Winners and losers from Chinese pricing reform [Gas in Transition]
Winners and losers from Chinese pricing reform [Gas in Transition]
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Natural Gas News
Winners and losers from Chinese pricing reform [Gas in Transition]
Summary
China has made progress on gas pricing reforms, with a linkage between upstream costs and end-user tariffs finally in place, but certain players along the gas value chain are reaping the benefits more than others. [Gas in Transition, Volume 3, Issue 11] by: Shi Weijun
Government reforms to how China prices gas earlier this year helped PetroChina – the country’s biggest upstream supplier – rake in record net profit over the summer, but downstream gas companies are concerned that lagging implementation of some of the reforms could squeeze their bottom lines again this winter. PetroChina reported bumper earnings growth for the July-September quarter, leading smaller domestic peers Sinopec and CNOOC as it reported a 21% year/year jump in net profit to a record 46.4bn ($6.5bn). PetroChina’s net profit compared favourably with 17.9bn yuan at Sinopec, the second-largest onshore gas producer in China, and 33.9bn yuan at offshore-focused CNOOC for the same period. The bonanza came despite a 4.6% yr/yr drop in PetroChina’s revenue to 802bn yuan. The NOC expanded domestic gas production by 5% to 1,096bn ft³, which was faster than a 3% increase in domestic and foreign oil output...
Related Knowledge Center: Climate economics
Climate change is now a driver of the world’s economy. The impact is profound:
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