PetroChina and Sinopec cut upstream targets

摘要

China’s main state-run oil firms have reduced their upstream targets for this year, after their second-quarter profits declined. But they have left capital expenditure (capex) plans largely unchanged, which could weigh on free cash flow. Sinopec made a 13.3bn yuan ($2bn) profit in April-June, down by 43pc on the year, while PetroChina’s fell by 26pc to Yn14.3bn (see table). The former has revised down its 2016 crude production target by a further 9pc to 820,000 b/d and cut its natural gas output goal by 6pc to 2.2bn ft3/d (22.7bn m3), compared with March guidance. PetroChina has pared its crude production target by a further 3pc since March, to 2.5mn b/d, but has left its gas output goal unchanged at 8.7bn ft3/d, despite falling revenue because of sales at lower values.