SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF
THE SECURITIES EXCHANGE ACT OF 1934
For the month of October 2008
PETROCHINA COMPANY LIMITED
16 ANDELU, DONGCHENG DISTRICT
BEIJING, THE PEOPLE'S REPUBLIC OF CHINA, 100011
(Address of Principal Executive Offices)
(Indicate by check mark whether the registrant files or will file annual
reports under cover of Form 20-F or Form 40-F.)
Form 20-F X Form 40-F
--- ---
(Indicate by check mark whether the registrant by furnishing the
information contained in this Form is also thereby furnishing the information to
the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of
1934.)
Yes No X
--- ---
(If "Yes" is marked, indicate below the file number assigned to the
registrant in connection with Rule 12g3-2(b): 82- )
-------
PetroChina Company Limited (the "Registrant") is furnishing under the cover
of Form 6-K the Registrant's announcement with respect to the third quarterly
report of 2008.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this announcement to be signed on its behalf by the
undersigned, thereunto duly authorized.
PetroChina Company Limited
Dated: October 30, 2008 By: /s/ Li Huaiqi
------------------------------
Name: Li Huaiqi
Title: Company Secretary
(PETROCHINA LETTERHEAD)
(CHINESE CHARACTERS)
PETROCHINA COMPANY LIMITED
(A joint stock limited company incorporated in
the People's Republic of China with limited liability)
(Shanghai Stock Exchange Stock Code: 601857;
Hong Kong Stock Exchange Stock Code: 857)
ANNOUNCEMENT
THIRD QUARTERLY REPORT OF 2008
(SECTION 1) IMPORTANT NOTICE
1.1 The Board of Directors of PetroChina Company Limited (the "Company"), the
Supervisory Committee and the Directors, Supervisors and Senior Management of
the Company warrant that there are no material omissions from, or
misrepresentation or misleading statements contained in this announcement, and
jointly and severally accept full responsibility for the truthfulness, accuracy
and completeness of the information contained in this announcement.
1.2 This announcement has been approved unanimously at the extraordinary meeting
of the Board of Directors of the Company (the "Board"). No Director has any
doubt as to, or the inability to warrant, the truthfulness, accuracy and
completeness of the third quarterly results set out in this announcement.
1.3 The financial statements of the Company and its subsidiaries (the "Group")
are prepared in accordance with China Accounting Standards ("CAS") and
International Financial Reporting Standards ("IFRS"), respectively. The
financial statements set out in this announcement have not been audited.
1.4 Mr. Jiang Jiemin, Chairman of the Board, Mr. Zhou Jiping, Vice-Chairman of
the Board and President of the Company, and Mr. Zhou Mingchun, Chief Financial
Officer and Head of the Finance Department of the Company, warrant the
truthfulness and completeness of the financial statements set out in this
announcement.
1
(SECTION 2) BASIC INFORMATION OF THE COMPANY
2.1 Summary of Accounting Data and Financial Indicators
2.1.1 Key Accounting Data and Financial Indicators Prepared under IFRS
Unit: RMB Million
AS AT THE END AS AT THE
OF THE END OF THE
REPORTING PRECEDING CHANGES FROM THE END OF THE
ITEMS PERIOD YEAR PRECEDING YEAR-END (%)
Total assets 1,187,802 1,060,131 12.0
Equity attributable to equity
holders of the Company 797,108 733,405 8.7
Net assets per share
attributable to equity holders
of the Company (RMB) 4.36 4.01 8.7
FROM THE BEGINNING OF THE CHANGES OVER THE SAME
YEAR TO THE END OF THE PERIOD OF THE PRECEDING YEAR
REPORTING PERIOD (%)
Net cash flows from operating
activities 145,843 (11.7)
Net cash flows from operating
activities per share (RMB) 0.80 (13.0)
FOR THREE MONTHS FOR NINE MONTHS
ENDED SEPTEMBER 30 ENDED SEPTEMBER 30
(JULY-SEPTEMBER) (JANUARY-SEPTEMBER)
CHANGES CHANGES
ITEMS 2008 2007 (%) 2008 2007 (%)
Net profit attributable to
equity holders of the Company 39,885 30,703 29.9 93,500 112,533 (16.9)
Basic earnings per share (RMB) 0.22 0.17 29.4 0.51 0.63 (19.0)
Diluted earnings per share (RMB) 0.22 0.17 29.4 0.51 0.63 (19.0)
Return on net assets (%) 5.0 4.8 0.2 11.7 17.7 (6.0
percentage percentage
points points)
2
2.1.2 Key Accounting Data and Financial Indicators Prepared under CAS
Unit: RMB Million
AS AT THE END AS AT THE END
OF THE OF THE CHANGES FROM THE END OF
REPORTING PRECEDING THE PRECEDING YEAR-END
ITEMS PERIOD YEAR (%)
Total assets 1,122,651 994,092 12.9
Equity attributable to equity
holders of the Company 734,380 677,367 8.4
Net assets per share
attributable to equity
holders of the Company
(RMB) 4.01 3.70 8.4
FROM THE BEGINNING OF THE CHANGES OVER THE SAME
YEAR TO THE END OF THE PERIOD OF THE PRECEDING YEAR
REPORTING PERIOD (%)
Net cash flows from operating
activities 149,863 (11.0)
Net cash flows from operating
activities per share (RMB) 0.82 (12.8)
FROM THE BEGINNING OF THE
YEAR TO THE END OF THE
REPORTING PERIOD REPORTING PERIOD
(JULY-SEPTEMBER) (JANUARY-SEPTEMBER)
CHANGES OVER CHANGES OVER
THE SAME THE SAME
PERIOD OF THE PERIOD OF THE
PRECEDING YEAR PRECEDING YEAR
ITEMS 2008 2007 (%) 2008 2007 (%)
Net profit attributable to
equity holders of the Company 38,247 29,014 31.8 86,602 104,896 (17.4)
Basic earnings per share (RMB) 0.21 0.16 31.3 0.47 0.59 (20.3)
Diluted earnings per share (RMB) 0.21 0.16 31.3 0.47 0.59 (20.3)
0.2 percentage (6.2 percentage
Return on net assets (%) 5.2 5.0 points 11.8 18.0 pints)
Return on net assets after
deducting non-recurring (0.7 percentage (7.4 percentage
profit/loss items (%) 4.4 5.1 points) 10.8 18.2 points)
3
Unit: RMB Million
FROM THE BEGINNING OF THE YEAR TO
THE END OF THE REPORTING PERIOD
NON-RECURRING PROFIT/LOSS ITEMS (PROFIT)/LOSS
Loss on disposal of non-current assets 1,033
Government grants (13,230)
Other non-operating net income and expenses 2,717
Tax effect of non-recurring profit/loss items 2,603
Total (6,877)
-------
Of which: Non-recurring profit/loss affecting net
profit of the Company's equity holders (7,495)
Non-recurring profit/loss affecting
net profit of minority interest 618
2.1.3 Differences between CAS and IFRS
Unit: RMB Million
FOR NINE MONTHS ENDED SEPTEMBER 30
ITEMS CAS IFRS
Net profit (including minority interest) 98,679 105,964
Equity (including minority interest) 785,254 853,284
Analysis of differences See appendix for details
4
2.2 Number of Shareholders and Top Ten Shareholders Holding Shares Without
