018

  1. CNPC takes the first step in international cooperation

  For offshore oil cooperation, China’s Ministry of Petroleum Industry signed a batch of contracts on May 29, 1980, with French and Japanese companies for oil exploration, development and production in parts of Bohai Sea, Beibu Gulf and Yubei oilfield.

  For onshore oil cooperation, CNPC Hainan branch signed a contract with Australian company CSR Sugar on May 28, 1985.

  These contracts got the ball rolling on oil cooperation at bilateral levels.

  2. Onshore oil cooperation has achieved fruitful results. CNPC has worked with foreign partners since 1985. During the past 30-plus years, some 77 contracts with 49 oil companies in 12 countries and regions have been signed, which brought in foreign investment valued at 110 billion

  yuan ($15.84 billion) and generated more than 20 billion yuan in profit.

  As of 2017, CNPC has managed 35 projects and the full-year barrel of oil equivalent of 9.86 million tons.

  3. Projects of onshore oil cooperation saw solid progress

  Three glaring projects are China’s first million-ton shallow-sea oilfield — Zhao Dong oil Project; the largest-scale international cooperation project for onshore natural gas development — Changbei Natural Gas Project; the first onshore natural gas cooperation project — Chuanzhong

  Natural Gas project.

  Operating under an CNPC-Shell Group agreement, Changbei Natural Gas Project has sustained a stable production of more than 3.5 billion cubic meters for nine consecutive years, acting as a main supplier.

  4. Overseas oil and gas resources cooperation has been smooth in last 25 years The number of overseas oil and gas cooperation regions increased to five — Central Asia-Russia, the Middle East, Africa, America and the Asia-Pacific — which stole the world spotlight.

  In 2017, the full-year operating production in these regions reached 162.74 million tons of oil equivalent, a year-on-year increase of 17.2 percent.

  5. Four cross-border oil and gas channels were set up.

  In 2003, the company’s four crossborder oil and gas channels enabling imports and exports — from northwest, northeast, southwest and offshore — got underway. CNPC to date has formed the initial network of oil and gas supply.

  Kazakhstan-China Crude Pipeline: Taking off in May 2006, it has been working as China’s first direct oil import pipeline allowing oil imports from Central Asia.

  Central Asia-China Gas Pipeline: It is the first pipeline to bring Central Asian natural gas to China. There are four cross-border lines — A, B, C and D — and one line running through the territory of Kazakhstan. As of 2017, the total volume of gas delivered to China via this pipeline reached 200 billion cubic meters, benefiting more than 300 million people.

  Russia-China Crude Pipeline (eastern section): It began operations on Jan 1, 2011, and its sideline went operational on Jan 1, 2018.

  Russia-China Gas Pipeline (eastern section): Its part in Russia starts at Yakutsk.

  Its part in China starts at Heihe city in Heilongjiang province, and ends at Shanghai. Phase I was halfdone by the end of August and is due to become operational in December 2019.

  Myanmar-China Oil and Gas Pipeline: Consisting of one crude pipeline and one gas pipeline, it started construction in June 2010 and was put into use in April 2017. It is regarded as an important accomplishment of China-Myanmar cooperation.

  6. Three overseas oil and gas operation centers were completed.

  CNPC announced the start of building an overseas oil and gas operation center in 2008, offering a portfolio of trading, processing, warehousing and transporting. Three locations in Singapore, London and Huston, Texas, the United States were built in 2009, making CNPC’s presence felt

  in Asia, Europe and America, generated 470 million tons in trade volume worth $172.6 billion.

  7. Three key projects for overseas cooperation and development were launched in 1997

  Block 1/2/4 in Sudan

  In November 1996, outbidding a dozen international oil companies, CNPC won the contract to develop Block 1/2/4 in Muglad Basin, Sudan.

  To jumpstart the project, in March 1997, CNPC and its partners formed a joint operating company – the Greater Nile Petroleum Operating Company (GNPOC).

