Sinopec’s net income rose to $4.95 billion – this news came when the company in accordance with International Financial Reporting Standards (“IFRS”) filed its report on its turnover, other operating revenues and other incomes. Asia’s biggest refiner, China Petroleum & Chemical Corp. posted a 24 percent increase in first-half net income.
China Petroleum & Chemical Corp. revamped its refining business and brought it to profit levels to outperform PetroChina Co. The company has been using better technology and modern refineries that have helped it process almost double what PetroChina refined. The latest changes brought in technology front have been profit generating for the company.
Refining Technology and Cost Control Mechanism, Major Contributors
Market analysts and energy experts consider that it was Sinopec’s sophisticated refining technologies and excellent cost control which have contributed to the profits it has made in the first half of the year. They are expecting that Sinopec will have better third quarter and the best second half from there.
Analysts are also of the opinion that whereas Sinopec honed its refining business to increase efficiency and reduce costs, PetroChina seemed interested in oil and gas production and did not pay much heed to business. The company claims that a lot of its better performance in the first half is due to its optimized marketing of LPG, asphalt and paraffin, its specialization.
The company in its official release revealed that in the first half of 2013, it adjusted its product mix in response to changes in domestic market demand and produced more gasoline, jet fuel and other high-value-added products. It also upgraded fuel quality by increasing the production of gasoline and diesel above GB IV standards.
Oil and Gas Exploration Also Contributed to the Company’s Growth
Sinopec’s growth is also attributed to the oil and gas exploration through domestic growth in five key areas e.g. Tarim Basin, the western rims of the Junngar Basin, the Ordos Basin, the Sichuan Basin and the Xihu depression. It maintained a highly efficient level of production in oil and gas wherein the production went up to 153.66 million barrels of crude oil which is up by 1.1% compared with the corresponding period in 2012.
The company also produced 324.14 billion cubic feet of natural gas, a significant increase of 11.8% compared with the corresponding period in 2012. In comparison to Sinopec, PetroChina posted a 5.6 percent increase in first-half profit on Aug. 22; Cnooc Ltd. posted a 7.9 percent gain in profit on August 20.
To contact the reporter of this story: Jonathan Millet at email@example.com