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@@ -0,0 +1,21308 @@
+1,983,205
+(852) 2899 2010
+(852) 2899 2390
+hko@petrochina.com.hk
+Legal Address of the Company:
+16 Andelu
+Postal Code:
+89 Queensway, Hong Kong
+Principal Place of Business:
+Registered Address of the Company:
+Internet Website:
+Company's Email Address:
+Newspapers for Information Disclosure:
+Dongcheng District
+Beijing, PRC
+Postal Code:
+100011
+Suite 3705, Tower 2, Lippo Centre
+Email Address:
+No. 9 Dongzhimen North Street
+Dongcheng District
+Beijing, PRC
+86(10) 5998 6959
+86(10) 6209 9559
+liangg@petrochina.com.cn
+Wei Fang
+2021 ANNUAL REPORT
+CORPORATE PROFILE
+Chief Representative of the Hong Kong
+Representative Office:
+Address:
+Telephone:
+Facsimile:
+003
+Liang Gang
+No. 9 Dongzhimen North Street
+Dongcheng District
+100007
+PetroChina
+601857
+Hong Kong Stock Exchange
+PETROCHINA
+857
+The New York Stock Exchange
+PTR
+Shanghai Stock Exchange
+004 PETROCHINA COMPANY LIMITED
+PetroChina
+Other relevant information:
+Names and Addresses of Auditors of the Company:
+Domestic Auditors:
+Name:
+Address:
+CORPORATE PROFILE
+Beijing, PRC
+ADSS:
+Symbol:
+Stock Name:
+16 Andelu
+Dongcheng District
+Beijing, PRC
+http://www.petrochina.com.cn
+zhouyunpeng@petrochina.com.cn
+A shares: China Securities Journal, Shanghai
+Securities, News and Securities Times and
+Securities Daily
+Stock Code:
+Internet website publishing this annual report designated by the China Securities Regulatory Commission:
+http://www.sse.com.cn
+No. 9 Dongzhimen North Street, Dongcheng District,
+Beijing, PRC
+Places of Listing:
+A shares:
+Stock Name:
+Stock Code:
+H shares:
+Copies of this annual report are available at:
+zhouyunpeng@petrochina.com.cn
+86(10) 6209 9557
+86(10) 5998 2622
+025 DISCUSSION AND ANALYSIS OF OPERATIONS
+039 SIGNIFICANT EVENTS
+048 CONNECTED TRANSACTIONS
+058 CORPORATE GOVERNANCE
+072 SHAREHOLDERS' RIGHTS AND SHAREHOLDERS' MEETINGS
+074 DIRECTORS' REPORT
+018 BUSINESS REVIEW
+083 REPORT OF THE SUPERVISORY COMMITTEE
+102 RELEVANT INFORMATION ON CORPORATE BONDS
+109 INFORMATION ON CRUDE OIL AND NATURAL GAS RESERVES
+FINANCIAL STATEMENTS
+112 PREPARED IN ACCORDANCE WITH CHINA ACCOUNTING STANDARDS
+206 PREPARED IN ACCORDANCE WITH INTERNATIONAL FINANCIAL REPORTING STANDARDS
+285 CORPORATE INFORMATION
+087 DIRECTORS, SUPERVISORS, SENIOR MANAGEMENT AND EMPLOYEES
+289 DOCUMENTS AVAILABLE FOR INSPECTION
+014 CHAIRMAN'S REPORT
+006 SUMMARY OF FINANCIAL DATA AND FINANCIAL INDICATORS
+PetroChina
+PETROCHINA COMPANY LIMITED
+2021 ANNUAL REPORT
+(a joint stock limited company incorporated
+in the People's Republic of China with limited liability)
+Hong Kong Stock Exchange Stock Code: 857 New York Stock Exchange Symbol: PTR Shanghai Stock Exchange Stock Code: 601857
+009 CHANGES IN SHAREHOLDINGS AND INFORMATION ON SHAREHOLDERS
+PetroChina
+PETROCHINA COMPANY LIMITED
+2021 ANNUAL REPORT
+PetroChina
+CONTENTS
+002 IMPORTANT NOTICE
+003 CORPORATE PROFILE
+PetroChina
+290 CONFIRMATION FROM THE DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
+IMPORTANT NOTICE
+IMPORTANT NOTICE
+Telephone:
+Facsimile:
+Email Address:
+Representative on Securities Matters:
+Address:
+Telephone:
+Facsimile:
+Address:
+Email address:
+PetroChina Company Limited
+Dai Houliang
+Chai Shouping
+No. 9 Dongzhimen North Street
+Dongcheng District
+Beijing, PRC
+中國石油天然氣股份有限公司
+Secretary to the Board:
+Legal Representative of the Company:
+English Name of the Company:
+The Board of Directors (the "Board" or "Board of Directors") of PetroChina Company Limited (the
+"Company"), the Supervisory Committee and the Directors, Supervisors and senior management of the
+Company warrant the truthfulness, accuracy and completeness of the information contained in this annual
+report and that there are no material omissions from, or misrepresentation or misleading statements contained
+in this annual report, and jointly and severally accept full responsibility thereof.
+The 2021 Annual Report has been approved at the fourteenth meeting of the eighth session of the
+Board in 2021. Mr. Liu Yuezhen, a Non-executive Director, and Mr. Huang Yongzhang, an Executive Director
+and President, were absent from the fourteenth meeting of the eighth session of the Board due to work
+arrangement, but had authorized Mr. Jiao Fangzheng, a Non-executive Director and Mr. Ren Lixin, an
+Executive Director and senior Vice President in writing, respectively, to attend the meeting and exercise the
+voting rights on their behalf. Mr. Dai Houliang, Chairman of the Company, Mr. Huang Yongzhang, Director
+and President of the Company, and Mr. Chai Shouping, Chief Financial Officer of the Company, warrant the
+truthfulness, accuracy and completeness of the financial statements in this annual report. No substantial
+shareholder of the Company has utilised the funds of the Company for non-operating purposes.
+The financial statements of the Company and its subsidiaries (the "Group") have been prepared in
+accordance with China Accounting Standards ("CAS") and International Financial Reporting Standards
+("IFRS"), respectively. The financial statements of the Group for 2021, which have been prepared in
+accordance with CAS and IFRS, have been audited by PricewaterhouseCoopers Zhong Tian LLP and
+PricewaterhouseCoopers, respectively. Both firms have issued unqualified opinions on the financial
+statements.
+In overall view of the operating results, financial position and cash flow, to procure return for the
+shareholders, the fourteenth meeting of the eighth session of the Board recommends a final cash dividend of
+RMB0.09622 yuan (inclusive of applicable tax) per share for 2021 to all shareholders, based on the total share
+capital of the Company as at December 31, 2021, namely 183,020,977,818 shares. The total amount of the
+cash dividend reaches RMB17.61 billion. The proposed final dividend is subject to shareholders' review and
+approval at the forthcoming 2021 annual general meeting to be held on June 9, 2022.
+This annual report contains certain forward-looking statements with respect to the financial position,
+operational results and business of the Group. These forward-looking statements are, by their names, subject
+to significant risk and uncertainties because they relate to events and depend on circumstances that may
+occur in the future and are beyond our control. The forward-looking statements reflect the Group's current
+views with respect of future events and are not a guarantee of future performance. Actual results may differ
+from information contained in the forward-looking statements.
+002
+PETROCHINA COMPANY LIMITED
+CORPORATE PROFILE
+CORPORATE PROFILE
+PetroChina
+The Company was established as a joint stock company with limited liability under the Company Law
+of the People's Republic of China (the "PRC" or "China") (the "Company Law") on November 5, 1999 as
+part of the restructuring of China National Petroleum Corporation ("CNPC"). On December 19, 2017,
+石油天然氣集團公司, the Chinese name of CNPC was changed into 中國石油天然氣集團有限公司(“CNPC”
+before and after the change of name).
+The Group is the largest oil and gas producer and seller occupying a leading position in the oil and
+gas industry in the PRC and one of the largest companies in the PRC in terms of revenue and one of
+the largest oil companies in the world. The Group principally engages in, among others, the exploration,
+development, transmission, production and sales of crude oil and natural gas; the refining of petroleum and
+petroleum products; the production and sales of basic and derivative chemical products and other chemical
+products; the marketing and trading of refined products and non-oil products; and the transmission and
+sales of natural gas.
+The American Depositary Shares (the "ADSS"), H shares and A shares of the Company were listed
+on the New York Stock Exchange, the Stock Exchange of Hong Kong limited ("HKSE" or "Hong Kong
+Stock Exchange") and Shanghai Stock Exchange on April 6, 2000, April 7, 2000 and November 5, 2007,
+respectively.
+Registered Chinese Name of the Company:
+Signing accountants:
+PetroChina
+PricewaterhouseCoopers Zhong Tian LLP
+2 Corporate Avenue
+21,333
+14,479
+22,526
+Non-controlling interest
+23,537
+53,036
+20,944
+45,682
+92,170
+Owners of the Company
+Attributable to:
+39,395
+73,980
+67,015
+19,006
+33,485
+15,858
+share attributable to owners of
+2,502,262
+Total assets
+PricewaterhouseCoopers
+430,294
+0.13
+0.29
+438,241
+2,002,636
+Basic and diluted earnings per
+0.25
+466,913
+2,265,997
+2,021,424
+Total non-current assets
+480,838
+Total current assets
+0.50
+the Company (RMB) (1)
+0.10
+486,767
+2,001,359
+2,488,126
+114,696
+(16,296)
+2018
+2,374,934
+2019
+2,516,810
+As at or for the year ended December 31
+2020
+1,933,836
+2,614,349
+2021
+Revenue
+2017
+2,032,298
+Items
+1. Key Financial Data Prepared under IFRS
+SUMMARY OF FINANCIAL DATA
+AND FINANCIAL INDICATORS
+SUMMARY OF FINANCIAL DATA AND FINANCIAL INDICATORS
+005
+2021 ANNUAL REPORT
+Central, Hong Kong, PRC
+Unit: RMB Million
+Profit for the year
+Profit from operations
+75,937
+(42,790)
+(36,199)
+(22,588)
+(43,507)
+Income tax expense
+55,691
+161,153
+116,770
+56,073
+158,203
+Profit before income tax expense
+70,836
+122,942
+121,762
+103,214
+2,732,910
+2,440,877
+2,413,499
+(332,948)
+(181,986)
+(213,032)
+activities
+Net cash flows used for investing
+353,256
+368,729
+(267,812) (243,790)
+359,610
+341,469
+activities
+Net cash flows from operating
+219,346
+256,106
+296,776
+318,575
+246,493
+Net cash flows used for
+Return on net assets (%)
+202 Hu Bin Road
+Huangpu District, Shanghai, PRC
+Zhao Juan, CPA
+Li Dan, CPA
+Overseas Auditors:
+Name:
+financing activities
+Address:
+Note: (1) As at December 31, 2017, 2018, 2019, 2020 and 2021, respectively, basic and diluted earnings per share were
+calculated by dividing the net profit attributable to the owners of the Company with the number of issued shares
+of 183,021 million for each of these financial years.
