Exxon Mobil, which traces its roots to Rockefeller’s Standard Oil company of the 19th century, is no longer the world’s largest publicly traded producer of oil. Last week PetroChina gained that distinction when it announced that it pumped 2.4 million barrels a day in 2011, topping Exxon Mobil’s output by 100,000.
While it is a publicly traded company, PetroChina is 86%-owned by the Chinese government, a government whose major priority in the energy market seems to be securing as much oil reserves and oil production as it can lay it hands on. While some Western oil companies have eased back on production to preserve hydrocarbon assets while still making strong returns in a high-oil-price environment, PetroChina does not seem to have that luxury.
In adding to ramping up production in China’s aging oil fields, PetroChina has been laying out cash ($7 billion in acquisitions since 2010) to buy oil and gas reserves globally, in Africa, Australia, Canada, Iraq, and Qatar.
The Chinese government has been pushing PetroChina to find as much oil as possible as quickly as possible in order to support the industrial and middle class growth that is going on in the world’s most populous nation. Above all the increase in oil production is needed to keep up with the demand of China’s burgeoning car market, where some 20 million car purchases are expected in 2012, and where 8 of 10 car buyers will be making their first car purchase. The market is expected to hit 30 million car sales a year by 2030, or twice that of the current US car market.
China is going to need all the oil it can get.