Selling Restrictions at the End of the Reporting Period
Number of shareholders at the end of the 1,879,663 shareholders including 1,873,699 holders of A
reporting period shares and 5,964 holders of H shares (including 300
holders of the American Depository Shares)
Top ten shareholders holding shares without selling restrictions
NAME OF SHAREHOLDERS QUANTITY OF TRADABLE SHARES IN TYPE OF SHARES
POSSESSION AS AT THE END OF THE
REPORTING PERIOD (SHARE)
1.HKSCC Nominees Limited 20,916,286,805 H Share
2.China National Petroleum Corporation ("CNPC") 62,997,000 A Share
3.Industrial and Commercial Bank of
China-Shanghai 50 Index ETF Securities
Investment Fund 50,049,427 A Share
4.Bank of Communications-Yi Fang Da 50 Index
Securities Investment Fund 45,712,726 A Share
5.Bank of China-Shanghai and Shenzhen 300
Index Jiashi Securities Investment Fund 29,096,416 A Share
6.China Life Insurance (Group) Company
-Traditional-Ordinary Insurance Product 18,926,950 A Share
7.China Life Insurance Company
Limited-Traditional-Ordinary Insurance
Product-005L-CT001 Shanghai 18,771,597 A Share
8.China Life Insurance Company
Limited-Dividends-Personal
Dividends-005L-FH002 Shanghai 15,519,708 A Share
9.CSIC Finance Co. Ltd. 15,200,000 A Share
10.Bank of Communications- Yi Fang Da Ke Xun
Equity Securities Investment Fund 15,000,110 A Share
2.3 Review of Results of Operations
The PRC economy maintained rapid growth during the first three quarters of 2008,
with an increase in GDP of 9.9%. International crude oil prices fluctuated
widely due to a variety of factors. At the end of the third quarter of 2008, the
financial turmoil in the United States sparked a sharp decrease in international
crude oil prices. Prices of domestic chemical products were also on the decline,
reflecting the impacts of increased imports and the financial turmoil. Faced
with the changes in the operating environment, the Company planned in a
scientific manner and responded actively, and achieved stable productions and
operations and further enhanced the sustainable development of the Group.
Excluding the impact resulting from policy factors such as the special levy on
domestic crude oil sales and the macro-economic controls on the prices of
refined products, the efficacy of the Company's operation continues to maintain
at a higher level.
5
In respect of exploration and production, the Group carried out exploration at
the key basins and focused on key exploration projects, enhanced the exploration
of mature oilfields, ventured into the exploration of new oilfields actively and
emphasized the use of new technologies. Significant progress was achieved and a
solid foundation has been built for the growth of reserves for the whole of
2008. The Group actively adopted new methods in the exploration of oil and gas
fields, realised overall discovery and development of new oilfields, and fully
activated secondary recovery of mature oilfields. The Group also actively
applied technologies such as horizontal drilling, organized scientific research
and conducted production in the oil and gas fields in a safe, steady and orderly
manner. As a result, the Group has achieved a steady growth in crude oil output
and rapid growth in natural gas output. During the first three quarters of 2008,
the crude oil output of the Group was 653 million barrels and the marketable
natural gas output was 1,368.1 billion cubic feet, representing an increase of
2.8% and 16.3% from the same period in 2007, respectively.
Faced with changing demand in the market, the Group organised refining process
and chemical production meticulously. The Group also scientifically modified
refining arrangements, adopted strict cost control measures to protect against
market fluctuations and placed emphasis on production safety and environmental
protection. As a result, safe and steady production of the Group's refining and
chemical business was achieved. In respect of the sales of refined products, the
Group strived to overcome the adverse impacts resulting from domestic refined
product prices being lower than those in the international markets and natural
disasters including cold weather and snow storms in southern areas and
earthquakes in Sichuan, performed our social responsibilities conscientiously,
modified our sales structure and strengthened our operation and management. The
Group has continued to enhance the level of retail sales management and the
quality of services. Efforts were made to ensure steady market supply.
Development and optimization of our refined products sales network were promoted
actively, and marketing quality was improved. These measures further improved
the operating efficiency of the Group. During the first three quarters of 2008,
the Group's refineries processed 643 million barrels of crude oil, representing
an increase of 5.1% from the same period in 2007, produced 55.597 million tonnes
of gasoline, diesel and kerosene, representing an increase of 4.6% from the same
period in 2007, and sold 70.250 million tonnes of gasoline, diesel and kerosene,
representing an increase of 9.3% from the same period in 2007.
The Group further kept the production in the chemical and marketing segment
under control and achieved large scale, efficient, safe and steady operation.
Key technological and economic indicators improved continuously and the
allocation of resources and product mix were further optimized. During the first
three quarters of 2008, the Group produced 3.031 million tonnes of synthetic
resin, representing an increase of 4.7% from the same period in 2007, and
produced 1.982 million tonnes of ethylene, representing an increase of 4.8% from
the same period in 2007.
The development of key pipeline construction projects including the Second
West-East Pipeline project and the Lanzhou-Zhengzhou-Changsha Refined Products
Pipeline project were on schedule. The transportation of oil and natural gas has
been conducted in a safe, steady and orderly manner. Natural gas sales continue
to increase rapidly.
The Group speeded up the international operations and continued to expand the
scale of its international business. Oil and natural gas output from
international operations continued to grow. The Group has further enhanced its
international trading business and the trading volume and revenue increased
rapidly.