+(96,746)
+2.0
+(125,703)
+4.4
+(27,276)
+3.7
+(99,400)
+1.6
+(107,971)
+7.3
+006 PETROCHINA COMPANY LIMITED
+251,178
+Capital expenditures
+Other financial data
+1,093,393
+Total liabilities
+446,960
+435,556
+627,186
+516,087
+1,121,505
+575,235
+588,551
+596,430
+661,419
+605,418
+518,158
+Total current liabilities
+Total non-current liabilities
+1,288,605
+1,031,986
+1,035,511
+185,416
+1,377,988
+195,108
+1,408,891
+214,149
+1,444,305
+1,192,572
+1,213,783
+1,230,156
+1,215,158
+151,463
+1,366,621
+1,408,869
+Total equity
+145,308
+Non-controlling interest
+1,263,561
+Owners of the Company
+Attributable to:
+Equity
+11/F, PricewaterhouseCoopers Centre
+22/F, Prince's Building
+Public Interest Entity Auditor registered in
+accordance with the Financial Reporting Council
+Ordinance
+095
+PetroChina
+DIRECTORS, SUPERVISORS, SENIOR MANAGEMENT AND EMPLOYEES
+088 PETROCHINA COMPANY LIMITED
+Duan Liangwei, aged 54, is a Director of the
+Company, and serves concurrently as a Director, Deputy
+Secretary of the Party committee, and Head Office
+Secretary of the Party committee of CNPC. Mr. Duan is
+a professor-level senior engineer and holds a doctor's
+degree. He has extensive working experience in China's
+oil and petrochemical industry. Mr. Duan worked as the
+deputy general manager, safety director, and member of
+the Party committee of Jilin Petrochemical Branch from
+February 2006, and concurrently as secretary of the Party
+committee and general manager of Jilin Fuel Ethanol Co.,
+Ltd. from March 2010. He served as general manager
+and deputy secretary of the Party committee of Dagang
+Hou Qijun, aged 55, is the Vice Chairman of
+the Company and serves concurrently as a Director,
+President and Deputy Secretary of the Party committee
+of CNPC. Mr. Hou is a professor-level senior engineer with
+a doctorate degree, who has rich working experience
+in China's petroleum and natural gas industry. Mr. Hou
+was appointed as director and vice president of Daqing
+Oilfield in October 2002, and as president and deputy
+secretary of the Party committee of Jilin Oilfield Branch
+in October 2004. He was appointed as secretary of the
+Party committee and vice president of PetroChina Natural
+Gas and Pipeline Company in September 2011, and
+concurrently as director-general and deputy secretary
+of the Party committee of PetroChina Oil & Gas Control
+Centre in March 2012. He was appointed as the general
+manager of the planning department of the Company
+in November 2013 and as the Vice President of CNPC
+in March 2017, and concurrently as deputy secretary
+of the Party committee and president of the Company's
+Exploration and Production Branch in April 2017. Mr.
+Hou was appointed as the Director and Vice President of
+the Company in June 2017, and as the President of the
+Company in March 2019. He was appointed as director,
+president and deputy secretary of the Party committee of
+PipeChina in October 2019, and as a Director, President
+and Deputy Secretary of the Party committee of CNPC
+in July 2021. In October 2021, he was appointed as the
+Director and Vice Chairman of the Company.
+Dai Houliang, aged 58, is the Chairman of the
+Company, concurrently serving as the Party Secretary
+and Chairman of CNPC. Mr. Dai is a professor-level senior
+engineer with a doctorate degree and is an alternate
+member of the 19th Central Committee of the Communist
+Party of China. He is an academician of the Chinese
+Academy of Engineering and has substantial working
+experience in China's petroleum and petrochemical
+industry. In December 1997, he was appointed as
+vice president of Yangzi Petrochemical Corporation,
+and served as director and vice president of Yangzi
+Petrochemical Co., Ltd. In April 1998. From July 2002, he
+became vice chairman, president and a member of the
+standing Party committee of Yangzi Petrochemical Co.,
+Ltd., and director of Yangzi Petrochemical Corporation.
+In December 2003, he served as the chairman, president
+and a member of the standing Party committee of Yangzi
+Petrochemical Co., Ltd. and concurrently as chairman of
+Yangzi Petrochemical Corporation, and from November
+2004, concurrently as chairman of BASF-YPC Company
+Limited. From September 2005, he served as deputy
+chief financial officer of China Petroleum & Chemical
+Corporation ("Sinopec Corp."), vice president and deputy
+chief financial officer of Sinopec Corp. in November 2005,
+and as director, senior vice president and chief financial
+officer of Sinopec Corp from May 2006. In June 2008, he
+was concurrently appointed as a member of the Party
+committee of China Petrochemical Corporation ("Sinopec
+Group"). From May 2016, he served as the president,
+director and the deputy Party secretary of Sinopec
+Group, and served as vice chairman and the president of
+Sinopec Corp. in August 2016, as the chairman and the
+president of Sinopec Corp. from May 2018. In July 2018,
+he concurrently served as the Chairman and the Party
+secretariat of Sinopec Group. Mr. Dai was appointed as
+the Chairman and the Party Secretary of CNPC in January
+2020. Since March 2020, he has been appointed as a
+Director, and also concurrently serving as Chairman of the
+Company.
+Brief Biography of Directors:
+DIRECTORS, SUPERVISORS, SENIOR MANAGEMENT AND EMPLOYEES
+2021 ANNUAL REPORT 087
+The above remunerations are pre-tax amounts paid on a calendar year basis, including salaries, allowance, other benefits, contributions
+to retirement benefit schemes etc.
+Mr. Ren Lixin is remunerated by the Company from September 2021.
+Mr. Huang Yongzhang is remunerated by the Company from April 2021.
+Mr. Duan Liangwei resigned from the office of President of the Company in March 2021, and was redesignated from Executive Director to
+Non-executive Director with no further remuneration being received from the Company.
+Note:
+0
+0
+No
+575
+2020.06-
+2023.06
+Petrochemical Branch from September 2011. He served
+as general manager and deputy secretary of the Party
+committee of Dalian Petrochemical Branch, manager of
+Dalian Petrochemical Company, and the director of the
+Enterprise Coordination Committee of Dalian Area from
+July 2013. He served as Vice President of CNPC from
+March 2017, and concurrently as Safety Director of CNPC
+from April 2017. Mr. Duan was appointed as a Director of
+the Company from June 2017, and concurrently became a
+member of the Party committee of CNPC from September
+2019. Mr. Duan was appointed as the President of the
+Company in March 2020, and the Director and Deputy
+Secretary of the Party committee of CNPC in September
+2020. Since October 2020, Mr. Duan concurrently served
+as the Head Office Secretary of the Party committee of
+CNPC.
+Liu Yuezhen, aged 60, is a Director of the Company.
+Mr. Liu is a professor-level senior accountant, holds a
+master's degree, and has extensive working experience
+in accounting industry. He served as the deputy general
+manager and chief accountant of AVIC Jianghan Aviation
+Life-saving Appliance Corporation from March 1996,
+the general manager of Jianghan Aviation Life-saving
+Appliance Corporation and concurrently a director of
+610 Research Institute from February 2000, the chairman
+and general manager of AVIC Beijing Qingyun Aviation
+Instruments Co., Ltd. from May 2003, the chief accountant
+of CASIC (Group) Company from November 2006, and a
+member of the Party committee and chief accountant of
+CASIC (Group) Company from December 2007. He has
+served as a member of the Party committee and Chief
+Accountant of CNPC since December 2013. From May
+2014, Mr. Liu has been appointed as a Director of the
+Company.
+Jiao Fangzheng, aged 59, is a Director of the
+Company and member of the Party committee and
+Vice President of CNPC. Mr. Jiao is a professor-level
+senior engineer with a doctorate degree and has
+substantial working experience in China's petroleum
+and petrochemical industry. In January 1999, he was
+appointed as chief geologist in Zhongyuan Petroleum
+Exploration Bureau of China Petrochemical Corporation.
+In February 2000, he was appointed as vice president and
+chief geologist of Sinopec Zhongyuan Oilfield Company.
+In July 2000, he was appointed as deputy director
+general and member of the Party committee of Sinopec
+Petroleum Exploration & Development Research Institute.
+In March 2001, he was appointed as deputy director
+general of Sinopec Oilfield Exploration & Production
+Department. In June 2004, he was appointed as director
+general and deputy secretary to the Party Committee
+of Northwest Petroleum Bureau of China Petrochemical
+Corporation, and president of Sinopec Northwest Branch
+Company. In October 2006, he was appointed as vice
+president of Sinopec Corp. In July 2010, he concurrently
+served as the director general of Sinopec Exploration &
+Production Department. In July 2014, he was appointed
+as member of the Party committee and vice president of
+China Petrochemical Corporation. In September 2014, he
+concurrently served as chairman of the board of directors
+of Sinopec Oilfield Service Corporation. In May 2015, he
+concurrently elected as director and senior vice president
+of Sinopec Corp. In June 2018, he served as a member of
+the Party committee and Vice President of CNPC. In June
+2019, he was appointed as Director of the Company.
