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Message: Sinopec eyes overseas acquisitions
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The following article is interesting in that it states that Sinopec which is the second largest oil company in China after PetroChina Co. Ltd., and the 2nd largest refiner in the world after Exxon-Mobil has stated today that it is interested in making acquisitions in Latin America this year. This means that Sinopec may be interested in acquiring Petrolifera's holdings in Argentina, or it may be interested in farming in with Petrolifera in its exploration targets in Peru at the end of 2009. We can only hope.
Sinopec eyes overseas acquisitions
Sinopec eyes overseas acquisitions, refining turnaround
SUI-LEE WEE AND JOSEPH CHANEY
Reuters
March 30, 2009 at 8:16 AM EDT
"HONG KONG — Top Asian oil refiner China Petroleum & Chemical Corp. (Sinopec) is eyeing overseas projects for its exploration and production business, as the sharp fall in crude oil prices spurs bargain hunting among oil giants.
Sinopec, which has aggressively pursued acquisitions beyond China, is focusing on opportunities in Africa and South America in the near term, chairman Su Shulin said on Monday.
“The current oil prices are lingering at a low level,” Mr. Su said. “This creates more opportunities for upstream transactions. Sinopec is now more prepared for overseas acquisitions in the [exploration and production] segment.”
He declined to specify which companies Sinopec, China's No. 2 oil and gas producer after PetroChina Co. Ltd., is targeting.
Sinopec, the world's second-largest refiner after Exxon Mobil Corp., also has permission to buy assets from Sinopec Group, its parent company, but Mr. Su said he did not have a detailed timetable for the transactions.
For most of last year, state-owned Sinopec was forced to take losses at its refining operations as it had to supply the world's second-largest oil consuming nation with fuel at low prices set by a government wary of inflationary pressures, even when crude oil prices hit a record $147 (U.S.) per barrel in July.
Oil prices – reeling from the global financial crisis – have since plummeted and were hovering below $51 a barrel in early trading on Monday.
Like international rivals Exxon Mobil and Chevron Corp., Sinopec's refineries had a better-than-expected performance after oil prices declined sharply in the last quarter of 2008, cutting its input costs and bolstering margins.
Analysts say Sinopec should see a turnaround this year, especially after Beijing moved last week to hike fuel prices, guaranteeing higher and more stable profit margins for refiners.
Mr. Su said the refining segment will now be a pillar contributor to the firm's profits, adding that Sinopec has seen a rise in sales in the first quarter from its refined products and chemicals segments.
Sinopec said on Sunday its profit for the first quarter would rise by more than 50 per cent compared to the same period a year ago, boosted by improved refining economics because of the sharp fall in crude oil prices.
After March 25, Sinopec's sales in refined products amounted to 339,000 tonnes, up from 317,000 tonnes in the first three weeks of March, Mr. Su said. In February, the firm sold 293,000 tonnes of refined products.
“The refining business will not make a loss this year,” Mr. Su said, adding that the performance will depend on crude prices.
“The oil price will not stay at a very low level for a long time and will likely pick up in future,” he said, adding that crude could reach $80 a barrel after this year.
Sinopec's sales from its chemicals division will grow in 2009, driven by strong demand and scarce supply, Mr. Su said.
China needs 21.3 million tonnes of chemicals to satisfy demand at home this year, but domestic producers can only churn out 10.5 million tonnes, Mr. Su said, adding that the firm plans to expand sales to its domestic market to meet the shortfall.
Sinopec posted a near doubling in quarterly profit on Sunday thanks to state handouts and the steep decline in crude oil prices that restored refining profits, but it warned of a challenging 2009 as a result of the global economic downturn. "
SUI-LEE WEE AND JOSEPH CHANEY
Reuters
March 30, 2009 at 8:16 AM EDT
"HONG KONG — Top Asian oil refiner China Petroleum & Chemical Corp. (Sinopec) is eyeing overseas projects for its exploration and production business, as the sharp fall in crude oil prices spurs bargain hunting among oil giants.
Sinopec, which has aggressively pursued acquisitions beyond China, is focusing on opportunities in Africa and South America in the near term, chairman Su Shulin said on Monday.
“The current oil prices are lingering at a low level,” Mr. Su said. “This creates more opportunities for upstream transactions. Sinopec is now more prepared for overseas acquisitions in the [exploration and production] segment.”
He declined to specify which companies Sinopec, China's No. 2 oil and gas producer after PetroChina Co. Ltd., is targeting.
Sinopec, the world's second-largest refiner after Exxon Mobil Corp., also has permission to buy assets from Sinopec Group, its parent company, but Mr. Su said he did not have a detailed timetable for the transactions.
For most of last year, state-owned Sinopec was forced to take losses at its refining operations as it had to supply the world's second-largest oil consuming nation with fuel at low prices set by a government wary of inflationary pressures, even when crude oil prices hit a record $147 (U.S.) per barrel in July.
Oil prices – reeling from the global financial crisis – have since plummeted and were hovering below $51 a barrel in early trading on Monday.
Like international rivals Exxon Mobil and Chevron Corp., Sinopec's refineries had a better-than-expected performance after oil prices declined sharply in the last quarter of 2008, cutting its input costs and bolstering margins.
Analysts say Sinopec should see a turnaround this year, especially after Beijing moved last week to hike fuel prices, guaranteeing higher and more stable profit margins for refiners.
Mr. Su said the refining segment will now be a pillar contributor to the firm's profits, adding that Sinopec has seen a rise in sales in the first quarter from its refined products and chemicals segments.
Sinopec said on Sunday its profit for the first quarter would rise by more than 50 per cent compared to the same period a year ago, boosted by improved refining economics because of the sharp fall in crude oil prices.
After March 25, Sinopec's sales in refined products amounted to 339,000 tonnes, up from 317,000 tonnes in the first three weeks of March, Mr. Su said. In February, the firm sold 293,000 tonnes of refined products.
“The refining business will not make a loss this year,” Mr. Su said, adding that the performance will depend on crude prices.
“The oil price will not stay at a very low level for a long time and will likely pick up in future,” he said, adding that crude could reach $80 a barrel after this year.
Sinopec's sales from its chemicals division will grow in 2009, driven by strong demand and scarce supply, Mr. Su said.
China needs 21.3 million tonnes of chemicals to satisfy demand at home this year, but domestic producers can only churn out 10.5 million tonnes, Mr. Su said, adding that the firm plans to expand sales to its domestic market to meet the shortfall.
Sinopec posted a near doubling in quarterly profit on Sunday thanks to state handouts and the steep decline in crude oil prices that restored refining profits, but it warned of a challenging 2009 as a result of the global economic downturn. "
Best Wishes; Scott
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