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Sinopec Profit Drops as Crude Slump Beats Out Refining Gains

China Petroleum & Chemical Corp.’s third-quarter profit plummeted 92 percent as lower oil prices and production dwarfed an increase in refining revenue. Net income at Asia’s biggest refiner, known as Sinopec, was 1.64 billion yuan ($258 million), or 0.013 yuan a share, compared with 19.3 billion yuan, or 0.165 yuan, a year earlier, the Beijing-based company said in a statement to the Shanghai Stock Exchange on Thursday. That compares with the 4.27 billion yuan average of three analyst estimates compiled by Bloomberg. Higher refining revenue was swamped by a drop in oil prices. Brent, the benchmark for more than half of the world’s crude, averaged about $51 a barrel in the third quarter, compared with more than $103 a year ago. Prices have slumped more than 45 percent in the past year amid a global glut that the International Energy Agency estimates will remain until at least the middle […]

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PetroChina Profit Plunges to Record Low on Oil Price Rout

PetroChina Co., the country’s biggest oil and gas producer, posted its worst quarterly profit as a plunge in crude prices punished revenue. The company, faced with a “complicated and grim operating environment,” posted net income of 5.2 billion yuan ($818 million), or 0.03 yuan a share, compared with 27.9 billion yuan, or 0.15 yuan, a year earlier, it said in a statement to the Hong Kong stock exchange on Thursday. That compared with the 10.9 billion yuan average of four analyst estimates compiled by Bloomberg and the lowest earnings since 2007, when Bloomberg started compiling quarterly data on the company. “It’s a pretty weak performance across all segments,” Neil Beveridge, an analyst at Sanford C. Bernstein & Co., said by phone from Hong Kong. “PetroChina is struggling in the low crude environment and needs to find a way to stop the bleeding.” The Beijing-based company relies on oil and […]

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Oil Producers Curb Megaproject Ambitions to Focus on U.S. Shale

Big U.S. oil companies are starting to think small. A stubborn 16-month crude rout with no end in sight is driving the largest U.S. oil producers away from costly, high-risk megaprojects long touted as the industry’s future and toward safer shale operations that generate the cash needed to satisfy anxious investors. Exxon Mobil Corp., Royal Dutch Shell Plc, Chevron Corp., ConocoPhillips and Hess Corp. have all either delayed or abandoned projects that range from the deep seas of the Gulf of Mexico to Canada’s oil sands and the U.S. Arctic. At the same time, Exxon and Chevron both announced plans to substantially increase U.S. crude production, largely as a result of their shale operations. “What makes more sense in this environment: drill a $100 million well in the deepwater Gulf that might come up empty, or poke lots of holes in west Texas where you already know there’s oil […]

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Don’t Look to China for Oil Rebound

China continues to keep the oil bulls at bay. The country’s two biggest oil companies offered a bleak picture of demand from the world’s marginal consumer of the commodity in its latest quarterly results, out Thursday. At Sinopec, the country’s biggest refiner, officially known as China Petroleum & Chemical , SNP -1.63 % total sales of refined products in the third quarter dropped 3.4% in volume from a year before. That’s a marked change from their 5.3% rise during the first half of the year. Yet this dismal figure is bloated by Sinopec’s increasing exports of refined products, a symptom of China’s excess refining capacity. Strip those out and Sinopec’s domestic sales of gasoline, diesel and more were down 4.2% in the September quarter. At PetroChina, the nation’s second-largest refiner, product sales fell about 2% last quarter. For the past two years, China’s industrial slowdown has been hurting use […]

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Shell mulls options offshore Alaska

Despite a series of setbacks off the coast of Alaska, Shell said it’s eager to protect its leases and assets in the region. Photo courtesy of the Bureau of Safety and Environmental Enforcement THE HAGUE, Netherlands, Oct. 29 (UPI) — Despite regulatory and exploration setbacks for the arctic waters off the coast of Alaska, Royal Dutch Shell said it was keen on protecting its regional assets. The U.S. Bureau of Safety and Environmental Enforcement in August awarded Shell with one permit to start drilling an exploration well into oil-bearing zones in the Burger prospect in the arctic waters off the coast of Alaska. A federal study of the Burger prospect from 2004 described it as likely the largest reserve pool of its kind off the Alaskan coast Last month, Shell said it found evidence of oil and natural gas in its Burger exploration well, but not enough to warrant […]