+(2) Supervisors
+DIRECTORS, SUPERVISORS, SENIOR MANAGEMENT AND EMPLOYEES
+091
+2021 ANNUAL REPORT
+Jiang, Simon X., aged 68, is currently an Independent
+Non-executive Director of the Company. Mr. Jiang has
+been an independent non-executive director of COSCO
+SHIPPING International (Hong Kong) Co., Ltd. since
+April 2007. He is chairman of Cyber City International
+Limited. Mr. Jiang is also a director of China Foundation
+for Disabled Persons, and a senior associate at the Judge
+Business School of Cambridge University of England. He
+is currently a member of the United Nations Investments
+Committee. Mr. Jiang received his bachelor's degree
+from Beijing Foreign Studies University, master's degree
+from Australian National University and Ph.D degree in
+Economics from Cambridge University of England. Mr.
+Jiang has investment management experience. Mr. Jiang
+was the deputy chief of United Nations Joint Staff Pension
+Fund Investment Management and work as a member of
+its Investment Committee till now. He was a member of
+the 11th and 12th Sessions of the National Committee of
+the Chinese People's Political Consultative Conference,
+an independent director of China Oilfield Services Limited
+("COSL"), an independent director of Greenland Hong
+Kong Holdings Limited, Nokia Corporation, and Sinopec
+Corp. From June 2020, Mr. Jiang was appointed as the
+Independent Non-executive Director of the Company.
+Cai Jinyong, aged 62, is the Independent Non-
+executive Director of the Company. Mr. Cai is a partner
+of Global Infrastructure Partners (GIP) and concurrently
+a board member of Aon Corporation. Mr. Cai received
+bachelor's degree in science from Peking University and
+doctoral degree of economics from Boston University.
+Mr. Cai has over 30 years working experience in finance
+service industry, before joining GIP in 2019, he has working
+experience in TPG Group, World Bank Group, Goldman
+Sachs Group, Inc. and Morgan Stanley. Mr. Cai worked
+at Central Europe Bureau of the Head Office of the World
+Bank in charge of energy sectors from 1990 to 1994. From
+1994 to 2000, he served in Morgan Stanley and was a
+team member which established China International
+Capital Corporation Limited (the first domestic joint
+venture investment bank in the PRC). From 2000 to 2012,
+he worked in Goldman Sachs Group, Inc., where he was
+in charge of the PRC Investment Banking Business. From
+2012 to 2016, he served as CEO of International Finance
+Corporation of the World Bank Group. From 2016 to 2018,
+he led infrastructure business in emerging economies
+at TPG. From June 2020, Mr. Cai was appointed as the
+Independent Non-executive Director of the Company.
+committee of the board of Rio Tinto plc. He is also a member
+of the Defense Council for the UK Government, serving
+as the chairman of audit and risk management currently.
+Mr. Simon Henry was appointed as an Independent Non-
+executive Director of the Company from June 2017.
+PetroChina
+executive Director
+DIRECTORS, SUPERVISORS, SENIOR MANAGEMENT AND EMPLOYEES
+Simon Henry, aged 60, is an Independent Non-
+executive Director of the Company and also a fellow of the
+UK Chartered Institute of Management Accountants, who
+has experience in areas such as finance management,
+strategic planning, marketing and investor relations. Mr.
+Simon Henry obtained a first class Bachelor's degree in
+mathematics from Cambridge University in 1982 and was
+awarded a Master's degree in 1986 from Cambridge. He
+joined Royal Dutch Shell in 1982. He acted for 8 years
+until March 2017 as executive director of the board and
+chief finance officer of Royal Dutch Shell. He now serves
+as a non-executive director and chairman of the audit
+Tokuchi Tatsuhito, aged 69, is an Independent
+Non-executive Director of the Company. He is also an
+independent director of Daiwa Securities (China) Co., Ltd.
+and an executive director and research fellow of the Center
+for Industrial Development and Environment Governance
+(CIDEG), Tsinghua University, a senior fellow of Rebuild
+Japan Initiative Foundation. Mr. Tokuchi graduated from
+the Department of Chinese Language and Literature,
+Peking University, and received his master degree (East
+Asian Economy) from the Center for East Asian Studies
+of Stanford University. He has held the positions including
+a member & experts adviser to the Foreign Advisory
+Committee of State Administration of Foreign Experts
+Affairs, the PRC, the general manager of Investment
+Banking Division of Daiwa Securities SMBC Co., Ltd.,
+the president of Daiwa Securities Singapore Limited, the
+Executive Vice President of Daiwa Securities (Hong Kong)
+Inc., the vice president of Daiwa Securities (America)
+Inc., the vice chairman of Singapore Investment Banking
+Association, the vice president, managing director and the
+chairman of the Investment Banking Committee of CITIC
+Securities Co., Ltd., and the chairman of board of the CITIC
+Securities International Co., Ltd. In 2009, Mr. Tokuchi was
+awarded the China Friendship Award, China's award for
+foreigners. Mr. Tokuchi was appointed as an Independent
+Non-executive Director of the Company from June 2017.
+Elsie Leung Oi-sie, aged 82, is an Independent
+Non-executive Director of the Company, a consultant of
+lu, Lai & Li Solicitors & Notaries, and an independent
+non-executive director of China Life Insurance Company
+Limited and China Resources Power Holdings Co., Ltd.
+Ms. Leung obtained her LLM degree from the University
+of Hong Kong, and is an academician of College of
+International Marriage Law. She holds the practicing
+qualifications for attorney of Hong Kong and Britain. Ms.
+Leung was the first Secretary for Justice of the Hong Kong
+Special Administrative Region and a member of Executive
+Council of HKSAR. Ms. Leung was appointed as a Justice
+of the Peace, a Notary Public, and a China-Appointed
+Attesting Officer, and was awarded a Grand Bauhinia
+Medal. Ms. Leung was appointed as an Independent
+Ren Lixin, aged 54, is a Director and the senior Vice
+President of the Company and concurrently serves as
+a member of the Party committee and Vice President of
+CNPC. Mr. Ren is a professor-level senior engineer with
+a bachelor's degree, who has rich working experience in
+China's petroleum and petrochemical industry. Mr. Ren
+was appointed as a member of the Party committee and
+the vice president of Dushanzi Petrochemical Branch
+Company in September 2005, and was then appointed
+as president, deputy secretary of the Party committee
+and safety director of Dushanzi Petrochemical Branch
+Company in October 2018, and concurrently as the
+executive director and president of Xinjiang Dushanzi
+Petrochemical Co., Ltd. Mr. Ren was appointed as
+president and deputy secretary of the Party committee
+of the Refinery and Chemical Branch of the Company in
+March 2021. He was appointed as a member of the Party
+committee and a Vice President of CNPC in June 2021.
+In August 2021, he was appointed as the senior Vice
+President of the Company and in October 2021, he was
+appointed as the Director of the Company.
+Non-executive Director of the Company from June 2017.
+Corporation in April 2020, Director of the Company in
+September 2020 and President of the Company in March
+2021.
+DIRECTORS, SUPERVISORS, SENIOR MANAGEMENT AND EMPLOYEES
+2021 ANNUAL REPORT 089
+Huang Yongzhang, aged 55, is a Director and
+President of the Company and serves concurrently as
+a member of the Party committee, Vice President and
+Safety Director of CNPC. Mr. Huang is a professor-level
+senior engineer and holds a doctor's degree. He has rich
+working experience in China's petroleum and natural gas
+industry. He served as, inter alia, Vice President of CNPC
+International (Nile) Ltd., Vice President and concurrently
+as safety director of China National Oil Exploration and
+Development Corporation, and the Executive Vice
+President of CNPC Middle East Corporation. He served as
+leader of the coordination group of CNPC Middle East and
+General Manager of CNPC Middle East Corporation from
+January 2018. He was appointed as a member of the Party
+committee, Vice President of China National Petroleum
+090 PETROCHINA COMPANY LIMITED
+Information on the current Supervisors is set out below:
+68
+M
+0
+No
+527
+2017.06-
+Independent non-
+executive Director
+69
+69
+M
+Tokuchi Tatsuhito
+2023.06
+executive Director
+0
+0
+No
+556
+2017.06-
+Independent non-
+22
+82
+0
+2023.06
+Simon Henry
+M
+Jiang, Simon X.
