Oil giant to wrap up key reforms by Nov

Updated 2017-08-15 11:48:44 China Daily
A worker from China National Petroleum Corp checks the figures on a gauge. (ZHONG MIN / FOR CHINA DAILY)

A worker from China National Petroleum Corp checks the figures on a gauge. (ZHONG MIN / FOR CHINA DAILY)

State-owned oil and gas producer and explorer China National Petroleum Corp vowed on Monday that it would complete important internal corporate reforms by November, which would make it more streamlined, efficient and market-focused.

The Beijing-headquartered national energy behemoth said in a statement that the process was being supervised by a specific team within the corporation, which had set forward areas of responsibility, as well as an operational program and schedule.

The CNPC changes are part of wider SOE reforms being directly administered by the State-owned Assets Supervision and Administration Commission, the country's top SOE regulator.

Xu Wenrong, deputy general manager of CNPC, said the reforms would be completed on schedule, adding that the new structure would help clear what he called institutional barriers and enhance the company's operational efficiency.

According to the oil giant, the reforms will help create effective corporate governance and an efficient management structure in the largest integrated energy company in China.

The State Council, China's cabinet, issued an action plan last month in which it ordered the country's major State-owned enterprises to complete corporate reforms by the end of 2017.

The reforms, targeting SOEs supervised by the central government, excluding financial and cultural enterprises, will separate the government from business operations by restructuring SOEs into limited liability companies or corporations.

Analysts said on Monday they believed that the initiative in the CNPC would see an improved market focus and a more flexible company, making it more vigorous and competitive in the global marketplace.

The Research Director of energy sector consultancy ICIS China, Li Li, said that the reforms would push the corporation into becoming more market-focused and flexible.

The energy giant has been speeding up company-level reforms in recent years in order to further open up the country's energy markets.

It vowed to achieve a market-based pricing system in three years and also said last year it would restructure its natural gas sales and pipeline side, to establish five individual natural gas sales companies responsible for all pipeline-related operations.

CNPC Chairman Wang Yilin said earlier that mixed ownership would be a significant breakthrough in the company.

"The reforms toward a market-oriented economy will help the company improve its products, pricing mechanisms and services," Wang added.

"We will establish a market and benefit-centered investment, budget and assessment system."

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