PetroChina Co (中石油), the world’s second-largest company by market value, said it needs to raise 150 billion yuan (US$22 billion) in funds this year because tax payments may rise and cash flow has diminished.
Free cash flow, or the cash available for investing or financing after meeting certain expenses from operations, declined by 76.9 billion yuan last year because of tax payments and investments, the company said in a statement to the Shanghai stock exchange.
The oil producer had negative free cash flow of 44.9 billion yuan last year, according to the statement.
PetroChina plans to pay as much as US$1.4 billion for a stake in a Kazakh oil company to take advantage of lower commodity prices and expand overseas, chairman Jiang Jiemin (蔣潔敏) said on April 16. Parent China National Petroleum Corp (中石油集團) plans to sell as much as US$3 billion in bonds and may start issuing notes within two months, an industry association said on April 27.
“PetroChina still has a very healthy financial position as its debt-to-asset ratio is low,” Grace Liu (劉谷), an oil analyst at Guotai Junan Securities Hong Kong Ltd (國泰君安證券), said by telephone from Shenzhen. “It won’t be hard for them to borrow from banks.”
PetroChina faces “severe challenges” because the global financial crisis has lowered crude-oil prices and cut fuel and petrochemical demand since the second half of last year, according to the statement dated yesterday.
In order to conserve energy consumption, China, the world’s second-biggest oil user, increased the fuel consumption tax paid by refiners and importers eightfold, according to a statement on the government’s Web site on Dec. 19.
PetroChina’s fuel-consumption tax payment may jump by 71 billion yuan this year to 84.2 billion yuan because of the rate adjustment, the company said in the statement.
Shares of the oil producer fell 0.4 percent to HK$7.49 in Hong Kong at the midday break, compared with a 0.2 percent gain in the benchmark Hang Seng index.
PLA MANEUVERS: Although Beijing has yet to formally announce military drills, its coast guard vessels have been spotted near and around Taiwan since Friday The Taiwanese military is on high alert and is closely monitoring the Chinese People’s Liberation Army’s (PLA) air and naval deployments after Beijing yesterday reserved seven airspace areas east of its Zhejiang and Fujian provinces through Wednesday. Beijing’s action was perceived as a precursor to a potential third “Joint Sword” military exercise, which national security experts said the PLA could launch following President William Lai’s (賴清德) state visits to the nation’s three Pacific allies and stopovers in Hawaii and Guam last week. Unlike the Joint Sword military exercises in May and October, when Beijing provided detailed information about the affected areas, it
Five flights have been arranged to help nearly 2,000 Taiwanese tourists return home from Okinawa after being stranded due to cruise ship maintenance issues, the Ministry of Transportation and Communications announced yesterday. China Airlines Ltd (中華航空), and EVA Airways Corp (長榮航空) have arranged five flights with a total of 748 additional seats to transport 1,857 passengers from the MSC Bellissima back to Taiwan, the ministry said. The flights have been scheduled for yesterday and today by the Civil Aviation Administration, with the cruise operator covering all associated costs. The MSC Bellissima, carrying 4,341 passengers, departed from Keelung on Wednesday last week for Okinawa,
US president-elect Donald Trump said he would “never say” if Washington is committed to defending Taiwan from China, but “I would prefer that they do not do it [ an attack],” adding that he has a “good relationship” with Chinese President Xi Jinping (習近平). “I never say because I have to negotiate things, right?” Trump said in an interview with NBC’s Meet the Press host Kristen Welker after saying he would not reveal his incoming administration’s stance on Taiwan’s defense in the event of an attack. Asked the question again, Trump, in a reference to China, said: “I would prefer that they
CROSS-STRAIT TENSIONS: MOFA demanded Beijing stop its military intimidation and ‘irrational behavior’ that endanger peace and stability in the Indo-Pacific region The Presidential Office yesterday called on China to stop all “provocative acts,” saying ongoing Chinese military activity in the nearby waters of Taiwan was a “blatant disruption” of the “status quo” of security and stability in the Indo-Pacific region. Defense officials said they have detected Chinese ships since Monday, both off Taiwan and farther out along the first island chain. They described the formations as two walls designed to demonstrate that the waters belong to China. The Ministry of National Defense yesterday said it had detected 53 military aircraft operating around the nation over the past 24 hours, as well
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