+2023.06
+0
+0
+No
+575
+2020.06-
+Independent non-
+executive Director
+62
+Independent non-
+M
+2023.06
+0
+0
+No
+499
+2017.06-
+Independent non-
+executive Director
+60
+60
+Cai Jinyong
+Remuneration
+Whether
+Number of Shares held
+in the Company
+0
+No
+1,433
+59
+M
+2017.06-
+appointed by
+Fu Suotang
+Supervisor
+2023.06
+0
+0
+Yes
+0
+0
+Yes
+Supervisor
+59
+M
+0
+employees'
+2023.06
+representatives
+employees'
+representatives
+58
+M
+Liu Xianhua
+appointed by
+Supervisor
+representatives
+0
+0
+Wang Liang
+No
+2023.06
+employees'
+1,255
+58
+M
+2014.05-
+appointed by
+Li Jiamin
+Supervisor
+2
+2017.10-
+2023.06
+56 Supervisor
+0
+Yes
+Supervisory
+59
+M
+Lv Bo
+2020.11-
+Chairman of
+31, 2021
+0
+31, 2020
+As at
+December December
+from offices
+held in CNPC
+remuneration
+received
+before tax
+received from
+the Company in
+2021 (RMB'000)
+Term
+Age Position
+Gender
+Name
+As at
+F
+2023.11
+2014.05-
+M
+Lu Yaozhong
+2017.06-
+2023.06
+0
+0
+Yes
+0
+0
+Committee
+Yes
+58
+M
+Jiang Lifu
+2014.10-
+2023.06
+Supervisor
+60
+M
+Zhang Fengshan
+Supervisor
+2021 ANNUAL REPORT
+LL
+2023.03
+Zhang Minglu
+1,422
+Chief Engineer
+0
+0
+No
+2017.12-
+58
+M
+Yang Jigang
+Vice President and
+1,472
+0
+0
+No
+2017.01-
+Secretary to the Board
+60
+M
+M
+58
+Safety Director
+2021.07-
+PetroChina
+Li Jiamin, aged 58, is a Supervisor of the Company
+appointed by its employees' representatives and
+concurrently serves as the Director of the Party and Masses'
+affairs Department of the Company. Mr. Li. concurrently
+serves as the Director of the Party and Masses' affairs
+Department, the Head Office Executive Deputy Secretary
+of the Party committee, and the Deputy Director of the
+Party Organisation Department of CNPC. Mr. Li is a
+professor-level senior engineer with a master's degree and
+has extensive work experience in China's petrochemical
+industry. He has been the deputy general manager and
+chief security officer and member of the Party committee
+of Lanzhou Petrochemical Branch Company from August
+2004. He was appointed as the general manager and
+vice Party secretariat of Lanzhou Petrochemical Branch
+Company and the general manager of Lanzhou Petroleum
+& Chemical Company in March 2012. He was appointed
+as a Supervisor representing employees of the Company
+in May 2014. From November 2017, he served as the
+Party secretariat and general manager of Lanzhou
+Petrochemical Branch Company and the executive
+director and general manager of Lanzhou Petroleum &
+Chemical Co., Ltd. From August 2020, Mr. Li served as
+the General Manager of the corporate culture department
+and concurrently the General Manager (Minister, Director)
+of the CNPC's ideological and political work department
+(party group propaganda department, corporate culture
+department, press office). From December 2020, Mr. Li
+has served as the Director of the Party and Masses' affairs
+Department, concurrently as the Director of the Party and
+Masses' affairs Department, the Head Office Executive
+Deputy Secretary of the Party committee, and the Deputy
+Director of the Party Organisation Department of CNPC.
+096 PETROCHINA COMPANY LIMITED
+Li Luguang, aged 59, is a Vice President of the
+Company. As a professor-level senior engineer and a
+doctorate degree holder, Mr. Li has rich working experience
+in China petroleum industry. He served as the deputy
+general manager and Party member of Southwest Oil
+2014. Mr. Sun was appointed as the general manager
+of Science and Technology Management Department of
+the Company and the general manager of Science and
+Technology Management Department of CNPC in July
+2015. From March 2016, he has concurrently served as the
+executive director and general manager of Daqing Oilfield
+Co., Ltd., director of Daqing Petroleum Administration
+Bureau and vice Party secretariat of Daqing Oilfield. From
+October 2018, he concurrently served as the executive
+director of Daqing Oilfield Co., Ltd., the Party secretariat
+of Daqing Oilfield, and the executive director of Daqing
+Petroleum Administration Bureau Co., Ltd. He ceased to
+hold the above three positions from June 2021. From July
+2021, he has concurrently served as the Chief Geologist
+of the Company.
+Sun Longde, aged 59, is a Vice President of the
+Company, and concurrently the Chief Geologist of the
+Company. Mr. Sun is a professor-level senior engineer
+and holds a doctorate degree. He is an academician
+of the Chinese Academy of Engineering. He has rich
+working experience in China's oil and geological industry.
+He served as the manager of Exploration & Development
+Company of Shengli Petroleum Administration Bureau
+from September 1997, chief geologist and member of
+the Party committee of Tarim Petroleum Exploration &
+Development Headquarters from November 1997, deputy
+general manager and member of the Party committee of
+Tarim Oilfield Company from September 1999 and the
+general manager and Party secretariat of Tarim Oilfield
+Company from July 2002. Mr. Sun was appointed as a
+Vice President of the Company since June 2007. He was
+elected as an academician of the Chinese Academy of
+Engineering in December 2011. He concurrently served
+as the director of CNPC Consulting Centre from April
+Brief Biography of the Senior Management:
+Note: The above remunerations are pre-tax amounts paid on a calendar year basis, including salaries, allowance, other benefits,
+contributions to retirement benefit schemes etc.
+Chai Shouping
+0
+852
+2021.07-
+Vice President
+55
+M
+Zhu Guowen
+0
+No
+854
+No
+DIRECTORS, SUPERVISORS, SENIOR MANAGEMENT AND EMPLOYEES
+Chief Financial Officer,
+0
+Sun Longde
+31, 2021
+31, 2020
+As at
+December
+As at
+December
+from offices
+in 2021
+(RMB'000) held in CNPC
+Term
+Gender Age Position
+Name
+the Company remuneration
+received
+in the Company
+Number of Shares held
+Whether
+Remuneration
+before tax
+received from
+Information on current members of the senior management is set out below:
+(3) Senior Management
+DIRECTORS, SUPERVISORS, SENIOR MANAGEMENT AND EMPLOYEES
+M
+59
+Vice President and
+Chief Geologist
+2007.06-
+Liu Xianhua, aged 58, is a Supervisor of the
+Company appointed by its employees' representatives
+and concurrently serves as the chairman of PetroChina
+Xinjiang Sales Company Limited. Mr. Liu is a professor-
+level senior economist and holds a master's degree.
+He has rich working experience in China's oil and
+petrochemical industry. He served as the general manager
+and vice Party secretariat of Shandong Sales Branch
+from May 2005. He served as the general manager and
+vice Party secretariat of North-eastern Sales Branch from
+March 2012. He has been serving as the general manager
+and vice Party secretariat of Liaoning Sales Branch,
+and concurrently as the general manager of Liaoning
+Petroleum Corporation from December 2015. Mr. Liu was
+appointed as a Supervisor representing employees of
+the Company in May 2016. From November 2017, Mr. Liu
+served as general manager and the vice Party secretariat
+of Liaoning Sales Branch and the executive director and
+concurrently served as the general manager of Liaoning
+Petroleum Sales Branch. In November 2021, he was
+appointed the chairman of PetroChina Xinjiang Sales
+Company Limited.
+1,474
+2015.11-
+Vice President
+59
+M
+Tian Jinghui
+0
+0
+0
+No
+2018.06-
+Vice President
+59
+M
+Li Luguang
+1,697
+0
+0
+No
+1,378
+094 PETROCHINA COMPANY LIMITED
+Fu Suotang, aged 59, is a Supervisor of the Company
+appointed by its employees' representatives. Mr. Fu is
+a professor-level senior engineer and holds a doctorate
+degree, with rich working experience in China's oil and
+natural gas industry. Mr. Fu acted as the chief geologist and
+member of the Party committee of Qinghai Oilfield Branch
+from April 2007, the general manager and vice Party
+secretariat of Qinghai Oilfield Branch and concurrently
+the director of Qinghai Petroleum Administration Bureau
+from April 2014, the general manager and vice Party
+secretariat of Changqing Oilfield Branch and concurrently
+the director of Changqing Petroleum Exploration Bureau
+from April 2017. In June 2017, he was appointed as a
+Supervisor representing employees of the Company. From
+April 2018, he served as the Party secretariat and general
+manager of Changqing Oilfield Branch and the executive
+director and general manager of Changqing Petroleum
+Exploration Bureau Co., Ltd. From October 2020, Mr. Fu
+has served as executive director and Party secretary of
+Changqing Oilfield Branch, and executive director and
+general manager of Changqing Petroleum Exploration
+Bureau. In June 2021, Mr. Fu served as the standing vice
+director of the consultation centre of CNPC.
+Wang Liang, aged 59, is a Supervisor of the
+Company and the General Manager of Audit Department
+of the Company and concurrently served as the General
+Manager of Audit Department, Director and Deputy
+Secretary of the Party committee of Audit Service Center
+of CNPC. Mr. Wang is a professor-level senior accountant
+and holds a bachelor's degree. He has rich working
+experience in China's oil and gas industry. He had
+worked as a director, chief accountant and member of
+the Party committee in China National Petroleum Offshore
+Engineering Co., Ltd. from January 2005, a member of the
+Party committee and deputy director of Liaoning Provincial
+Finance Department from April 2006, the chairman of
+Generali China Insurance Co., Ltd. from April 2007, the
+chief accountant and member of the Party committee
+of CNPC Chuanqing Drilling Engineering Company
+Limited from February 2008, the general manager and
+deputy secretary of the Party committee of CNPC Assets
+Management Co., Ltd. from October 2009, the chairman,
+general manager and deputy secretary of the Party
+committee of Kunlun Trust Co., Ltd. from March 2014, the
+chairman, secretary of the Party committee, secretary
+Yes
+59 Non-executive Director
+M
+Jiao Fangzheng
+2019.06-
+2023.06
+0
+0
+Yes
+60 Non-executive Director
+M
+Liu Yuezhen
+2014.05-
+2023.06
+0
+0
+Yes
+237
+54 Non-executive Director
+0
+о
+2022.06
+Executive Director,
+Senior Vice President
+0
+0
+No
+195
+54
+M
+Ren Lixin
+2021.10-
+M
+Executive Director,
+President
+0
+0
+No
+629
+55
+M
+Huang Yongzhang
+2020.09-
+2023.09
+Duan Liangwei
+2017.06-
+2023.03
+1. Information on the Directors, Supervisors and Senior Management
+DIRECTORS, SUPERVISORS, SENIOR
+MANAGEMENT AND EMPLOYEES
+PetroChina
+DIRECTORS, SUPERVISORS, SENIOR MANAGEMENT AND EMPLOYEES
+No
+0
+0
+Note: The above remunerations are pre-tax amounts paid on a calendar year basis, including salaries, allowance, other benefits,
+contributions to retirement benefit schemes etc.
