Last year, the oil giant made a total of RMB270 billion in windfall profits tax of RMB172 billion.

Business Club March 31st With the release of the annual report of CNPC on the 29th, the performance of China's three major oil companies in 2011 has been announced. Three barrels of oil earned a total of 274.935 billion yuan last year.

At the same time, the special oil revenues of the three companies reached 172 billion yuan, of which CNPC contributed 102.5 billion yuan, hitting a record high.

In terms of profit growth, CNOOC (00883.HK) took the lead, an increase of 29.1% year-on-year, Sinopec (600028.SH, 00385.HK) increased by 1.4% year-on-year, and PetroChina decreased by 4.3% year-on-year.

The key to the disparate performance of the three companies lies in the refining business. The assets of CNOOC listed companies do not include any refineries. In the case of high oil prices, and the maximum retail price of domestic refined oil is under state control, the refining business will weigh on corporate profits.

This year's windfall tax or reduction of annual reports shows that the growth rate of oil and gas production in the three barrels of oil last year remained basically stable, while upstream oil and gas revenues have all increased substantially. Among them, the upstream revenue growth of CNOOC and Sinopec was close to 30%, and PetroChina's upstream revenue grew by 42.2%.

In the annual report released yesterday, CNPC said that in 2011, the international oil market as a whole showed the characteristics of slightly lower supply than demand and high oil price shocks. Influenced by the turmoil in central and northeast Africa, the Japan earthquake, and the Iranian nuclear issue, the international oil price has generally risen. The average price of Brent crude oil in the North Sea was US$111.27 per barrel, an increase of US$31.80/barrel or an increase of approximately 40%. It was the highest record ever since the birth of the world industry in 1859.

However, the rapid rise in international oil prices did not allow the increased revenue to fall into the pockets of the three major oils. According to the annual report, the expenditure on special oil proceeds from the three major oils last year reached 139.2 billion yuan.

The special oil proceeds are called “oil profits tax” and the system was established in March 2006. It refers to the country's proceeds from the sale of domestically-produced crude oil by oil-producing enterprises on a pro-rata basis for the excess income derived from the price exceeding a certain level. In January of this year, the state announced that the threshold for special oil proceeds from crude oil was raised from US$40 a barrel to US$55, and began to be traced back in November of last year.

Zhou Jiping, president of CNPC, said at a performance briefing yesterday that according to the current oil price forecast, the increase in the cut-off point will reduce the company’s windfall profits tax by 26 billion yuan this year.

According to analysts in the industry, the reason why it was traced back to November 1 last year was that a large part of the reason was to offset the impact of resource tax reform and promotion. According to Zhou Jiping, after the nationwide promotion of the resource tax reform, the company increased its resource tax by 2.6 billion yuan. The impact of China's promotion of resource tax reform across the country on oil companies is November and December.

Sinopec’s refining and refining business is based on annual reports. In the past year, Sinopec and Sinopec’s refining profits have turned negative. However, it is worth noting that PetroChina's crude oil processing scale is about 133 million tons, Sinopec's is 217 million tons, nearly twice the number of the former. However, it is reflected in profits: PetroChina’s loss is close to double that of Sinopec.

The industry sources told the Morning Post reporter that a large part of the reason is that Sinopec crude oil processing mainly comes from imports, and its production area is mostly the Middle East. Its affiliated benchmark oil prices are relatively low, while PetroChina's crude oil processing is mainly Daqing crude oil, with higher prices.

Zhou Jiping, president of CNPC, said yesterday that the source of oil is an important aspect of the cost of refining, and that the choice of oil is related to the adaptability of the refinery. The adaptation he refers to refers to the fact that the refinery needs to determine the nature of the oil source when it is built. Once it is completed, the oil source should not be changed.

A technical person at Sinopec Jinling Branch stated that “in the case of rising international oil prices, deep processing of inferior crude oil will earn about 100 yuan per ton more than processing regular crude oil.”

Zhou Jiping said that CNPC has stepped up reconstruction and expansion in this area. For example, the expansion of the second phase of the refinery in Guangxi is to more adapt and receive the Middle East, such as Oman High* Oil.

Zhou Jiping, an overseas oil smuggler, also said yesterday that China has raised oil prices twice this year, which has played an important role in reducing the company’s oil refining business losses. "In the first quarter of this year, PetroChina lost money in refining and it has been further improved." But he still believes that domestic refined oil prices have not been adjusted. Zhou Jiping said that the mainland recently raised the price of refined oil products on March 20, when the price of crude oil corresponding to the three places was 124 US dollars per barrel, and the adjusted price was equivalent to 110 US dollars per barrel. "There are still 14 US dollars that have not been adjusted."

In fact, at higher oil prices, the National Development and Reform Commission will consider lowering the adjustment rate. So now the price of refined oil in China has a big price difference compared with foreign countries. According to an oil industry insider, the smuggling of refined oil from China to overseas also began to pick up.

According to the information provided by CBI, under the premise of an increase of 600 yuan per ton, China smuggled refined oil to overseas, diesel can benefit 297 yuan per ton, and gasoline can benefit 328 yuan. Before the price adjustment was 810 yuan for diesel and 871 yuan for gasoline.