6
SUMMARY OF KEY OPERATING DATA FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2008
CHANGES
OVER THE
SAME
NINE MONTHS ENDED PERIOD OF
SEPTEMBER 30, 2007
OPERATING DATA UNIT 2008 2007 (%)
Crude oil output Million barrels 652.6 634.9 2.8
Marketable natural gas output Billion cubic feet 1,368.1 1,176.1 16.3
Oil and natural gas equivalent output Million barrels 880.7 831.0 6.0
Average realised price for crude oil USD/barrel 97.24 60.93 59.6
Average realised price for natural gas USD/thousand cubic
feet 3.44 2.55 34.9
Processed crude oil Million barrels 642.5 611.4 5.1
Output of refined products Thousand tonnes 55,597 53,133 4.6
Of which: Gasoline Thousand tonnes 17,707 16,104 10.0
Kerosene Thousand tonnes 1,756 1,528 14.9
Diesel Thousand tonnes 36,134 35,501 1.8
Total sales volume of refined products Thousand tonnes 70,250 64,279 9.3
Output of key chemical products
Ethylene Thousand tonnes 1,982 1,892 4.8
Synthetic resin Thousand tonnes 3,031 2,896 4.7
Synthetic fiber raw materials and
polymer Thousand tonnes 1,271 1,104 15.1
Synthetic rubber Thousand tonnes 251 233 7.7
Urea Thousand tonnes 2,868 2,796 2.6
(SECTION 3) SIGNIFICANT EVENTS
3.1 Significant changes in key accounting items and financial indicators under
CAS and explanation of such changes
v Applicable [] Inapplicable
7
Unit: RMB Million
As at December 31, Changes
Items As at September 30, 2008 2007 (%)
Accounts receivable 27,489 18,419 49.2
Advances to suppliers 65,186 20,386 219.8
Construction in progress 162,676 105,634 54.0
Deferred tax assets 19,090 12,871 48.3
Short-term borrowings 28,466 18,734 51.9
Advances from customers 16,788 12,433 35.0
Other payables 42,760 17,849 139.6
Current portion of non-current 7,973 11,652 (31.6)
liabilities
Items For nine months ended September 30, Changes
2008 2007 (%)
Operating income 853,658 598,616 42.6
Cost of sales (552,395) (347,506) 59.0
Tax and levies on operations (98,083) (45,680) 114.7
General and administrative (44,319) (33,051) 34.1
expenses
Asset impairment losses (13,033) 2,332 658.9
Investment income 6,145 4,123 49.0
Non-operating income 14,725 1,864 690.0
Net profit attributable to
minority interest 12,077 6,109 97.7
Net cash flows used for (26,884) (71,505) (62.4)
financing activities
EXPLANATION OF SIGNIFICANT CHANGES:
The increase in accounts receivable was mainly due to the expansion of the scale
of the Group's operations and the increase in sales income.
The increase in advances to suppliers was mainly due to increased investment
expenditure and the increases in the prices of raw materials and other supplies.
The increase in construction in progress was mainly due to the implementation of
projects which were within the planned annual investment of the Group.
The increase in deferred tax assets was mainly due to the provision for assets
impairment recorded for this period by the Group.
8
The increase in short-term borrowings was mainly due to the additional loans
undertaken to meet the needs of the Group's operations.
The increase in advances from customers was mainly due to more customers
purchasing refined products by advance payment.
The increase in other payables was mainly due to increase in liabilities
incurred during the period and increases in the accrual for safety fund.
The decrease in the current portion of non-current liabilities was mainly due to
the long-term borrowings becoming due within a year being offset by the
repayment of the current portion of non-current liabilities.
The increase in operating income was mainly due to increases in selling prices
and increases of sales volume of major products of the Group.
The increase in cost of sales was mainly due to an increase in the purchase
prices of crude oil, feedstock oil and other raw materials from external
suppliers as well as an expansion in the scale of production of the Group.
The increase in tax and levies on operations was mainly due to increases in the
payment of the special levy on the sale of domestic crude oil by the Group.
The increase in general and administrative expenses was mainly due to increase
in the research and development expenditure incurred by the Group and increase
in the provision for the employee benefit expenses resulting from pension
contributions for this period.
The increase in asset impairment losses was mainly due to the recording of
provision for assets impairment for this period by the Group.
The increase in investment income was mainly due to the increased income from
joint controlled entities and associates.
The increase of non-operating income was mainly due to receipt of government
grants as a result of the implementation of the financial support measures by
the PRC government to ensure supply of crude oil and refined products in the
market.
The increase in the net profit attributable to minority interest was mainly due
to the increase in profit of the subsidiaries of the Company.
The decrease in net cash flows used for financing activities was mainly due to
the reduction of dividends paid to the shareholders of the Company.
3.2 Significant events and their impacts as well as the analysis of and
explanation for the solutions
v Applicable [] Inapplicable
9
1. DISTRIBUTION OF INTERIM DIVIDEND FOR THE YEAR 2008
In accordance with the Articles of Association of PetroChina Company
Limited and as approved by the second meeting of the Fourth Session of the
Board, the Company paid an interim dividend of RMB0.131827 per share (inclusive
of tax) for the six months ended June 30, 2008 to all equity holders whose names
appear on the register of members of the Company at the close of business on
September 18, 2008. The aggregated cash dividends were approximately RMB 24,127
million. The interim dividend for the year 2008 was paid to the equity holders
above-mentioned on October 16, 2008.
2. INCREASE IN SHAREHOLDINGS OF THE COMPANY BY THE CONTROLLING SHAREHOLDER
On September 22, 2008, CNPC increased its shareholdings in the Company by
60,000,000 shares via the trading system of the Shanghai Stock Exchange. CNPC
intends to continue to increase its shareholdings in the Company, either in its
own name or through parties acting in concert with it, through the secondary
market within 12 months from the date of this share acquisition for an
aggregated amount not exceeding 2% of the total share capital of the Company
(including the shares in this share acquisition) (hereinafter referred to as
"Further Acquisition Plan"). Details for this share acquisition and the Further
Acquisition Plan were announced on September 23, 2008 via the websites of
Shanghai Stock Exchange and The Stock Exchange of Hong Kong Limited.
3.3 Status of fulfillment of commitment made by the Company, shareholders and
ultimate controller
v Applicable [] Inapplicable
1. As at the end of the reporting period, the undertakings given by CNPC under
the Restructuring Agreement and the Non-Competition Agreement entered into
between CNPC and the Company both on March 10, 2000 and the 36-month share
lock-up undertakings given by CNPC in connection with the initial listing of the
Company's A shares on the Shanghai Stock Exchange have been performed in
accordance with the manner as disclosed in the section headed "Performance of
Commitments" of the 2007 annual report of the Company and the performance of the
above undertakings has not been affected.
