Historic Breakthrough in CNPC＇s Overseas Oil and Gas Operation

Daily overseas oil production tops 80,000tons.China National Oil and Gas Exploration and Development Corporation (CNODC), one of the subsidiaries under CNPC specialized in oversea soil and gas exploration, is now experiencing a strong and rapid business development momentum this year. On August 6, CNODC announced the daily overseas oil production started to top 80,000 tons from July by reaching 82,400 tons, a substantial step towards the company‘s annual target of 30 million tons. With a total of 44 oil and gas exploration and development projects currently under execution worldwide, CNODC has been committed to enable the overseas operation to become the new growth point for CNPC.     

Latest Development of China＇s Offshore Oil Giant

China National Offshore Oil Corporation （CNOOC）, the country＇s largest offshore oil and natural gas producer, has remained ambitious and active in its business development both inside and outside China. It has made remarkable achievements in 2013 with a promising prospect in the rest of the year.     

Latest Development in China＇s Oil Refining ＆ Petrochemical Sector

China＇s big-three oil companies - CNPC, Sinopec and CNOOC - have intensified their competition in the domestic oil refining and petrochemical sector in recent years so as to better position themselves in the oil products market at home.     

Key Economic Indexes of China‘s Three Oil Giants in 2001

Based on the statistical figures provided by CNPC,Sinopec and CNOOC, three oil giants in the countryCNPC generated 430.1 billion yuan for the salesincome, 53 billion yuan for the profits and 64.8billion yuan for the taxes in 2001. Sinopec generated360 billion yuan for the sales income, 12.81 billionyuan for the profits and 34.19 billion yuan for thetaxes. CNOOC generated 30.38 billion yuan for thesales income and 9.6 billion yuan for the profits.All the three companies saw a stable grow…     

Development of China＇s Offshore Oil Resources

Compared with the traditional exploitation of landbased oil and gas, to explore offshore oil and gas might exert certain influences by high-risk, high-tech and high-investment, which attributes to determine the basic characteristics of offshore oil and gas developmentsafe, efficiency and economy. China National Offshore Oil Corporation （CNOOC） as the largest producer of offshore oil and gas in China, through 26 years rapid development with experiences three stages that are external cooperation, combination of cooperative and selfoperation, and fully integrated energy company, to further clarify the developing target of the company.     

Panorama of China＇s Oil Refining Industry in 2005

China＇s oil refining industry registered a loss of about 30 billion yuan （US$3,7 billion） in 2005, a sharp contrast to the 20.8 billion yuan in profits in 2004, according to the statistical figures made available from China＇s National Development and Reform Commission （NDRC）, which is in charge of industrial policy. The development of China＇s oil refining industry has witnessed tension between oil demand and straining supply as well as a steady increase of output in 2005, impacted by domestic and international factors.     

Dynamic Development of China＇s Offshore Oil Giant

China National Offshore Oil Company Limited(CNOOC Ltd.) saw its daily net production of oil and natural gas rose 15 percent year on year to 566,860 barrels of oil equivalent in the first quarter. However,the company's total unaudited revenue dropped 41.9 percent to 13.95 billion yuan (US$2.1 billion) on lower crude prices in the first three months this year. Based on the 2009 ranking of Global Top 500 released by British Financial Times on May 29, CNOOC, which is the parent company of CNOOC Ltd., moved up to the 80th place from the 101st place in 2008.     

International Cooperation of China’s Petroleum Industry

With the rapid development of the economic globalization, the international operation of petroleum industry has become a strategic instrument commonly adopted by the global petroleum corporations. Since the early 1990s, China＇s petroleum industry has participated in international cooperation at an earlier time and vigorously carried out transnational management. Among them, China National Petroleum Corporation （CNPC） has gained an initial scale in overseas oil and gas production and supply and gained tremendous economic and social returns through constant exploration and accumulated experience, taking the lead among the large corporations in China.     

Developing Course and New Strategy of ZPEB＇s Overseas Projects

Zhongyuan Petroleum Exploration Bureau （ZPEB） is one of the enterprises that stepped into international oil markets prior from China. In 1992, the project contracted for No.55 highway construction in Pakistan with ZPEB, which was the prelude of entering international market. In 1996, the seismic team No.96168 went to Sudan for the first time; in 2000, No.5012 drilling crew entered Qatar for the purpose of knocking the door of petroleum engineering service in Middle East market. ZPEB exploited in the positive exploring for overcoming many difficulties during the operations and made its overseas projects have been developed gradually.     

Review and Outlook of China＇s Oil Market in 2013

The growth rate of China＇s oil demand dropped considerably in the first half of 2013, and that ofoil products demand varied a lot. The growth rate of domestic crude oil output, processed crude oil and product oil output rose again. Both net imports and dependence of crude oil and oil on foreign trade declined. Exports of gasoline, kerosene and diesel grew on a large scale. Basically the State timely adjusted domestic product oil prices according to the new pricing mechanism and ensured rich supply.     

China's Demand for Overseas Crude to Expand

China＇s dependency on foreign crude will continue to increase this year despite the ongoing strife in major oil-producing nations like lraq. According to a report publishcd by China National Petroleum Corporation （CNPC）, the country＇s largest oil and gas produce,; China is expected to import 298 million metric tons of crude this year, accounting for about 58.66 percent of the total crude consumption in the country.     

China＇s Crude Oil Production from 2008 to 2013 （10,000 tons）

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Way to Success： International M＆A of China Oil Enterprises

Significance of international mergers and acquisition
Good for easing lack of domestic oil reserves
China oil production is under severe deficit due to insufficient resources. Annual average growth rate of crude oil consumption was 7.41%, but annual average growth rate of crude oil supply was only 1.95% in China in past 10 years. Oil supply could not meet demand of economic development. It is predicted that degree of China＇s dependence on foreign will be as high as 60% in 2015.