Published: March 21 2007 02:00 | Last updated: March 21 2007 02:00
Beijing’s drivers are paying less for their petrol this month, with PetroChina having temporarily cut pump prices during March. Coincidentally, this came just as the National People’s Congress was sitting down to meet in the Chinese capital.
Political influence over PetroChina, the world’s fourth largest oil and gas company by market capitalisation, is a given – the state owns 88 per cent of it. For minority investors, that is a double-edged sword. On one hand, Beijing can unlock access to energy reserves overseas. On the other, it claws back gains that might otherwise line the pockets of shareholders.
PetroChina’s latest set of annual results epitomise this. The average price of Asia’s benchmark Minas crude oil blend rose by $12 per barrel, or 23 per cent in 2006, yet the company’s earnings increased by just 5 per cent. All-in costs in the dominant exploration and production business rose by about $8 per barrel of oil equivalent produced. Of that rise, more than 40 per cent was owing to the imposition of a windfall tax by Beijing last year.
More worrying is the question of whether PetroChina is succumbing to the industry disease of rising costs and capital expenditure. PetroChina expects to spend $24bn on capex this year – more than ExxonMobil.
That suggests PetroChina prioritises longer-term output growth over near-term financial metrics, which should play well with the Chinese government. But it would be unfair to point the finger wholly at political influence. BP and Royal Dutch Shell have also recently increased budgets and emphasised their long-term potential.
One advantage PetroChina has is its outstanding record on reserves replacement: an average of 164 per cent over the past three years, compared with just 78 per cent for its global peers, according to UBS. With the entire sector struggling to contain costs, PetroChina does at least offer a solid basis for growth – a rare commodity in today’s energy industry.
Copyright The Financial Times Limited 2007
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Royal Dutch Shell conspired directly with Hitler, financed the Nazi Party, was anti-Semitic and sold out its own Dutch Jewish employees to the Nazis. Shell had a close relationship with the Nazis during and after the reign of Sir Henri Deterding, an ardent Nazi, and the founder and decades long leader of the Royal Dutch Shell Group. His burial ceremony, which had all the trappings of a state funeral, was held at his private estate in Mecklenburg, Germany. The spectacle (photographs below) included a funeral procession led by a horse drawn funeral hearse with senior Nazis officials and senior Royal Dutch Shell directors in attendance, Nazi salutes at the graveside, swastika banners on display and wreaths and personal tributes from Adolf Hitler and Reichsmarschall, Hermann Goring. Deterding was an honored associate and supporter of Hitler and a personal friend of Goring.
Deterding was the guest of Hitler during a four day summit meeting at Berchtesgaden. Sir Henri and Hitler both had ambitions on Russian oil fields. Only an honored personal guest would be rewarded with a private four day meeting at Hitler’s mountain top retreat.
IN JULY 2007, MR BILL CAMPBELL (ABOVE, A RETIRED GROUP AUDITOR OF SHELL INTERNATIONAL SENT AN EMAIL TO EVERY UK MP AND MEMBER OF THE HOUSE OF LORDS: 
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