About PetroChina Company

PetroChina Company Limited operates as an oil and gas producer and seller occupying a leading position in the oil and gas industry in China. The company is a subsidiary of China National Petroleum Corporation. The company’s principal business lines include the exploration, development, transmission, production and marketing of crude oil, natural gas and new energy; the refining of crude oil and petroleum products, as well as the production and marketing of basic petrochemical products, derivative chemical products and other chemical products and new materials; the marketing and trading of refined oil products and non-oil products; and the sale of natural gas. Substantially all of the company’s crude oil and natural gas reserves and production-related assets are located in China. In 2022, the company imported approximately 528.8 million barrels of crude oil. Segments The company operates through Oil, Gas and New Energy Resources; Refining, Chemicals and New materials, Marketing, and Natural Gas Sales segments. The Oil, Gas and New energy resources segment is engaged in the exploration, development, transportation, production, marketing of crude oil and natural gas and new energy resources business. The Refining, Chemicals and New Materials segment is engaged in the refining of crude oil and petroleum products, production and marketing of primary petrochemical products, derivative petrochemical products, other chemical products, and new materials business. The Marketing segment is engaged in the marketing of refined products and non-oil products, and the trading business. The Natural Gas Sales segment is engaged in the transportation and sale of natural gas. Oil, Gas and New Energy The company engages in crude oil and natural gas exploration, development and production and new energy business. Substantially all of the company’s estimated proved crude oil and natural gas reserves are located in China, principally in Northeastern, Northern, Southwestern and Northwestern China. Meanwhile, the company has enhanced its overseas cooperation and expanded its strategic presence in five major overseas oil and gas cooperation regions by conducting new project development. In 2022, the company strengthened its overall research and top-down design in the domestic oil and gas business, risk exploration in new areas and new fields and the concentrated exploration and fine exploration in key reserve-increasing areas and strategic replacement areas. The company achieved multiple breakthroughs and important discoveries in Tarim, Junggar, Sichuan, Bohai Bay and other key basins, developing into various large-scale oil and gas reserve areas. The company vigorously enhanced the stable output in the existing oil and gas fields and optimized the layout of production capacity in new fields, and the output of oil and gas continued to increase. In 2022, the company’s domestic business achieved a crude oil output of 767.4 million barrels; a marketable natural gas output of 4,471.3 Bcf; and an oil and natural gas equivalent output of 1,512.6 million BOE. In 2022, the company’s overseas oil and gas business adhered to high quality development, and important discoveries have been made in various projects, such as Niger and Chad; the company enhanced full-cycle management of development plans, promoting various key capacity projects put into operation. In 2022, the company enhanced the acquisition of new projects and cooperation in existing projects, completed the restructuring and closing of the Rumaila project, and extended the contract term of the Aktobe project. In 2022, the crude oil output from overseas operations amounted to 138.8 million barrels; the output of marketable natural gas from overseas operations was 203.7 Bcf; and the output of oil and gas equivalent from overseas operations was 172.8 million BOE, accounting for 10.3% of the company’s total oil and natural gas equivalent output. In 2022, the company’s crude oil output amounted to 906.2 million barrels. The marketable natural gas output reached 4,675.0 Bcf. The oil and natural gas equivalent output amounted to 1,685.4 million BOE. As of December 31, 2022, the company’s exploration and exploitation licenses for oil and gas (including coalbed methane) covered a total area of approximately 240.7 million acres, including the exploration licenses covering a total area of approximately 203.0 million acres and the production licenses covering a total area of approximately 37.7 million acres. Exploration and Development The company conducts exploration and development in 12 provinces, two municipalities under the direct administration of the central government and three autonomous regions in China, as well as in certain regions in other countries. Production In 2022, the company supplied a substantial majority of its total crude oil sales to the company’s own refineries. In addition, the company and China Petroleum & Chemical Corporation, or Sinopec, supply crude oil to each other’s refineries to allow supplies to be easily obtained from nearby resources. Principal Oil and Gas Regions Daqing Oil Region The Daqing oil region is the company’s largest oil and gas producing property, located in the Songliao basin and consisting of 40 oilfields. In 2022, the Daqing oil region produced an average of 601.5 thousand barrels of crude oil per day, representing approximately 24.2% of the company’s total daily crude oil production. Daqing’s crude oil has low sulfur and high paraffin content. As many refineries in China, particularly those in Northeastern China, primarily refine Daqing crude oil, the company has a stable market for the crude oil the company produces in the Daqing oil region. Changqing Oil and Gas Region The Changqing oil and gas region covers parts of Shaanxi Province, Gansu Province, Ningxia, Inner Mongolia and Shanxi Province; and consists of 48 oil and gas producing blocks. In 2022, the Changqing oil region produced an average of 519.8 thousand barrels of crude oil per day and an average of 4.2 Bcf of natural gas for sale per day, respectively, representing approximately 