2. On September 22, 2008, CNPC increased its shareholdings in the Company by
60,000,000 shares via the trading system of the Shanghai Stock Exchange. CNPC
intends to continue to implement the Further Acquisition Plan within 12 months
from the date of this share acquisition. CNPC further undertakes that it will
not sell any shares it held in the Company during the period of the
implementation of the Further Acquisition Plan and within the statutory period.
As at the end of the reporting period, CNPC has not violated the above
undertakings.
3.4 Caution and explanation as to the anticipated loss of accumulated net
profits from the beginning of the year to the end of the next reporting
period or significant changes over the same period of the preceding year
[] Applicable v Inapplicable
10
3.5 Investments in securities
[] Applicable v Inapplicable
3.6 This announcement is published in English and Chinese. In the event of any
inconsistency between the two versions, the Chinese version shall prevail.
By Order of the Board of Directors
PetroChina Company Limited
Jiang Jiemin
Chairman
Beijing, the PRC
October 29, 2008
As at the date of this announcement, the Board of Directors comprises Mr Jiang
Jiemin as the Chairman; Mr Zhou Jiping (Vice Chairman) and Mr Liao Yongyuan as
executive Directors; Mr Wang Yilin, Mr Zeng Yukang, Mr Wang Fucheng, Mr Li
Xinhua, Mr Wang Guoliang and Mr Jiang Fan as non-executive Directors; and Mr
Chee-Chen Tung, Mr Liu Hongru, Mr Franco Bernabe, Mr Li Yongwu and Mr Cui Junhui
as independent non-executive Directors.
11
APPENDIX
A. FINANCIAL STATEMENTS FOR THE THIRD QUARTER OF 2008 PREPARED IN ACCORDANCE
WITH IFRS
1-1. CONSOLIDATED PROFIT AND LOSS ACCOUNT
Three months ended September 30
2008 2007
RMB RMB
Million Million
TURNOVER 304,136 205,890
-------- --------
OPERATING EXPENSES
Purchases, services and other (160,081) (94,814)
Employee compensation costs (14,548) (12,238)
Exploration expenses, including exploratory
dry holes (6,171) (5,486)
Depreciation, depletion and amortisation (21,491) (16,354)
Selling, general and administrative expenses (16,613) (14,313)
Taxes other than income taxes (38,232) (19,980)
Other income / (expenses), net 7,721 (1,352)
-------- --------
TOTAL OPERATING EXPENSES (249,415) (164,537)
-------- --------
PROFIT FROM OPERATIONS 54,721 41,353
-------- --------
FINANCE COSTS
Exchange gain 277 465
Exchange loss (299) (717)
Interest income 201 409
Interest expense (509) (693)
-------- --------
TOTAL NET FINANCE COSTS (330) (536)
-------- --------
SHARE OF PROFIT OF ASSOCIATES AND JOINTLY
CONTROLLED ENTITIES 1,829 1,680
-------- --------
PROFIT BEFORE TAXATION 56,220 42,497
TAXATION (11,110) (9,193)
-------- --------
PROFIT FOR THE PERIOD 45,110 33,304
======== ========
ATTRIBUTABLE TO:
Equity holders of the Company 39,885 30,703
Minority interest 5,225 2,601
-------- --------
45,110 33,304
======== ========
BASIC AND DILUTED EARNINGS PER SHARE FOR PROFIT
ATTRIBUTABLE TO EQUITY HOLDERS OF THE
COMPANY (RMB) 0.22 0.17
======== ========
-------------------- ----------------- ------------------------
Chairman President Chief Financial Officer
Jiang Jiemin Zhou Jiping Zhou Mingchun
12
1-2. CONSOLIDATED PROFIT AND LOSS ACCOUNT
Nine months ended September 30
2008 2007
RMB RMB
Million Million
TURNOVER 853,658 598,616
-------- --------
OPERATING EXPENSES
Purchases, services and other (454,603) (261,809)
Employee compensation costs (44,959) (34,664)
Exploration expenses, including exploratory
dry holes (19,019) (16,093)
Depreciation, depletion and amortisation (64,245) (47,582)
Selling, general and administrative expenses (44,606) (38,214)
Taxes other than income taxes (104,063) (48,764)
Other income / (expenses), net 10,322 (1,007)
-------- --------
TOTAL OPERATING EXPENSES (721,173) (448,133)
-------- --------
PROFIT FROM OPERATIONS 132,485 150,483
-------- --------
FINANCE COSTS
Exchange gain 1,581 1,046
Exchange loss (2,631) (1,640)
Interest income 1,605 1,228
Interest expense (2,144) (2,743)
-------- --------
TOTAL NET FINANCE COSTS (1,589) (2,109)
-------- --------
SHARE OF PROFIT OF ASSOCIATES AND JOINTLY
CONTROLLED ENTITIES 6,036 4,465
-------- --------
PROFIT BEFORE TAXATION 136,932 152,839
TAXATION (30,968) (33,219)
-------- --------
PROFIT FOR THE PERIOD 105,964 119,620
======== ========
ATTRIBUTABLE TO:
Equity holders of the Company 93,500 112,533
Minority interest 12,464 7,087
-------- --------
105,964 119,620
======== ========
BASIC AND DILUTED EARNINGS PER SHARE FOR PROFIT
ATTRIBUTABLE TO EQUITY HOLDERS OF THE
COMPANY (RMB) 0.51 0.63
======== ========
-------------------- ----------------- ------------------------
Chairman President Chief Financial Officer
Jiang Jiemin Zhou Jiping Zhou Mingchun
13
2. CONSOLIDATED BALANCE SHEET
September 30, December 31,
2008 2007
RMB RMB
Million Million
NON CURRENT ASSETS
Property, plant and equipment 810,882 762,882
Investments in associates and jointly controlled
entities 30,421 26,535
Available-for-sale financial assets 2,127 2,581
Advance operating lease payments 24,798 23,417
Intangible and other assets 9,362 8,488
Time deposits with maturities over one year 3,143 5,053
------- -------
TOTAL NON CURRENT ASSETS 880,733 828,956
------- -------
CURRENT ASSETS
Inventories 110,878 88,467
Accounts receivable 27,489 18,419
Prepaid expenses and other current assets 80,511 36,018
Notes receivable 5,633 4,735
Time deposits with maturities over three months
but within one year 13,661 18,042
Cash and cash equivalents 68,897 65,494
------- -------
TOTAL CURRENT ASSETS 307,069 231,175
------- -------
CURRENT LIABILITIES