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New oil production begins in Gulf of Mexico

Houston-based Noble Energy starts production from Big Bend project in the U.S. waters of the Gulf of Mexico, a region offsetting some of the decline from inland shale basins. File photo by Maryam Rahmanian/UPI HOUSTON, Oct. 29 (UPI) — The Big Bend project, a new single-well field online in the Gulf of Mexico, is on pace to reach maximum output before the end of November, Noble Energy said. Noble, a company with headquarters in Houston, said it started production from its Big Bend project in the deep waters of the Gulf of Mexico. The single-well field should be producing around 20,000 barrels of oil equivalent per day in a matter of weeks. Around 90 percent of the overall production volumes are oil. Gary Willingham, vice president of operations for Noble, said in a statement that Big Bend is among a handful of projects expected to come online for the […]

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Canada’s Suncor producing more oil

Canadian oil sands producer Suncor reports production increase from third quarter, though profits down during depressed market. Photo courtesy of Suncor CALGARY, Alberta, Oct. 29 (UPI) — Canadian oil company Suncor said production for the third quarter was up 9 percent year-on-year at a time when surplus is driving industry profits down. "Our focus on operational discipline continues to pay off," President and Chief Executive Officer Steve Williams said in a statement. Suncor, the largest energy company in Canada, reported total production for the third quarter of 566,100 barrels of oil equivalent per day, up 9 percent year-on-year, because of strong results from British output and Canadian oil sands operations. Oil sands, which accounted for the vast majority of the company’s output, increased in production by 4.5 percent from third quarter 2014. Crude oil prices are depressed in part because markets are favoring the supply side at a time […]

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Shell swings to $7.4bn loss on oil price slump and axed projects

Sign up for quick access to a wealth of global business news, including: Shell swings to $7.4bn loss on oil price slump and axed projects Newspaper + Premium online Newspaper + Premium online Premium Full FT.com subscription Premium Full FT.com subscription Standard Full news & archive Standard Full news & archive Trial Try Premium online Trial Try Premium online Price Monthly Annual $66.30 $11.77 per week $53.00 $9.25 per week $36.00 $6.45 per week $1.00 for 4 weeks $1.00 for 4 weeks FT Alphaville plus selected FT blogs yes yes yes yes Unlimited FT.com article access yes yes yes yes Unlimited mobile and tablet access yes yes yes yes Unlimited fast FT yes yes yes yes 5 year company financials archive yes yes yes yes The LEX column yes yes no yes ePaper access yes yes no yes Three exclusive weekly emails yes yes no yes Daily newspaper delivery […]

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Canadian Oil Sands Ltd. Posts Net Loss, Sharply Lower Operating Profit

CALGARY, Alberta— Canadian Oil Sands Ltd. COSWF 1.48 % , the largest stakeholder in the Syncrude oil-sands consortium, on Thursday swung to a net loss and posted a sharply lower operating profit in its latest quarter due to falling production volumes and a slump in crude oil prices. The Calgary-based company reported a net loss of 174 million Canadian dollars ($132 million), or 36 Canadian cents a share, for the three months ended Sept. 30, compared with a net profit of C$87 million, or C$0.18 a share, in the year-earlier period. It said that came partly from a C$184 million foreign exchange loss linked to U.S. dollar-denominated debt due to a weaker Canadian currency. Cash flow from operations, which is adjusted to exclude one-time items, slid 73% to C$82 million, or C$0.17 a share, down from C$302 million, or C$0.62 per share, a year ago. Canadian Oil Sands blamed […]

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Audit Finds Montana Railroad Safety Lacking as Oil Traffic Rises

HELENA, Mont.—Montana’s oversight of railroad safety falls short at a time when crude-oil train traffic from the Bakken region, already high, is only expected to increase, a new audit found. Montana has no active rail-safety plan and employs only two inspectors to cover the state, the Montana Legislative Audit Division report released Wednesday said. In addition, there is a lack of statewide emergency planning and hazardous-material response capability should an oil spill occur, the report said. That is a potentially precarious situation with a new crude-oil transfer station in North Dakota coming online that should boost oil traffic crossing Montana from about 10 trains a week to as many as 15 cars a week. About 20% of Montanans live in an evacuation zone for an oil-train derailment, which is within a half-mile of a rail line, the report said. Two of the agencies criticized in the report said they […]

Posted On : Published By : Tom Whipple