+092 PETROCHINA COMPANY LIMITED
+(1) Directors
+DIRECTORS, SUPERVISORS, SENIOR MANAGEMENT AND EMPLOYEES
+Brief Biography of the Supervisors:
+Lv Bo, aged 59, is currently the Chairman of the
+Supervisory Committee of the Company. Mr. Lv is a senior
+economist with a master's degree and has extensive
+work experience in China's oil and gas industry. In
+January 2002, Mr. Lv was appointed as director-general
+of Human Resources Department of China National
+Offshore Oil Corporation ("CNOOC"). He served as the
+assistant president of CNOOC in November 2006, a
+member of the Party committee of CNOOC in November
+2007, and concurrently as the Head Office Secretary
+of the Party committee of CNOOC in October 2008.
+From April 2010, he served as a member of the Party
+committee and vice president of CNOOC, and from
+December 2012, concurrently as the chairman of CNOOC
+Energy Technology & Services Limited, from May 2015,
+concurrently as the president of CNOOC Party School,
+and from December 2016, concurrently as the chairman
+of Offshore Oil Engineering Co., Ltd. and COSL. Mr. Lv
+served as a member of the Party committee and Vice
+President of CNPC in November 2019. From March 2020
+to October 2020, he served as a Director of the Company.
+Since November 2020, he has been appointed as the
+Supervisor and Chairman of the Supervisory Committee of
+the Company. In September 2021, he has been appointed
+as the full-time external director of central enterprise.
+Zhang Fengshan, aged 60, is a Supervisor of the
+Company. Mr. Zhang is a professor-level senior engineer
+and holds a master's degree. He has rich working
+experience in China's oil and gas industry. Mr. Zhang was
+the deputy director and member of the standing Party
+committee of Liaohe Oil Exploration Bureau from July
+2000 and concurrently the safety director of Liaohe Oil
+Exploration Bureau from May 2002, director and deputy
+secretary of the Party committee of Liaohe Petroleum
+Exploration Bureau from August 2004, general manager
+and deputy secretary of the Party committee of Great Wall
+Drilling and Exploration Company Limited from February
+2008 and its executive director from July 2008. Mr. Zhang
+has been the General Manager of Safety, Environment and
+Energy Conservation Department of the Company and
+the General Manager of Safety, Environment and Energy
+Conservation Department of CNPC since June 2012.
+In May 2014, he was appointed as a Supervisor of the
+Company. From July 2014, Mr. Zhang has been the Safety
+Director of the Company and Deputy Safety Director of
+CNPC. From December 2015, Mr. Zhang was appointed
+as the Director of Safety, Environment Supervision Center
+of CNPC concurrently. From December 2016 to June 2021,
+he has concurrently been serving as the General Manager
+of the Quality, Safety and Environmental Department of the
+Company and concurrently the General Manager of the
+Quality, Safety and Environmental Department of CNPC.
+Jiang Lifu, aged 58, is a Supervisor of the Company,
+and concurrently served as the assistant to the General
+Manager of CNPC. Mr. Jiang is a professor-level senior
+economist and holds a doctorate degree. He has rich
+working experience in China's oil and gas industry.
+He had worked as Deputy General Manager of Capital
+Operation Department of the Company since August
+2003, Deputy Director of the Planning Department of
+CNPC from May 2005, Deputy General Manager of the
+Planning Department of the Company from June 2007 and
+concurrently Deputy Director of the Planning Department
+of CNPC. He has been the General Manager of the
+Enterprise Management Department (Internal Control
+and Risk Management Department) of the Company
+and the General Manager of the Enterprise Management
+Department (Internal Control and Risk Management
+Department) of CNPC since April 2014. In October 2014,
+Mr. Jiang was appointed as a Supervisor of the Company.
+In April 2015, he was appointed as the General Manager
+of the Reform and Corporate Management Department of
+the Company and concurrently the General Manager of
+the Reform and Corporate Management Department of
+CNPC. In April 2021, he was appointed as the assistant to
+the General Manager of CNPC.
+2021 ANNUAL REPORT 093
+DIRECTORS, SUPERVISORS, SENIOR MANAGEMENT AND EMPLOYEES
+Lu Yaozhong, aged 56, is a Supervisor of the
+Company, and concurrently served as the General
+Manager of Kunlun Capital. Mr. Lu is a professor-level
+senior accountant and holds a master's degree. He has
+rich working experience in China's oil and gas industry.
+Mr. Lu assumed the position of the chief accountant and
+member of the Party committee of the Kazakhstan branch
+from December 2009, and the chief accountant and
+member of the Party committee of the overseas exploration
+and development branch (China National Oil and Gas
+Exploration and Development Corporation) from August
+2013, and the General Manager of the Capital Operation
+Department of the Company, and concurrently the General
+Manager of the Capital Operation Department of CNPC
+from April 2017. In June 2017, Mr. Lu was appointed as
+a Supervisor of the Company. In October 2021, he was
+appointed as the General Manager of Kunlun Capital.
+of the disciplinary committee and president of the trade
+union of CNPC Assets Management Co., Ltd. from July
+2014, the secretary of the Party committee, secretary of
+the disciplinary committee, president of the trade union
+and deputy general manager of CNPC Finance from
+July 2016. He has been the General Manager of Audit
+Department of the Company and concurrently the General
+Manager of Audit Department, Director and Secretary of
+the Party committee of Audit Service Center of CNPC from
+May 2017. Mr. Wang was appointed as a Supervisor of the
+Company from October 2017. From November 2017, he
+served as the General Manager of the Audit Department
+of the Company, and concurrently the General Manager
+of the Audit Department, Director and Deputy Secretary of
+the Party committee of the Audit Service Center of CNPC.
+PetroChina
+Elsie Leung Oi-sie
+Information on the current Directors is set out below:
+Whether
+received
+0
+0
+Yes
+55 Vice Chairman
+M
+Hou Qijun
+2021.10-
+2023.03
+0
+Remuneration
+before tax
+received from
+0
+58 Chairman
+M
+Dai Houliang
+2020.03-
+the Company remuneration As at
+As at
+in 2021 from offices December December
+(RMB'000) held in CNPC 31, 2020 31, 2021
+Term
+Gender Age Position
+Name
+Number of Shares held
+in the Company
+Yes
+No
+945
+2016.05-
+2023.06
+Bond Name Abbreviation Code
+2012
+1. Information on Bonds Issued but Not Yet Overdue of the Company
+RELEVANT INFORMATION ON
+CORPORATE BONDS
+RELEVANT INFORMATION ON CORPORATE BONDS
+2021 ANNUAL REPORT 101
+No material changes occurred during the reporting
+period to the core technical teams and key technical
+staff of the Company (i.e. those other than Directors,
+Supervisors and Senior Management).
+12. Core Technical Teams and Key
+Technical Staff
+a robust company strategy based on talent. It serves to
+increase the calibre of its staff and its competitiveness and
+helps to build a harmonious enterprise. Employee training
+of the Company covers basic concepts, policies and
+regulations, knowledge required for a job position, safety
+awareness, cultural knowledge and technical skills as a
+fundamental basis. In practice, training revolves around
+four comprehensive programmes, namely, competences-
+building directed at the management, technical innovation
+at professional and technical staff, skill enhancement at
+operators and workers and internationalisation of talent.
+These training efforts are multi-dimensional and diversified
+in approaches, which can better cater to the Company's
+development requirements and its needs for building
+high-calibre working teams.
+The Company has been consistently focused on
+employee training as an important means of achieving
+11. Employee Training
+Details on employee welfare plans of the Company
+are set out in Note 34 to the financial statements prepared
+in accordance with IFRS in this annual report.
+10. Employee Welfare Plans
+The Company has in place various equitable and
+competitive remuneration systems to cater for different
+positions. At regional companies, an annual salary system
+is adopted for the management, a positional wage system
+for supervisory, professional and technical positions and
+a positional skill-based wage system for operators and
+workers. In addition, subsidies are offered to those who
+possess more sophisticated technical and working skills.
+Each employee is remunerated according to the level of
+their job position, individual competence and contribution,
+and with changes in the relevant factors, such remuneration
+will also be adjusted in a timely manner.
+9. Employee Remuneration Policy
+100.00
+417,173
+36.88
+153,862
+22.57
+94,137
+36.00
+150,202
+4.55
+18,972
+Percentage of total no. of employees (%)
+Number of Employees
+Total
+Technical secondary and below
+Polytechnic college
+Issue
+Date
+University
+Value
+Corporate
+2013
+20 5.04 maturity
+November November November
+22, 2012 22, 2012 22, 2027
+03 122211.SH
+term)
+12 PetroChina
+(15-year
+Tranche)
+Bond (First
+Corporate
+2012
+sum repayment Shanghai
+of principal at
+Stock
+Exchange
+Annual payment
+of interests,
+and one lump
+20 4.90 maturity
+sum repayment Shanghai
+of principal at
+and one lump
+of interests,
+Annual payment
+Mode of Exchange
+Repayment for Listing
+Stock
+million) (%)
+Bond
+Balance
+(RMB 100 Rate
+November November November|
+02 122210.SH 22, 2012 22, 2012 22, 2022
+term)
+12 PetroChina
+(10-year
+Tranche)
+Bond (First
+Date Due Date
+Master and above
+The education levels of employees as at December 31, 2021 is set out below:
+PetroChina
+Natural Gas and Pipeline
+Marketing
+Refining and Chemicals
+Exploration and Production
+The number of employees for each of the segment as
+of December 31, 2021 is set out below:
+During the reporting period, the permitted indemnity
+provisions to the benefit of the Directors continued to be
+As at December 31, 2021, the Group had 417,173
+employees (excluding 248,405 temporary and seasonal
+staff) and 287,406 retired staff.
+8. Employees of the Group
+Each member of the senior management of the
+Company has entered into a performance agreement
+with the Company. The Company's senior management
+remuneration policy links financial interests of the senior
+management with the Group's operating results.
+7. Remuneration Policy of the Senior
+Management
+effective and the Company has arranged appropriate
+liability insurance for Directors, Supervisors and the senior
+management.