  Aktobe project in Kazakhstan

  In 1997, CNPC won the bidding for concession in Aktobe and opened China National Petroleum Corp Aktobe Munai Gas, known as CNPC AMG in 2000.

  Oil blocks in Venezuela

  In June 1997, CNPC won tenders for the Intercampo Oilfield and the Caracoles Oilfield, located on Maracaibo Lake and the East Venezuela Basin, respectively. At the end of 2000, the daily output of crude oil increased to eight times that in the beginning.

  8. The “three firsts” of overseas cooperation in Sudan

  First 10-million-ton oilfield in Sudan and across the world

  Block 1/2/4 I Sudan achieved an annual production of 10 million tons in December 2000.

  First long-distance crude oil pipeline in Sudan This pipeline started its construction from May 1998 and was put into use in August 1999, enabling crude oil to reach Port Sudan in the north.

  First joint refinery with foreign capital

  This refinery started its construction from May 1998 and was put into operation in May 2000. It was deemed by leaders of China and Sudan as a model of China-Sudan cooperation.

  9. China’s largest overseas takeover transaction took place

  China National Petroleum Corp. bought PetroKazakhstan Inc. (PK) for $4.18 billion in October 2005 – the largest and first overseas acquisition by a Chinese company, and the second largest acquisition case around the globe in 2005.

  10. CNPC has been actively and productively involved in the Belt and Road Initiative

  The cooperation between CNPC and countries along the Belt and Road routes was fruitful and a range of cooperation agreements were signed with the governments and energy companies of Russia, Kazakhstan and Abu Dhabi, among others.

  In Central Asia-Russia, Yamal LNG Project became operational. The construction of the Eastern Route of the Russia-China Gas Pipeline was in full swing; Kazakhstan and Turkmenistan celebrated the 20th and 10th anniversaries of oil and gas cooperation with CNPC, respectively.

  In the Middle East, the North Azadegan Project and the Halfaya Project Phase II in Iraq went on stream successfully. CNPC acquired an 8 percent interest in the ADCO onshore concession under an agreement with Abu Dhabi National Oil Company (ADNOC).

  In the Asia Pacific region, the Myanmar-China Oil and Gas Pipelines were built and put into operation successively.

  11. CNPC organized the Belt and Road Roundtable for Oil and Gas Cooperation

  On May 16, 2017, the Belt and Road Roundtable for Oil and Gas Cooperation was held at CNPC headquarters in Beijing. More than 20 officials and executives in the energy sector compared notes on the building of a new model and new mechanism of BRI oil and gas cooperation and shared visions, reaching a broad consensus.

  12. Undersea combustible ice (natural gas hydrate) was successfully extracted

  CNPC launched a pilot project to search for natural gas hydrates in Shenhu, South China Sea and made this trial mining a success story in May 2017, setting the record for the longest drilling time and the highest drilling volume. Combustible ice since then was listed as China’s 173rd mineral variety. CNPC won applause from the government as a result of its hard work on this project.


  By Li Zhiqiang

  Central State-owned enterprises have undertaken a total of 3,116 projects involved in the Belt and Road Initiative with 50 percent of them are under construction, accounting for more than 70 percent of total trade contracts.

  That’s according to the latest data from the central authorities.

  The information came after a briefing presided overby the State-owned Assets Supervision and Administration Commission of the StateCouncil in mid-November.

  The central State-owned enterprises have taken part in many pilot projects in fields such as infrastructure construction and energy resource exploration, said Weng Jieming, deputy director of the SASAC.

  The state-owned enterprises have insisted on solid credit management and localized development and play a role in the fields of environment protection, the establishment of public welfare, better local people’s livelihoods and cultural communications, he said.

  To date, 85 percent of these enterprises’ overseas branches’staff are local employees and most of enterprises have reached local staffing levels of over 90 percent.

  Official data showed that by the end of 2017, there were10,791 overseas branches of State-owned enterprises in 185 countries and regions.

  These had an estimated 7 trillion yuan ($1.03 trillion) in its overseas assets, and last year annual revenue was 4.7 trillion yuan with 106.4 billion yuan in total profit.

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