PetroChina Company Limited reported on Wednesday that its first-half net profit slid 34.5 percent over the same period last year, pushed down by fuel price caps and windfall taxes.
Net profit totaled 53.62 billion yuan (7.84 billion US dollars), while earnings per share fell by 0.17 yuan per share to 0.29 yuan, the company said in a statement to the Shanghai Stock Exchange.
Zhou Jiping, PetroChina president, attributed the profit slump to higher payments of a special tax on domestic crude oil sold at more than 40 US dollars a barrel and national ceilings on domestically refined oil products.
PetroChina paid 47.8 billion yuan in windfall taxes for selling domestically produced crude oil in the first half, nearly triple the 14.9 billion yuan paid in the same period last year.
The company witnessed losses of 59 billion yuan in the oil refining and sales sector, while almost 4 billion yuan in profit was made from this sector in the first half of last year.
The fuel price spike also eroded the first-half net profit of Sinopec, China's largest oil refiner, which reported on Sunday a 73.4 percent net profit drop to 9.34 billion yuan.
PetroChina reported government subsidies for losses in refining and selling below-cost fuel of 4.6 billion yuan in the first half.
However, overall PetroChina still performed well in the first half, said Zhou.
Crude oil output reached 435 million barrels, up 3.5 percent, while natural gas output increased 15.7 percent to 923 billion cubic feet.
The exploration and development sector remained the company's major profit maker, with a profit of 130.2 billion yuan, up 35 percent.
PetroChina said it would make exploration and development its top priority in the second half, when an estimated 85 billion yuan will be invested in this sector, compared with 47 billion yuan in the first half.
Listed in Hong Kong and Shanghai, PetroChina is the listed subsidiary of China National Petroleum Corporation (CNPC), China's largest oil and gas producer.
(Xinhua News Agency August 28, 2008)