+6. Permitted Indemnity Provisions
+None of the Directors, Supervisors or any entity related
+to the Directors and Supervisors had any material interest,
+either directly or indirectly, in any transaction, arrangement
+and contract of significance to which the Company or any
+of its subsidiaries was a party to during the year.
+5. Interests of Directors and Supervisors in
+Contracts
+No Director or Supervisor has entered into any
+service contract with the Company which is not terminable
+by the Company within one year without payment of
+compensation other than statutory compensation.
+4. Service Contracts of Directors and
+Supervisors
+DIRECTORS, SUPERVISORS, SENIOR MANAGEMENT AND EMPLOYEES
+099
+2021 ANNUAL REPORT
+◆自用气分可
+As at December 31, 2021, none of the Directors,
+Supervisors or chief executive had any interest and short
+positions in any shares, underlying shares or debentures
+of the Company or any associated corporation within the
+meaning of Part XV of the SFO required to be recorded in
+the register mentioned under Section 352 of the SFO or as
+otherwise notifiable to the Company and the Hong Kong
+Stock Exchange by the Directors, Supervisors and chief
+executive pursuant to the Model Code.
+3. Interests of Directors, Supervisors and
+chief executive in the Share Capital of the
+Company
+and elected Mr. Hou Qijun as the Vice Chairman of the
+Company.
+On October 28, 2021, the Company held the twelfth
+meeting of the eighth session of Board of Directors
+On October 21, 2021, the Company held the first
+extraordinary shareholders' meeting of 2021 and elected
+Mr. Hou Qijun and Mr. Ren Lixin as Directors of the
+Company.
+On September 3, 2021, Mr. Ling Xiao resigned from
+his position as Vice President of the Company due to
+personal reasons.
+On August 25 to 26, 2021, the Company held
+the eleventh meeting of the eighth session of Board of
+Directors and appointed Mr. Ren Lixin as the Senior Vice
+President of the Company.
+PetroChina
+DIRECTORS, SUPERVISORS, SENIOR MANAGEMENT AND EMPLOYEES
+Other*
+Total
+Number of Employees
+Percentage of total no. of employees (%)
+DIRECTORS, SUPERVISORS, SENIOR MANAGEMENT AND EMPLOYEES
+100.00
+417,173
+56.49
+235,661
+14.63
+61,032
+28.88
+120,480
+Percentage of total no. of employees (%)
+Number of Employees
+100 PETROCHINA COMPANY LIMITED
+Total
+Technical operation
+Corporate
+Technology
+The employee structure by profession as at December 31, 2021 is set out below:
+* includes staff of the Company's headquarters, specialised subsidiaries, Exploration & Development Research Institute, Planning &
+Engineering Institute, Petrochemical Research Institute and other units.
+100.00
+417,173
+1.35
+5,634
+0.94
+3,928
+8.90
+37,134
+30.87
+128,785
+57.94
+241,692
+Administration
+Bond (First
+106 PETROCHINA COMPANY LIMITED
+(10-year
+19 PetroChina 101900222.
+MTN003
+Tranche
+MTN
+2019 Third
+January
+24, 2019
+January
+22, 2019
+IB
+MTN002
+19 PetroChina 101900114.
+MTN
+Tranche
+2019 Second
+Due Date
+Date
+Value
+Issue
+Date
+Bond Name Abbreviation Code
+PetroChina
+RELEVANT INFORMATION ON CORPORATE BONDS
+PETROCHINA COMPANY LIMITED
+102
+Market
+National
+Inter-bank
+Bond
+Exchange
+Stock
+100 3.45 maturity
+Annual payment
+of interests,
+and one lump
+sum repayment
+of principal at
+20 3.60 maturity
+sum repayment Shanghai
+of principal at
+Exchange
+2019 Fourth
+Tranche
+MTN
+2019 Fifth
+Tranche
+MTN
+100 3.45 maturity
+of interests,
+and one lump
+sum repayment
+of principal at
+Annual payment
+Mode of Exchange
+Repayment for Listing
+Stock
+million) (%)
+(RMB 100 Rate
+Bond
+Balance
+April 9,
+2023
+April 9,
+2020
+April 8,
+2020
+IB
+20 PetroChina 102000621.
+MTN001
+Tranche
+MTN
+Stock
+2020 First
+April 23,
+2024
+April 23,
+2019
+April 22,
+2019
+IB
+February
+22, 2024
+February
+22, 2024
+January
+24, 2024
+19 PetroChina 101900221.
+MTN004
+February
+22, 2019
+February
+21, 2019
+IB
+February
+22, 2019
+February
+21, 2019
+IB
+19 PetroChina 101900586.
+MTN005
+098 PETROCHINA COMPANY LIMITED
+Annual payment
+of interests,
+and one lump
+sum repayment Shanghai
+of principal at
+Corporate
+2016
+March
+3, 2016
+March
+1, 2016
+04 136254.SH
+term)
+16 PetroChina
+(10-year
+Tranche)
+(Second
+Bond
+Corporate
+2016
+January
+19, 2016
+January
+18, 2016
+02 136165.SH
+term)
+16 PetroChina
+(10-year
+Tranche)
+Bond (First
+Corporate
+2016
+March
+15, 2023
+March
+15, 2013
+March
+15, 2013
+02 122240.SH
+term)
+13 PetroChina
+Bond (Third
+Tranche)
+(10-year
+16 PetroChina
+Exchange
+and one lump
+of interests,
+Annual payment
+47 3.50 maturity
+sum repayment Shanghai
+of principal at Stock
+Exchange
+Stock
+and one lump
+Annual payment
+of interests,
+40 4.88 maturity
+sum repayment Shanghai
+of principal at
+Exchange
+Stock
+23 3.70 maturity
+Annual payment
+of interests,
+and one lump
+March
+24, 2026
+March
+3, 2026
+January
+19, 2026
+January
+24, 2019
+March
+24, 2016
+January
+22, 2019
+IB
+19 PetroChina 101900113.
+MTN001
+term Notes
+(MTN)
+Tranche
+Medium-
+2019 First
+March
+22, 2016
+06 136319.SH
+term)
+January
+24, 2024
+Tranche)
+On July 20, 2021, the Company held the tenth meeting
+of the eighth session of Board of Directors and appointed
+Mr. Sun Longde as the Chief Geologist (concurrently), Mr.
+Zhang Minglu as the Safety Director and Mr. Zhu Guowen
+as the Vice President of the Company.
+On May 10, 2021, Mr. Li Fanrong resigned from the
+position of Non-executive Director and Vice Chairman
+of the Company and chairman of the Investment and
+Development Committee due to work arrangement.
+Normal, Comply
+(First Tranche) (10-year
+40
+40
+40
+with relevant
+N/A
+Yes
+term)
+undertakings
+2016 Corporate Bond
+Normal, Comply
+(First Tranche) (10-year
+47
+47
+with relevant
+N/A
+Yes
+term)
+undertakings
+2016 Corporate Bond
+Normal, Comply
+(Second Tranche) (10-
+23
+23
+with relevant
+N/A
+Yes
+year term)
+2013 Corporate Bond
+undertakings
+undertakings
+Yes
+RELEVANT INFORMATION ON CORPORATE BONDS
+Total
+Bond Name
+amount Utilized Unutilized
+raised amount amount
+2012 Corporate Bond
+Operation of the
+specific account
+for proceeds
+(if any)
+Normal, Comply
+Unit: 100 million Currency: RMB
+Rectification
+of the
+irregular use
+of proceeds
+(if any)
+Whether the utilization
+is in accordance with
+the purposes, plans
+and other matters
+as undertaken in the
+offering circular
+(First Tranche) (10-year
+term)
+20
+20
+with relevant
+N/A
+Yes
+undertakings
+2012 Corporate Bond
+Normal, Comply
+(First Tranche) (15-year
+20
+20
+20
+with relevant
+N/A
+term)
+2016 Corporate Bond
+(Third Tranche) (10-year
+term)
+20
+100
+with relevant
+N/A
+Yes
+undertakings
+Normal, Comply
+2019 Fifth Tranche MTN
+100
+100
+with relevant
+N/A
+Yes
+undertakings
+Normal, Comply
+2020 First Tranche MTN
+100
+100
+with relevant
+N/A
+Yes
+undertakings
+Normal, Comply
+2020 Second Tranche
+MTN
+100
+100
+with relevant
+N/A
+Yes
+undertakings
+100
+2019 Fourth Tranche MTN
+Normal, Comply
+undertakings
+20
+20
+Normal, Comply
+with relevant
+N/A
+Yes
+undertakings
+Normal, Comply
+2019 First Tranche MTN
+100
+100
+with relevant
+N/A
+Yes
+2021 ANNUAL REPORT 105
+undertakings
+Normal, Comply
+100
+100
+with relevant
+N/A
+Yes
+undertakings
+Normal, Comply
+2019 Third Tranche MTN
+100
+100
+with relevant
+N/A
+Yes
+2019 Second Tranche
+MTN
+On May 28, 2021, Mr. Li Wendong resigned from his
+position as an employee representative Supervisor of the
+Company due to work arrangement.
+Collection of funds raised by issuing bonds and payment of principals and interests are made through the payment
+collection account or special account, and all accounts are under normal operation. Meanwhile, the Company formulated
+a plan for the use of funds raised via bonds and funds raised by issuing corporate bonds are used in accordance with
+the internal procedures on fund utilization and applicable agreements. Relevant business departments carried out strict
+inspections over the use of such funds to effectively ensure that all funds are used for their designated purposes, guarantee
+the smooth operation of the investment, use and audit of funds raised and ensure that the funds raised via bonds are used
+in accordance with the resolution of the Shareholders' General Meeting and the purpose as disclosed in the offering
+circular.
