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PetroChina says profit down 82 per cent due to low prices, 'complicated' economic situation

BEIJING, China – State-owned PetroChina Ltd., Asia’s biggest oil and gas producer, says its quarterly profit declined 82 per cent from a year earlier due to a sharp decline in oil prices.

The Beijing-based company said it earned 6.2 billion yuan ($989 million), or 0.03 yuan (0.5 cents) per share in the three months ended March 31. Total revenue fell 22 per cent to 410.3 billion yuan ($65.9 billion).

PetroChina, one of the world’s most valuable companies by market capitalization, cited a “significant drop of prices of crude oil and refined oil,” slower Chinese economic growth and a “complicated political and economic situation.”

PetroChina said it was cutting costs and some business segments did much better than the overall operation. Profit from its natural gas and pipeline unit rose 428 per cent to 7.3 billion yuan ($1.1 billion), helping to offset losses elsewhere.

A series of executives and former executives of PetroChina and its parent, China National Petroleum Corp., have been snared in a sweeping anti-corruption crackdown, though it is unclear how their operations might have been affected.

A former CNPC chairman, Jiang Jiemin, went on trial this month on charges of taking bribes and abuse of power and admitted in court he was guilty of corruption.

Also in April, a former member of the Communist Party’s ruling inner circle, Zhou Yongkang, a former party boss of the state-owned energy industry, was charged with taking bribes, abuse of power and leaking state secrets.

On Monday, the ruling party announced the general manager of rival Sinopec Ltd., Asia’s biggest refiner, had been detained in an investigation of possible discipline violation, which usually refers to corruption.

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PetroChina Ltd.: www.petrochina.com.cn