Accounts payable and accrued liabilities 195,416 144,353
Income tax payable 2,609 11,709
Other taxes payable 18,665 11,099
Short-term borrowings 36,439 30,934
------- -------
TOTAL CURRENT LIABILITIES 253,129 198,095
------- -------
NET CURRENT ASSETS/(LIABILITIES) 53,940 33,080
------- -------
TOTAL ASSETS LESS CURRENT LIABILITIES 934,673 862,036
======= =======
14
2. CONSOLIDATED BALANCE SHEET (CONTINUED)
September 30, December 31,
2008 2007
RMB RMB
Million Million
EQUITY
Equity attributable to equity holders of the
Company:
Share capital 183,021 183,021
Retained earnings 397,224 332,432
Reserves 216,863 217,952
------- -------
797,108 733,405
Minority interest 56,176 42,942
------- -------
TOTAL EQUITY 853,284 776,347
------- -------
NON CURRENT LIABILITIES
Long-term borrowings 35,145 39,688
Asset retirement obligations 26,569 24,761
Deferred taxation 18,695 20,205
Other long-term obligations 980 1,035
------- -------
TOTAL NON CURRENT LIABILITIES 81,389 85,689
------- -------
TOTAL EQUITY AND NON CURRENT LIABILITIES 934,673 862,036
======= =======
-------------------- ----------------- ------------------------
Chairman President Chief Financial Officer
Jiang Jiemin Zhou Jiping Zhou Mingchun
15
3. CONSOLIDATED CASH FLOW STATEMENT
Nine months ended September 30
2008 2007
RMB RMB
Million Million
CASH FLOWS FROM OPERATING
ACTIVITIES (A) 145,843 165,192
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures (125,519) (97,489)
Acquisition of investments in associates and jointly
controlled entities (457) (1,018)
Acquisition of available-for-sale financial assets (11) (310)
Acquisition of intangible assets (741) (534)
Acquisition of other non-current assets (1,137) (763)
Purchase of minority interest in listed subsidiaries - (149)
Purchase of minority interest in subsidiaries (176) (10)
Repayment of capital by associates and jointly controlled
entities - 3,628
Proceeds from disposal of property, plant and equipment 287 562
Proceeds from disposal of intangible and other non-current
assets 64 -
Proceeds from disposal of investments in associates and
jointly controlled entities 8 1,015
Proceeds from disposal of available-for-sale financial
assets 51 187
Dividends received 3,434 844
Decrease/ (Increase) in time deposits with maturities over
three months 5,905 (2,537)
-------- --------
NET CASH USED FOR INVESTING ACTIVITIES (118,292) (96,574)
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES
Repayments of short-term borrowings (58,351) (30,425)
Repayments of long-term borrowings (11,650) (18,177)
Dividends paid to minority interest (3,065) (1,929)
Dividends paid to equity holders of the Company (28,708) (64,517)
Increase in short-term borrowings 68,533 28,256
Increase in long-term borrowings 3,007 16,628
Capital contribution from minority interest 8,691 1,315
Capital reduction (2,420) -
Decrease in other long-term obligations (160) (83)
-------- --------
NET CASH USED FOR FINANCING ACTIVITIES (24,123) (68,932)
-------- --------
TRANSLATION OF FOREIGN CURRENCY (25) 523
-------- --------
Increase in cash and cash equivalents 3,403 209
Cash and cash equivalents at beginning of the period 65,494 48,559
-------- --------
Cash and cash equivalents at end of the period 68,897 48,768
======== ========
-------------------- ----------------- ------------------------
Chairman President Chief Financial Officer
Jiang Jiemin Zhou Jiping Zhou Mingchun
16
3. CONSOLIDATED CASH FLOW STATEMENT (CONTINUED)
(A) CASH FLOWS FROM OPERATING ACTIVITIES
Nine months ended September 30
2008 2007
RMB RMB
Million Million
PROFIT FOR THE PERIOD 105,964 119,620
Adjustments for:
Taxation 30,968 33,219
Depreciation, depletion and amortisation 64,245 47,582
Capitalised exploratory costs charged to expense 10,222 7,858
Share of profit of associates and jointly controlled
entities (6,036) (4,465)
Reversal of provision for impairment of receivables, net (25) (2,292)
Write down/(Reversal of write down) in inventories, net 5,046 (124)
Impairment of available-for-sale financial assets, net 10 -
Impairment of investments in associates and jointly
controlled entities, net 21 5
Loss on disposal of property, plant and equipment 1,326 1,574
Loss/(Gain) on disposal of investments in associates and
jointly controlled entities 3 (352)
Gain on disposal of available-for-sale financial assets (7) (94)
Dividend income (237) (94)
Interest income (1,605) (1,228)
Interest expense 2,144 2,743
Advance payments on long-term operating leases (2,845) (1,945)
Changes in working capital:
Accounts receivable and prepaid expenses and other current
assets (37,681) (27,612)
Inventories (27,457) (2,099)
Accounts payable and accrued liabilities 44,156 37,753
-------- --------
CASH GENERATED FROM OPERATIONS 188,212 210,049
Interest received 1,586 1,267
Interest paid (2,761) (2,573)
Income taxes paid (41,194) (43,551)
-------- --------
NET CASH PROVIDED BY OPERATING ACTIVITIES 145,843 165,192
======== ========
17
B. FINANCIAL STATEMENTS FOR THE THIRD QUARTER OF 2008 PREPARED IN ACCORDANCE
WITH CAS
1. CONSOLIDATED BALANCE SHEET
September 30, December 31,
2008 2007
RMB RMB
Million Million
ASSETS
CURRENT ASSETS
Cash at bank and on hand 85,701 88,589
Notes receivable 5,633 4,735
Accounts receivable 27,489 18,419
Advances to suppliers 65,186 20,386
Interest receivable 128 109
Dividends receivable 957 18
Other receivables 14,197 15,444
Inventories 110,878 88,467
Current portion of non-current assets 25 59
Other current assets 18 2
--------- ---------
TOTAL CURRENT ASSETS 310,212 236,228
--------- ---------
NON-CURRENT ASSETS
Available-for-sale financial assets 2,077 2,530
Long-term equity investments 26,924 22,686
