SHANGHAI, China – PetroChina became the world’s first company worth more than $1 trillion on Monday, surging past Exxon Mobil as the Chinese oil producer’s shares nearly tripled in their first day of trading in China.
State-owned PetroChina Co., a unit of state-owned China National Petroleum Corp., is the country’s biggest oil and gas producer. Its Shanghai initial public offering of 4 billion shares raised $8.94 billion — a record for a mainland bourse.
Adding the value of PetroChina shares traded in Shanghai, Hong Kong and New York — and those still owned by the government — the company’s total market capitalization ballooned to just over $1 trillion, compared to Exxon Mobil Corp.’s $488 billion.
PetroChina was established as a joint stock company with limited liabilities under the Company Law of the People’s Republic of China (the PRC) on November 5, 1999, as part of the restructuring of CNPC. In the restructuring, CNPC injected into PetroChina most of the assets and liabilities of CNPC relating to its exploration and production, refining and marketing, chemicals and natural gas businesses.
Although PetroChina is the most profitable company in Asia, this success is not the result of corporate management, but due to its duopoly on the wholesale and retail business of oil products with Sinopec in China. If the present high oil price continues in China, PetroChina might prolong its success.
Because of its link to Sudan through parent company CNPC, several institutional investors such as Harvard and Yale decided, in 2005, to divest from Sinopec. Sudan divestment efforts have continued to be concentrated on PetroChina since then. Fidelity, after pressure from activist groups, also announced in a filing in the US that it had sold 91 per cent of its American Depositary Receipts in PetroChina in the first quarter of 2007.
At the beginning of May 2007, the company announced it had made China’s largest oil find for a decade off the country’s north east coast, in an oilfield named Jidong Nanpu.
Here’s the issue: Activists wrote in an article that the Chinese government, a majority owner of PetroChina, also does business with the Sudanese government. To make a tragic story short, the Sudanese government has engaged in acts of genocide, and an estimated 200,000-450,000 people have died, with an estimated 2.5 million people displaced from their homes.
Holocaust survivor Elie Wiesel said in a speech regarding the Darfur genocide:
Scores of women are being raped every day; children are dying of disease, hunger, and violence.
How can a citizen of a free country not pay attention? How can anyone, anywhere not feel outraged? How can a person, whether religious or secular, not be moved by compassion? And above all, how can anyone who remembers remain silent?
Similar concerns have fueled opposition to PetroChina’ s construction of a pipeline from Tibet. According to the International Campaign for Tibet, the planned pipeline from Sebei to Lanhou will harm the Tibetan environment, facilitate the transfer of Chinese settlers into Tibet and further consolidate China’s military and economic grip on Tibet. The Tibetan Government in Exile, headed by the Dalai Lama, has called for an immediate halt to the construction of the pipeline. BP Amoco has ruled out any direct participation in projects on the Tibetan plateau. However, the British Oil Company has resisted calls for it to use its influence with PetroChina to address these political and environmental concerns.
This is a state run business – so it’s busy directly funding the Chinese military
PetroChina is totally kicking Exxon’s a** on labor costs… Just assuming they actually pay their employees (as prisoners are forced to work as well as employees being found to be forced to work for free).
An average Chinese wage of $0.57 per hour — or $104 per month — is about 3 percent of the average U.S. manufacturing worker’s wage, according to data collected by Banister. “Equally as striking, regional competitors in the newly industrialized economies of Asia had, on average, manufacturing labor costs more than 10 times those for China’s manufacturing workers, and Mexico and Brazil had manufacturing labor costs about four times those for China’s manufacturing employees.”
The average hourly wage for a worker in a rural setting was $0.41 per hour, and migrant workers are making even less than that.