20.9% of the company’s total daily crude oil production, and approximately 32.5% of the company’s total daily production of natural gas for sale, respectively. Sulige gas field is the largest gas field in China. Changqing crude oil has low sulfur content and is paraffin-based. The company has configured the Changqing oil region with refineries specializing in the refining of Changqing crude oil located in the adjacent area. Sinopec also has refineries nearby. In addition, supporting railway facilities have been built for outgoing transportation of relevant products from the Changqing oil and gas region. The company therefore has a stable market for the crude oil the company produces in the Changqing oil region. The majority of the natural gas produced at the Changqing oil and gas region has been transmitted to Beijing, Tianjin and Hebei regions and a small portion is offered for sale in Shaanxi, Inner Mongolia, Gansu, Ningxia and other parts of Northwestern China. Xinjiang Oil Region The Xinjiang oil region is located in the Junggar basin in Northwestern China, consisting of 29 oil producing blocks. In 2022, the company’s crude oil production fields in the Xinjiang oil region produced an average of 288.6 thousand barrels per day, representing approximately 11.6% of the company’s total daily crude oil production. Xinjiang crude oil comes in multiple varieties, namely light crude oils, medium crude oils and heavy crude oils. The company has configured Xinjiang oilfields with refineries located in the adjacent area and pipelines for crude oil outgoing transportation so that the crude oil produced in the Xinjiang oil region can be delivered to other refineries located in the western region. The company therefore has a stable market for the crude oil the company produces in the Xinjiang oil region. Tarim Oil and Gas Region The Tarim oil and gas region is located in the Tarim basin in Northwestern China, consisting of 33 oil producing blocks. In 2022, the Tarim oil and gas region produced an average of 148.7 thousand barrels of crude oil per day and an average of 2.9 Bcf of natural gas for sale per day, respectively, representing approximately 6.0% of the company’s total daily crude oil production, and approximately 22.3% of the company’s total daily natural gas for sale, respectively. The company delivers natural gas produced in the Tarim oil and gas region through gas pipelines to the central and eastern regions of China where there is strong demand for natural gas. Chuanyu Gas Region The Chuanyu gas region is located in the Sichuan basin in Southwestern China, consisting of 119 gas producing blocks. In 2022, the Chuanyu gas region produced an average of 3.4 Bcf of natural gas for sale per day, representing approximately 26.6% of the company’s total daily production of natural gas for sale. In 2019, the company discovered the Sichuan shale gas field in the Chuanyu gas region. The majority of the natural gas produced at the Chuanyu gas region is offered for sale in the Chuanyu region and only a small portion is transmitted to Central and South China. New Energy Business The company has accelerated the development of new energy business and the construction of key projects, achieving remarkable results in the expansion in the markets of clean energy substitution for production and external clean energy supply. The company has strived to obtain clean power grid connection, and vigorously promoted wind power generation, photovoltaic power generation, geothermal heating and CCUS businesses. The company’s first integrated wind and solar storage development project – the Daqing Oilfield Puerlian small-sized distributed generation cluster demonstration and application project (first phase) has been connected to the power grid for power generation. In 2022, the company completed wind and photovoltaic power projects with an aggregate installed capacity of more than 1.4 million kilowatts and an aggregate geothermal heating area of 25 million square meters. In 2022, the total capacity of the company’s new energy projects developed and utilized amounted to 8 million tons of standard coal per year. Refining, Chemicals and New Materials The company operates 33 enterprises located in nine provinces, four autonomous regions and three municipalities to engage in refining of crude oil and petroleum products, as well as the production and marketing of basic petrochemical products, derivative chemical products, new materials and other chemical products. In 2022, the company grasped opportunities arising from the industry and market demand changes in the refining, chemicals and new materials business, and continued to push forward the transformation and upgrades. The company promptly optimized the workload of production equipment and products structure, adhered to the strategy to reduce the production of refined products and increase the production of chemical products, to reduce the production of traditional refining products and increase the production of special petroleum products, and vigorously developed new chemical products and materials. The company also improved the integrated technical service system of production, marketing, research and application, leveraged the function of the ‘PetroChina e-Chemical’ platform, and strengthened the marketing of chemical products. In 2022, the company processed 1,212.7 million barrels of crude oil, among which 688.7 million barrels of crude oil were from the company’s oil and gas business, accounting for 56.8% of the total amount and showing good synergic effects; the company produced 105.354 million tons of refined oil; the volume of chemical products output was 31.568 million tons; and the volume of new chemical materials output reached 0.855 million tons. Refining Refined Products The company produces a wide range of refined products at its refineries. Some of the refined products are for the company’s internal consumption and used as raw materials in the company’s petrochemical operation. Refineries Most of the company’s refineries are strategically located close to the company’s crude oil production and storage