Fixed assets 239,793 247,803
Oil and gas properties 317,740 326,328
Construction in progress 162,676 105,634
Construction materials 8,877 6,927
Fixed assets pending disposal 454 287
Intangible assets 21,326 20,022
Goodwill 148 -
Long-term prepaid expenses 12,833 12,028
Deferred tax assets 19,090 12,871
Other non-current assets 501 748
--------- ---------
TOTAL NON-CURRENT ASSETS 812,439 757,864
--------- ---------
TOTAL ASSETS 1,122,651 994,092
========= =========
18
1 CONSOLIDATED BALANCE SHEET (CONTINUED)
September 30, December 31,
2008 2007
RMB RMB
Million Million
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Short-term borrowings 28,466 18,734
Notes payable 884 1,143
Accounts payable 131,572 104,460
Advances from customers 16,788 12,433
Employee compensation payable 9,092 11,585
Taxes payable 21,274 22,808
Interest payable 263 173
Dividends payable 894 89
Other payables 42,760 17,849
Provisions 545 715
Current portion of non-current liabilities 7,973 11,652
Other current liabilities 3 13
------- -------
TOTAL CURRENT LIABILITIES 260,514 201,654
------- -------
NON-CURRENT LIABILITIES
Deferred income 183 76
Long-term borrowings 30,991 35,305
Debentures payable 4,154 4,383
Long-term payables 55 57
Grants payable 618 774
Provisions 26,569 24,761
Deferred tax liabilities 14,189 11,883
Other non-current liabilities 124 128
------- -------
TOTAL NON-CURRENT LIABILITIES 76,883 77,367
------- -------
TOTAL LIABILITIES 337,397 279,021
------- -------
19
1. CONSOLIDATED BALANCE SHEET (CONTINUED)
September 30, December 31,
2008 2007
RMB RMB
Million Million
SHAREHOLDERS' EQUITY
Share capital 183,021 183,021
Capital surplus 122,010 122,192
Surplus reserves 102,696 102,696
Undistributed profits 328,438 270,544
Currency translation differences (1,785) (1,086)
---------- ----------
EQUITY ATTRIBUTABLE TO EQUITY HOLDERS OF THE
COMPANY 734,380 677,367
---------- ----------
MINORITY INTEREST 50,874 37,704
---------- ----------
TOTAL SHAREHOLDERS' EQUITY 785,254 715,071
---------- ----------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 1,122,651 994,092
========== ==========
-------------------- ----------------- ------------------------
Chairman President Chief Financial Officer
Jiang Jiemin Zhou Jiping Zhou Mingchun
20
2. COMPANY BALANCE SHEET
September 30, December 31,
2008 2007
RMB RMB
Million Million
ASSETS
CURRENT ASSETS
Cash at bank and on hand 66,012 78,332
Notes receivable 5,168 3,988
Accounts receivable 3,822 2,131
Advances to suppliers 52,031 16,086
Interest receivable 125 109
Dividends receivable 83 85
Other receivables 18,478 24,173
Inventories 92,964 70,284
Current portion of non-current assets 24 59
Other current assets 18 2
------- -------
TOTAL CURRENT ASSETS 238,725 195,249
------- -------
NON-CURRENT ASSETS
Available-for-sale financial assets 1,060 1,456
Long-term equity investments 126,993 104,691
Fixed assets 192,660 199,411
Oil and gas properties 228,031 231,921
Construction in progress 129,947 85,597
Construction materials 7,026 5,455
Fixed assets pending disposal 446 282
Intangible assets 17,099 16,356
Long-term prepaid expenses 10,798 9,924
Deferred tax assets 13,703 9,048
------- -------
TOTAL NON-CURRENT ASSETS 727,763 664,141
------- -------
TOTAL ASSETS 966,488 859,390
======= =======
21
2 COMPANY BALANCE SHEET (CONTINUED)
September 30, December 31,
2008 2007
RMB RMB
Million Million
LIABILITIES
AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Short-term borrowings 38,477 17,898
Accounts payable 87,333 66,877
Advances from customers 13,814 10,443
Employee compensation payable 7,728 10,751
Taxes payable 2,836 13,793
Interest payable 181 61
Other payables 72,599 46,582
Provisions 61 75
Current portion of non-current liabilities 7,803 9,029
------- -------
TOTAL CURRENT LIABILITIES 230,832 175,509
------- -------
NON-CURRENT LIABILITIES
Deferred income 156 62
Long-term borrowings 23,515 29,044
Debentures payable 3,500 3,500
Long-term payables 55 56
Grants payable 563 710
Provisions 16,441 15,307
Deferred tax liabilities 7,881 6,598
Other non-current liabilities 120 123
------- -------
TOTAL NON-CURRENT LIABILITIES 52,231 55,400
------- -------
TOTAL LIABILITIES 283,063 230,909
------- -------
22
2 COMPANY BALANCE SHEET (CONTINUED)
September 30, December 31,
2008 2007
RMB RMB
Million Million
SHAREHOLDERS' EQUITY
Share capital 183,021 183,021
Capital surplus 125,678 125,848
Surplus reserves 91,596 91,596
Undistributed profits 283,130 228,016
------- -------
TOTAL SHAREHOLDERS' EQUITY 683,425 628,481
------- -------
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY 966,488 859,390
======= =======
-------------------- ----------------- ------------------------
Chairman President Chief Financial Officer
Jiang Jiemin Zhou Jiping Zhou Mingchun
23
3-1. CONSOLIDATED INCOME STATEMENTS
Three months ended September 30
2008 2007
RMB RMB
ITEMS Million Million
1.OPERATING INCOME 304,136 205,890
Less: Cost of sales (191,108) (124,366)
Tax and levies on operations (36,192) (18,827)
Selling expenses (11,746) (10,600)
General and administrative expenses (14,757) (11,576)
Finance expenses (436) (941)
Asset impairment losses (5,703) 15
Add: Investment income 1,848 1,033
-------- --------
2.OPERATING PROFIT 46,042 40,628
-------- --------
Add: Non-operating income 9,111 423
Less: Non-operating expenses (1,354) (1,403)
-------- --------
3.PROFIT BEFORE TAXATION 53,799 39,648
Less: Taxation (10,417) (8,940)
-------- --------
4.NET PROFIT 43,382 30,708
-------- --------
Net profit attributable to equity 38,247 29,014
holders of the Company
Minority interest 5,135 1,694
5.EARNINGS PER SHARE (BASED ON