+3. Use of Funds Raised by Issuing Bonds
+National
+Inter-bank
+Bond
+Market
+National
+Inter-bank
+Bond
+Market
+National
+Inter-bank
+Bond
+Market
+National
+Inter-bank
+Bond
+Market
+Notes:
+1. Trading venue: the trading venue for 12 PetroChina 02, 12 PetroChina 03, 13 PetroChina 02, 16 PetroChina 02, 16 PetroChina 04
+and 16 PetroChina 06 is the Shanghai Stock Exchange, and the trading venue for 19 PetroChina MTN001, 19 PetroChina MTN002,
+19 PetroChina MTN003, 19 PetroChina MTN004, 19 PetroChina MTN005, 20 PetroChina MTN001 and 20 PetroChina MTN002 is the
+national inter-bank bond market.
+2. Repayment of principal and payment of interest: for 12 PetroChina 02, 12 PetroChina 03, 13 PetroChina 02, 16 PetroChina 02, 16
+PetroChina 04, 16 PetroChina 06, 19 PetroChina MTN001, 19 PetroChina MTN002, 19 PetroChina MTN003, 19 PetroChina MTN004, 19
+PetroChina MTN005, 20 PetroChina MTN001 and 20 PetroChina MTN002, payment of interests shall be made annually, and one lump
+sum repayment of principal shall be made at maturity.
+3. Investor suitability arrangements: 12 PetroChina 02, 12 PetroChina 03 and 13 PetroChina 02 are offered and traded publicly to public
+investors (ordinary investors); 16 PetroChina 02, 16 PetroChina 04 and 16 PetroChina 06 are offered and traded publicly to qualified
+investors (professional investors); 19 PetroChina MTN001, 19 PetroChina MTN002, 19 PetroChina MTN003, 19 PetroChina MTN004, 19
+PetroChina MTN005, 20 PetroChina MTN001 and 20 PetroChina MTN002 are offered and traded publicly to institutional investors in the
+national inter-bank bond market.
+2021 ANNUAL REPORT 103
+RELEVANT INFORMATION ON CORPORATE BONDS
+4. Applicable trading mechanisms: auction trading and block trading at Shanghai Stock Exchange are applicable to 12 PetroChina 02,
+12 PetroChina 03, 13 PetroChina 02, 16 PetroChina 02, 16 PetroChina 04 and 16 PetroChina 06. Circulation and transfer in the national
+inter-bank bond market are applicable to 19 PetroChina MTN001, 19 PetroChina MTN002, 19 PetroChina MTN003, 19 PetroChina
+MTN004, 19 PetroChina MTN005, 20 PetroChina MTN001 and 20 PetroChina MTN002.
+5. Interest Payment and Redemption: The principal and interest of 21 PetroChina SCP001, 21 PetroChina SCP002, 16 PetroChina MTN001,
+16 PetroChina 01, 16 PetroChina 03, 16 PetroChina 05 were duly paid. The interest of 20 PetroChina MTN001, 20 PetroChina MTN002, 19
+PetroChina MTN001, 19 PetroChina MTN002, 19 PetroChina MTN003, 19 PetroChina MTN004, 19 PetroChina MTN005, 16 PetroChina
+02, 16 PetroChina 04, 16 PetroChina 06, 13 PetroChina 02, 12 PetroChina 02, 12 PetroChina 03 was duly paid.
+6. There are no overdue bonds issued by the Company, and there is no risk of termination of listing and trading of the bonds issued by
+the Company.
+7. Triggering and implementation of special clauses: 19 PetroChina MTN001 and 19 PetroChina MTN002 are attached with the option of
+the issuer to adjust the coupon rate and the put option of the investors by the end of the third year. Relevant clauses have not been
+triggered during the reporting period.
+2. Agencies Providing Services on the Issuance and the Duration of Bonds
+(1) Lead underwriters, trustees, duration management institutions, law firms and rating agencies
+Name
+CSC Financial Co., Ltd.
+Bank of Ningbo Co., Ltd.
+Industrial and Commercial Bank of
+China Limited
+China Minsheng Bank Corp., Ltd
+Bank of China Limited
+Postal Savings Bank of China Co.,
+Ltd
+China Galaxy Securities Company
+Limited
+CITIC Securities Company Limited
+China International Capital
+Corporation Limited
+China Merchants Securities Co., Ltd.
+BOC International (China) Co., Ltd.
+Address
+National
+Inter-bank
+Bond
+Market
+2/F, Towers B and E, Kaiheng Center, 2 Chaonei Street,
+Dongcheng District, Beijing
+National
+Inter-bank
+Bond
+Market
+April 9,
+2023
+On April 29, 2021, the Company held the ninth
+meeting of the eighth session of Board of Directors
+and appointed Mr. Yang Jigang as the Chief Engineer
+(concurrently) of the Company.
+On March 25, 2021, the Company held the eighth
+meeting of the eighth session of Board of Directors. Mr.
+Huang Yongzhang was appointed as the President and re-
+designated to be an Executive Director of the Company;
+Mr. Duan Liangwei ceased to serve as the President
+and re-designated to be a Non-executive Director of the
+Company.
+2. Change in Directors, Supervisors and the
+Senior Management
+was appointed as the General Manager of Daqing Oilfield
+Co., Ltd. and concurrently served as the general manager
+of Daqing Petroleum Administration Bureau Co., Ltd. In
+June 2021, he was appointed as the executive director
+of Daqing Oilfield Co., Ltd. and concurrently served as
+the executive director of Daqing Petroleum Administration
+Bureau Co., Ltd. In July 2021, he was appointed as the
+Vice President of the Company.
+Zhu Guowen, aged 55, is the Vice President of
+the Company, and concurrently serves as the executive
+director of Daqing Oilfield Co., Ltd., and executive director
+of Daqing Petroleum Administration Bureau Co., Ltd. Mr.
+Zhu is a professor-level senior engineer with a doctorate
+degree, and has extensive experience in the oil and gas
+industry in the PRC. In March 2010, he was appointed as
+the plant manager of the First Production Plant of Daqing
+Oilfield Co., Ltd. In April 2013, he was appointed as the
+deputy general manager of Daqing Oilfield Co., Ltd.
+and deputy director of Daqing Petroleum Administration
+Bureau. In October 2018, he was appointed as the general
+manager of Zhejiang Oilfield Branch. In October 2020, he
+Zhang Minglu, aged 58, is the Chief Safety Director
+of the Company and concurrently serves as the deputy
+safety director of CNPC, the general manager of the
+Quality, Health, Safety and Environment Department of
+the Company and concurrently as the general manager of
+the Quality, Health, Safety and Environment Department
+of CNPC. Mr. Zhang is a professor-level senior engineer
+with a doctorate degree, and has extensive experience in
+the oil and gas industry in the PRC. In June 2008, he was
+appointed as the chief geologist of Changqing Oilfield
+Branch. In July 2014, he was appointed as the deputy
+general manager of Changqing Oilfield Branch, and
+concurrently served as safety director of the Changqing
+Oilfield Branch in January 2015. In January 2019, he
+was appointed as general manager of Qinghai Oilfield
+Branch, and the executive director and general manager
+of Qinghai Petroleum Administration Bureau Co., Ltd. In
+March 2021, he was appointed as the general manager of
+the Quality, Health, Safety and Environmental Department
+of the Company and concurrently served as the general
+manager of the Quality, Health, Safety and Environmental
+Department of CNPC. In June 2021, he was appointed
+as deputy safety director of CNPC. In July 2021, he was
+appointed as Safety Director of the Company.
+as a Vice President of the Company from December 2017.
+From April 2021, he concurrently served as the Chief
+Engineer of the Company.
+DIRECTORS, SUPERVISORS, SENIOR MANAGEMENT AND EMPLOYEES
+2021 ANNUAL REPORT 097
+Yang Jigang, aged 58, is a Vice President and
+Chief Engineer of the Company. Mr. Yang is a professor-
+level senior engineer and holds a master's degree. He
+has rich working experience in China's petroleum and
+petrochemical industry. He worked as the deputy general
+manager of Lanzhou Chemical Industry Company from
+August 1997, the chief engineer of CNPC Refining and
+Chemical Department from November 1998, member of
+the preparatory committee of Refining and Sales Branch
+from September 1999, the chief engineer and member of
+the Party committee of Refining and Sales Branch from
+December 1999, the deputy general manager, chief
+engineer and member of the Party committee of Chemical
+and Sales Branch from August 2000, the general manager
+and vice Party secretariat of Daqing Petrochemical Branch
+from May 2005, the Party secretariat and deputy general
+manager of Refining & Chemical Branch from December
+2009, and the Party secretariat and general manager of
+Refining & Chemical Branch from November 2017. From
+March 2021, he serves as the executive director of the
+Refining and Chemical Branch. Mr. Yang was appointed
+Chai Shouping, aged 60, is currently the Chief
+Financial Officer and Secretary to the Board of the
+Company. Mr. Chai is a professor-level senior accountant
+and holds a master's degree. He has rich financial,
+operating, and managerial experience in the oil and gas
+industry of the PRC. From April 2002, he worked as the
+deputy general manager of the Finance Department of the
+Company. From September 2012, he served as the chief
+accountant and member of the Party committee of CNPC
+E&D (Overseas Exploration and Development branch),
+the deputy general manager and chief financial officer
+of CNPC E&D, the chief financial officer of PetroChina
+International Investment Company Limited. From March
+2013, he served as the general manager of the Finance
+Department of the Company. Mr. Chai was appointed as
+the Chief Financial Officer of the Company in January
+2017. From August 2020, Mr. Chai concurrently served as
+the director of the Secretariat of the Board. Since October
+2020, Mr. Chai concurrently served as the Secretary of the
+Board of the Company.
+Tian Jinghui, aged 59, is a Vice President of the
+Company, and concurrently the Party secretariat and
+executive director of PetroChina International Co.,
+Ltd., and the Chairman of China National United Oil
+Corporation. Mr. Tian is a professor-level senior economist
+with a master's degree of business administration. He
+has rich experience in the oil and gas industry of the
+PRC. From May 1998, he was appointed as the leader
+of the Preparatory Group of Northwest Sales Company.