bases along the crude oil and refined product transmission pipelines and railways, which provide the company’s refineries with secure supplies of crude oil and facilitate the company’s distribution of refined products to the domestic markets. In 2022, Daqing Petrochemical, Jilin Petrochemical, Fushun Petrochemical, Lanzhou Petrochemical, Dushanzi Petrochemical, Dalian Petrochemical, Dalian West Pacific, Liaoyang Petrochemical, Huabei Petrochemical, Urumqi Petrochemical, Guangxi Petrochemical, Sichuan Petrochemical and Yunnan Petrochemical were the company’s principal refineries in terms of both primary distillation capacity and refining throughput. Guangdong Petrochemical will also be a principal refinery once it is put into production. In 2022, Guangdong Petrochemical’s integrated refining and chemicals project, Jilin Petrochemical’s Jieyang ABS project and certain other projects have been fully completed. The construction of key projects, such as Jilin Petrochemical’s refining and chemical transformation and upgrading project has commenced. Chemicals Most of the company’s chemical plants are close to the company’s refineries and are connected to the refineries by pipelines, providing additional production flexibility and opportunities for cost competitiveness. The raw materials required by the company’s chemicals operations are mainly supplied by the company’s own refineries. Chemical Products The company is one of the major producers of ethylene in China. The company uses the bulk of the ethylene the company produces as a principal feedstock for the production of many chemical products, such as polyethylene. As of December 31, 2022, the company’s annual ethylene production capacity was 8,610 thousand tons. The company produces a number of synthetic resin products, including polyethylene, polypropylene and ABS. As of December 31, 2022, the company’s annual production capacities for polyethylene, polypropylene and ABS were 7,662 thousand tons, 5,020 thousand tons and 1,303 thousand tons, respectively. Marketing of Chemicals The company’s chemical products are distributed to a number of industries, including the automotive, construction, electronics, pharmaceutical, printing, electrical appliances, household products, insulation, packaging, paper, textile, paint, footwear, agriculture and furniture industries. Marketing The company engages in domestic marketing of refined products through 34 regional sales companies, including two distribution branch companies and one convenience store chain company, PetroChina uSmile Company Limited, operated under the trade name ‘uSmile’. These operations include transportation and storage of the refined products, wholesale, retail and export of gasoline, diesel, kerosene and other refined products, and non-oil business. The company engages in international trade business through PetroChina International Company Limited. Its major businesses include international trade in crude oil, refined oil, natural gas, petrochemical products, oil and gas entrepot trade, investment, construction and operation of overseas trade operation platforms, and futures business. With respect to the company’s domestic sales business, the company’s marketing network consists of: Nationwide wholesale distribution outlets. Almost all of these outlets are located in high demand areas across China, particularly in the coastal areas, along major railways and along the Yangtze River. The company sells refined products both directly and through distributors to various wholesale markets, as well as to utility, commercial, petrochemical, aviation, agricultural, fishery and transportation companies in China. Service stations owned and operated by the company and franchised service stations owned and operated by third parties across China. Natural Gas Sales The company is China’s largest natural gas seller. The company sells natural gas primarily to industrial companies, power plants, fertilizer and chemical companies, commercial users and municipal utilities owned by local governments. Principal Markets for Natural Gas The company sells its natural gas across China. The company’s natural gas supply covers all provinces, municipalities under direct administration of the central government, autonomous regions and Hong Kong of China, except Macau and Taiwan. The Bohai Rim, the Yangtze River Delta and the Southwestern region in China are the company’s principal markets for natural gas. In addition, provinces, such as Inner Mongolia, and Anhui consume more and more natural gas and have become another significant natural gas market of the company. The company supplies natural gas to these regions primarily through pipelines except for Tibet where the company supplies natural gas by LNG tanker trucks. Competition The company’s principal competitors in China are China Petrochemical Corporation, or Sinopec Group, and China National Offshore Oil Corporation, or CNOOC. Refining, Chemicals and New Materials and Marketing: The company competes with its primary competitor Sinopec in the company’s refining and chemicals operations and marketing operations. Natural Gas Sales: The company mainly faces competition from Sinopec and CNOOC. Intellectual Property The company’s logo is jointly owned by the company and CNPC and has been used since December 26, 2004. Together with CNPC, the company has applied for trademark registrations of the logo both in China and abroad. The company has received 506 International Trademark Registration Certificates for the company’s logo covering more than 50 jurisdictions. As of December 31, 2022, the company owned approximately 19,869 patents in China and other jurisdictions. The company was granted 1,598 patents in 2022. Regulatory Matters The Ministry of Commerce has granted the company the right to conduct crude oil and refined product import and export business. Research and Development In the year ended December 31, 2022, the company’s total expenditures for research and development (including capitalized expenditures) were approximately RMB28,718 million. History PetroChina Company Limited was founded in 1999.