NET PROFIT ATTRIBUTABLE TO EQUITY
HOLDERS OF THE COMPANY)
Basic earnings per share (RMB) 0.21 0.16
Diluted earnings per share (RMB) 0.21 0.16
======== ========
-------------------- ----------------- ------------------------
Chairman President Chief Financial Officer
Jiang Jiemin Zhou Jiping Zhou Mingchun
24
3-2. CONSOLIDATED INCOME STATEMENTS
Nine months ended September 30
2008 2007
RMB RMB
ITEMS Million Million
1.OPERATING INCOME 853,658 598,616
Less: Cost of sales (552,395) (347,506)
Tax and levies on operations (98,083) (45,680)
Selling expenses (33,322) (29,675)
General and administrative expenses (44,319) (33,051)
Finance expenses (1,884) (2,597)
Asset impairment losses (13,033) 2,332
Add: Investment income 6,145 4,123
-------- --------
2.OPERATING PROFIT 116,767 146,562
-------- --------
Add: Non-operating income 14,725 1,864
Less: Non-operating expenses (4,487) (2,484)
-------- --------
3.PROFIT BEFORE TAXATION 127,005 145,942
Less: Taxation (28,326) (34,937)
-------- --------
4.NET PROFIT 98,679 111,005
-------- --------
Net profit attributable to equity 86,602 104,896
holders of the Company
Minority interest 12,077 6,109
5.EARNINGS PER SHARE (BASED ON
NET PROFIT ATTRIBUTABLE TO EQUITY
HOLDERS OF THE COMPANY)
Basic earnings per share (RMB) 0.47 0.59
Diluted earnings per share (RMB) 0.47 0.59
======== ========
-------------------- ----------------- ------------------------
Chairman President Chief Financial Officer
Jiang Jiemin Zhou Jiping Zhou Mingchun
25
4-1. COMPANY INCOME STATEMENT
Three months ended September 30
2008 2007
RMB RMB
ITEMS Million Million
1.OPERATING INCOME 221,939 131,758
Less: Cost of sales (167,656) (89,709)
Tax and levies on operations (21,354) (11,483)
Selling expenses (9,390) (8,367)
General and administrative expenses (11,366) (8,212)
Finance expenses (375) (353)
Asset impairment losses (5,684) (4)
Add: Investment income 21,391 15,800
-------- --------
2.OPERATING PROFIT 27,505 29,430
-------- --------
Add: Non-operating income 8,270 332
Less: Non-operating expenses (1,262) (1,297)
-------- --------
3.PROFIT BEFORE TAXATION 34,513 28,465
Less: Taxation 36 519
-------- --------
4.NET PROFIT 34,549 28,984
-------- --------
5.EARNINGS PER SHARE
Basic earnings per share (RMB) 0.19 0.16
Diluted earnings per share (RMB) 0.19 0.16
======== ========
-------------------- ----------------- ------------------------
Chairman President Chief Financial Officer
Jiang Jiemin Zhou Jiping Zhou Mingchun
26
4-2. COMPANY INCOME STATEMENT
Nine months ended September 30
2008 2007
RMB RMB
ITEMS Million Million
1.OPERATING INCOME 614,954 422,149
Less: Cost of sales (478,156) (285,029)
Tax and levies on operations (58,484) (27,741)
Selling expenses (26,468) (23,416)
General and administrative expenses (34,931) (23,950)
Finance expenses (580) (1,297)
Asset impairment losses (12,999) 1,838
Add: Investment income 65,495 46,204
-------- --------
2.OPERATING PROFIT 68,831 108,758
-------- --------
Add: Non-operating income 12,876 1,188
Less: Non-operating expenses (3,028) (2,245)
-------- --------
3.PROFIT BEFORE TAXATION 78,679 107,701
Less: Taxation 5,143 (5,269)
-------- --------
4.NET PROFIT 83,822 102,432
-------- --------
5.EARNINGS PER SHARE
Basic earnings per share (RMB) 0.46 0.57
Diluted earnings per share (RMB) 0.46 0.57
======== =======
-------------------- ----------------- ------------------------
Chairman President Chief Financial Officer
Jiang Jiemin Zhou Jiping Zhou Mingchun
27
5. CONSOLIDATED CASH FLOW STATEMENT
Nine months ended September 30
2008 2007
RMB RMB
ITEMS Million Million
1. CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from sales of goods and
rendering of services 989,252 694,659
Refund of taxes and levies 9,448 722
Cash received relating to other operating
activities 2,333 508
---------- ----------
SUB-TOTAL OF CASH INFLOWS 1,001,033 695,889
---------- ----------
Cash paid for goods and services (586,800) (324,253)
Cash paid to and on behalf of employees (47,452) (32,947)
Payments of taxes and levies (188,352) (132,719)
Cash paid relating to other operating activities (28,566) (37,527)
---------- ----------
SUB-TOTAL OF CASH OUTFLOWS (851,170) (527,446)
---------- ----------
NET CASH FLOWS FROM OPERATING ACTIVITIES 149,863 168,443
---------- ----------
2. CASH FLOWS FROM INVESTING ACTIVITIES
Cash received from disposal of investments 5,964 4,830
Cash received from returns on investments 5,020 2,111
Net cash received from disposal of fixed
assets, oil and gas properties, intangible
assets and other long-term assets 351 562
---------- ----------
SUB-TOTAL OF CASH INFLOWS 11,335 7,503
---------- ----------
Cash paid to acquire fixed assets, oil and gas
properties, intangible assets and other long
term assets (130,242) (100,731)
Cash paid to acquire investments (644) (4,024)
Including: Cash paid to purchase shares of
listed subsidiaries - (149)
---------- ----------
SUB-TOTAL OF CASH OUTFLOWS (130,886) (104,755)
---------- ----------
NET CASH FLOWS USED FOR INVESTING ACTIVITIES (119,551) (97,252)
---------- ----------
28
5. CONSOLIDATED CASH FLOW STATEMENT (CONTINUED)
Nine months ended September 30
2008 2007
RMB RMB
ITEMS Million Million
3. CASH FLOWS FROM FINANCING ACTIVITIES
Cash received from capital contributions 8,691 1,315
Including: Cash received from minority
shareholders' capital contributions to
subsidiaries 8,691 1,315
Cash received from borrowings 71,540 44,884
Cash received relating to other financing
activities 44 102
-------- --------
SUB-TOTAL OF CASH INFLOWS 80,275 46,301
-------- --------
Cash repayments of borrowings (70,001) (48,602)
Cash payments for interest expenses and
distribution of dividends or profits (34,534) (69,019)
Including: Subsidiaries' cash payments
for distribution of dividends or profits
to minority shareholders (3,065) (5,220)
Capital reduction (2,420) -
Cash payments relating to other financing
activities (204) (185)
-------- --------
SUB-TOTAL OF CASH OUTFLOWS (107,159) (117,806)
-------- --------
NET CASH FLOWS USED FOR FINANCING ACTIVITIES (26,884) (71,505)
-------- --------
4. EFFECT OF FOREIGN EXCHANGE RATE CHANGES ON CASH
AND CASH EQUIVALENTS (25) 523
-------- --------
5. NET INCREASE IN CASH AND CASH
EQUIVALENTS 3,403 209
-------- --------
Add: Cash and cash equivalents at beginning of
the period 65,494 48,559
-------- --------
6. CASH AND CASH EQUIVALENTS AT END OF THE PERIOD 68,897 48,768
======== ========
-------------------- ----------------- ------------------------
Chairman President Chief Financial Officer
Jiang Jiemin Zhou Jiping Zhou Mingchun
29
6. COMPANY CASH FLOW STATEMENT
Nine months ended September 30
2008 2007
RMB RMB
ITEMS Million Million
1. CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from sales of goods and
rendering of services 740,990 493,196
Refund of taxes and levies 7,996 655
Cash received relating to other operating
activities 6,541 1,770
-------- --------
SUB-TOTAL OF CASH INFLOWS 755,527 495,621
-------- --------
Cash paid for goods and services (545,809) (277,573)
Cash paid to and on behalf of employees (37,593) (24,793)
Payments of taxes and levies (95,580) (66,778)
Cash paid relating to other operating
activities (13,080) (22,025)
-------- --------
SUB-TOTAL OF CASH OUTFLOWS (692,062) (391,169)
-------- --------
NET CASH FLOWS FROM OPERATING ACTIVITIES 63,465 104,452
-------- --------
2. CASH FLOWS FROM INVESTING ACTIVITIES
Cash received from disposal of investments 8,075 1,208
Cash received from returns on investments 66,098 42,613
Net cash received from disposal of fixed
assets, oil and gas properties, intangible
assets and other long-term assets 242 142
-------- --------
SUB-TOTAL OF CASH INFLOWS 74,415 43,963
-------- --------
Cash paid to acquire fixed assets, oil and
gas properties, intangible assets and
other long-term assets (103,989) (80,403)
Cash paid to acquire investments (22,287) (3,975)
Including: Cash paid to purchase shares of
listed subsidiaries - (149)
-------- --------
SUB-TOTAL OF CASH OUTFLOWS (126,276) (84,378)
-------- --------
NET CASH FLOWS USED FOR INVESTING ACTIVITIES (51,861) (40,415)
-------- --------
30
6. COMPANY CASH FLOW STATEMENT (CONTINUED)
Nine months ended September 30
2008 2007
RMB RMB
ITEMS Million Million
3. CASH FLOWS FROM FINANCING ACTIVITIES
Cash received from capital contributions - -
Cash received from borrowings 52,018 35,191
Cash received relating to other financing
activities 44 62
-------- --------
SUB-TOTAL OF CASH INFLOWS 52,062 35,253
-------- --------
Cash repayments of borrowings (37,406) (35,327)
Cash payments for interest expenses and
distribution of dividends or profits (30,389) (66,079)
Cash payments relating to other financing
activities (191) (96)
-------- --------
SUB-TOTAL OF CASH OUTFLOWS (67,986) (101,502)
-------- --------
NET CASH FLOWS USED FOR FINANCING ACTIVITIES (15,924) (66,249)
-------- --------
4. EFFECT OF FOREIGN EXCHANGE RATE CHANGES ON CASH
AND CASH EQUIVALENTS - -
-------- --------
5. NET (DECREASE)/INCREASE IN CASH AND CASH
EQUIVALENTS (4,320) (2,212)
-------- --------
Add: Cash and cash equivalents at beginning
of the period 60,332 45,029
-------- --------
6. CASH AND CASH EQUIVALENTS AT END OF THE PERIOD 56,012 42,817
======== ========
-------------------- ----------------- ------------------------
Chairman President Chief Financial Officer
Jiang Jiemin Zhou Jiping Zhou Mingchun
31
C. SIGNIFICANT DIFFERENCES BETWEEN CAS AND IFRS
The financial statements of the Group prepared in accordance with CAS differ in
certain material aspects from those in accordance with IFRS. A statement of
reconciliation of such differences is set out below:
Nine months ended September 30
2008 2007
Notes RMB million RMB million
Consolidated profit for the period under IFRS 105,964 119,620
Adjustments:
Depletion of oil and gas properties (1) (5,523) (6,669)
Adjustment of safety fund (2) (3,826) -
Deferred taxation (3) 2,642 (1,718)
Other (578) (228)
-------- --------
Consolidated profit for the period under CAS 98,679 111,005
======== ========
September 30, December 31,
2008 2007
Notes RMB million RMB million
Consolidated shareholders' equity under IFRS 853,284 776,347
Adjustments:
Depletion of oil and gas properties (1) (85,185) (79,662)
Adjustment of safety fund (2) (7,385) (3,559)
Currency translation differences 141 (390)
Deferred taxation (3) 23,798 21,156
Other 601 1,179
-------- --------
Consolidated shareholder's equity under CAS 785,254 715,071
======== ========
32
(1) Depletion of oil and gas properties is provided using the unit of
production method under IFRS, while the straight-line method is used under CAS.
(2) In accordance with the requirements of the "Temporary regulation for
safety fund financial management of high risk industry" issued by the Ministry
of Finance and State Administration of Work Safety of PRC, a safety fund has
been accrued for the Group's oil and gas exploration, refinery and chemical
production activities within the PRC from January 1, 2007. This safety fund has
been recognised into the Group's income statement. As the Group does not have a
specific utilisation plan for this accrued safety fund as at September 30, 2008,
it has been reversed under IFRS.
(3) Deferred taxation relating to the differences between IFRS and CAS.
33