+He worked as the deputy general manager and member
+of the Party committee of Refining & Marketing Branch
+from December 1999, the deputy general manager,
+chief safety officer and member of the Party committee
+of Marketing Branch from November 2007. From June
+2009, he assumed the position as the Party secretariat
+and deputy general manager of Marketing Branch. From
+August 2013, he has been the general manager and Party
+secretariat of Marketing Branch. Mr. Tian was appointed
+as Vice President of the Company in November 2015.
+From April 2017, Mr. Tian served concurrently as the
+general manager and vice Party secretariat of PetroChina
+Marketing Branch, the Party secretariat and executive
+director of PetroChina International Co., Ltd., and the
+chairman of China National United Oil Corporation.
+and Gas Field Branch from September 1999, the general
+manager and vice Party secretariat of Southwest Oil and
+Gas Field Branch from September 2003, the general
+manager and Party secretariat of Southwest Oil and
+Gas Field Branch from November 2005, assistant to the
+general manager of CNPC from April 2014, concurrently
+as the general manager and vice secretariat of the Party
+committee of Tarim Oilfield Branch from October 2016,
+and the general manager and secretariat of the Party
+committee of Tarim Oilfield Branch from April 2017, the
+general manager and vice Party secretariat of Exploration
+and Production Branch from April 2018 and the vice
+president of the Company from June 2018. From October
+2020, Mr. Li concurrently served as the executive director
+and secretary of the Party committee of the Exploration
+and Production Branch.
+PetroChina
+DIRECTORS, SUPERVISORS, SENIOR MANAGEMENT AND EMPLOYEES
+Annual payment
+of interests,
+and one lump
+sum repayment
+of principal at
+100 3.66 maturity
+Annual payment
+of interests,
+and one lump
+sum repayment
+of principal at
+100 3.96 maturity
+Annual payment
+of interests,
+and one lump
+sum repayment
+of principal at
+100 2.42 maturity
+Annual payment
+of interests,
+and one lump
+sum repayment
+of principal at
+2020 Second
+Tranche
+MTN
+20 PetroChina 102000622.
+MTN002
+IB
+April 8,
+2020
+April 9,
+2020
+100 2.42 maturity
+Block B, 6 Jianguomenwai Street, Chaoyang District,
+Beijing
+55 Fuxingmennei Street, Xicheng District, Beijing
+2 Fuxingmennei Street, Xicheng District, Beijing
+1 Fuxingmennei Street, Xicheng District, Beijing
+China Orient Asset Building, 410 Fuchengmennei
+Street, Xicheng District, Beijing
+104
+PETROCHINA COMPANY LIMITED
+(2) Accounting firms
+RELEVANT INFORMATION ON CORPORATE BONDS
+Name
+PricewaterhouseCoopers Zhong
+Tian LLP (Special General
+Partnership)
+KPMG Huazhen LLP (Special
+General Partnership)
+Address
+11/F, PricewaterhouseCoopers Center
+2 Corporate Avenue, 202 Hu Bin Road,
+Huangpu District, Shanghai
+8/F, KPMG Tower, Oriental Plaza, 1 East
+Chang An Avenue, Beijing
+Signing
+Accountant
+PetroChina
+Contact
+Telephone
+Zhao Juan,
+Li Dan
+Hu Yang
+010-65333602
+Yang Jie,
+He Shu
+Liu Yang
+010-85085264
+(3) Change of agencies during the reporting period
+Name
+PricewaterhouseCoopers
+Zhong Tian LLP (Special
+General Partnership) and
+PricewaterhouseCoopers
+Reason to change
+The Company has hired KPMG
+Huazhen LLP (Special General
+Partnership) and KPMG as
+auditors for financial and
+internal control since 2013
+and they have reached the
+maximum years of audit services
+that an accounting firm can
+continuously provide. Hence, the
+Company proposed to engage
+PricewaterhouseCoopers
+Zhong Tian LLP (Special
+General Partnership) and
+PricewaterhouseCoopers as the
+Company's auditors for financial
+and internal control for the year
+of 2021.
+Procedure
+From 24 to 25 March 2021, the
+Company convened the eighth
+meeting of the eighth session
+of the Board and passed the
+resolution "To change the
+domestic and international
+auditors of the Company for the
+year 2021". On 10 June 2021,
+the Company convened the
+2020 annual general meeting
+and passed the resolution
+"To change the domestic and
+overseas auditor of the Company
+for the year of 2021".
+Effect to the equity of the
+bond investor
+The change of the
+accounting firm falls within
+the scope of the ordinary
+business activities of the
+Company and abided by
+the laws and regulations,
+and Articles of Association
+of the Company. Such
+change will not have a
+significant adverse effect
+on the daily operation
+and the solvency of the
+Company.
+20/F, Huarun Tower, 8 Jianguomen North Street,
+Dongcheng District, Beijing
+Beijing
+010-85679696
+Luo Yi
+11/F, Qinghai Finance Building, Building 1, 8 Xiying
+Street, Fengtai District, Beijing
+CITIC Securities Tower, 48 Liangmaqiao Road,
+Chaoyang District, Beijing
+27/F & 28/F, China World Tower 2, 1 Jianguomenwai
+Street, Chaoyang District, Beijing
+17/F, Merchants Bank Building, Building 3, 1 Yuetan
+South Street, Xicheng District, Beijing
+39/F, Bank of China Tower, 200 Yincheng Middle Road,
+Pudong New Area, Shanghai
+China Development Bank Securities 1-9/F, 29 Fuchengmenwai Street, Xicheng District,
+Co., Ltd
+Contact
+Li Wenjie
+Telephone
+010-86451097
+Zhang Pengfei 010-53266150
+Zhang Jian
+Lian Jie
+Xun Yamei
+010-81011847
+010-86603645
+010-66592749
+Zheng Yarong 010-68857446
+Zhang Fan
+010-80927272
+As at the end of the current reporting period, the use of all funds raised via bonds is basically consistent with the
+purpose, use plan and other matters as undertaken in the offering circular, and such funds have been used up.
+Sun Xiaobo 010-60834068
+010-65051166
+Zhao Xin
+010-60840890
+Chen Zhili
+010-66229000
+Zhao Liang
+010-88300901
+Junhe Law Office
+Lei Tianxiao
+010-85191300
+China Lianhe Credit Rating
+Co., Ltd.
+China Chengxin International Credit Building 5, Yinhe SOHO, 2 Nanzhugan Alley,
+Rating Co.
+Chaoyangmennei Street, Dongcheng District, Beijing
+17/F, PICC Building, 2 Jianguomenwai Street, Chaoyang
+District, Beijing
+Annual payment
+of interests,
+and one lump
+sum repayment
+of principal at
+010-66428877
+Xu Xian
+Li Xuewei
+100 3.66 maturity
+PwC ZT Shen Zi (2022) No. 10001
+(Page 2 of 6)
+1.8
+145.8
+Dry well(3)
+15
+22
+228
+73
+132
+401.3
+2020
+The net number of new development wells(2)
+3,264
+1,048
+4,630
+4.3
+53
+9
+9
+The net number of new exploration wells(2)
+166
+151
+661
+561
+24.0
+1,563.0
+Crude oil
+142
+120
+380
+356
+17.9
+1,015.9
+Natural gas
+3,121
+72.0
+210.5
+Crude oil
+207
+149
+604
+496
+23.3
+1,479.3
+The net number of new exploration wells(2)
+Crude oil
+86
+371
+280
+15.6
+912.6
+Natural gas
+160
+63.0
+14
+36
+3,240
+1,040
+3,082
+2,406
+209.5
+9,977.5
+Natural gas
+11
+8
+1,512
+701
+1.0
+2,233.0
+Dry well(3)
+13
+12,273.5
+23
+43
+6
+Daqing Xinjiang Changqing
+Other
+domestic (1)
+Overseas
+aggregate
+Total
+The net number of new exploration wells(2)
+Crude oil
+211
+Year
+157
+627
+34.6
+1,613.6
+195
+148
+359
+584
+The number of wells drilled or participated in drilling during the specified period the results of the drilling are set out
+as follow:
+As at December 31, 2021, the aggregate of proved developed and undeveloped reserves of the Group and its affiliate
+companies and joint ventures calculated by the equity method is 18.844 billion barrels of oil equivalent (as at December 31,
+2020: 18.202 billion barrels of oil equivalent), of which crude oil and condensate are 6.272 billion barrels (as at December
+31, 2020: 5.402 billion barrels), natural gas is 75,427.3 billion cubic feet (as at December 31, 2020: 76,799.8 billion cubic
+feet).
+INFORMATION ON CRUDE OIL AND NATURAL GAS RESERVES
+Share of proved developed and undeveloped reserves
+of affiliates and joint ventures
+December 31, 2019
+287.1
+393.6
+December 31, 2020
+195.5
+362.7
+December 31, 2021
+208.5
+511.4
+352.7
+256.0
+293.7
+Note: Crude oil and condensate reserves contained 278.9 million barrels of Natural Gas Liquids ("NGL") in 2021.
+2021 ANNUAL REPORT
+109
+381
+23.5
+1,106.5
+Natural gas
+Crude oil
+2,990
+1,270
+4,319
+3,243
+469.2
+12,291.2
+Natural gas
+12
+4
+1,586
+1,007
+9.6
+2,618.6
+Dry well(3)
+478.8 14,981.8
+17
+4,273
+1,274
+2
+9
+49
+109
+1.8
+170.8
+Dry well (3)
+14
+176
+137
+9.3
+336.3
+2019
+The net number of new development wells(2)
+3,008
+5,948
+17
+43
+98
+the consolidated and company balance sheets as at 31 December 2021;
+•
+We have audited the accompanying financial statements of PetroChina Company Limited ("the Company"), which
+comprise:
+What we have audited
+Opinion
+To the Shareholders of PetroChina Company Limited,
+• the consolidated and company income statements for the year then ended;
+PwC ZT Shen Zi (2022) No. 10001
+(Page 1 of 6)
+AUDITOR'S REPORT
+pwc
+111
+2021 ANNUAL REPORT
+At the same time, the Company retains a third party
+independent evaluator who will, in accordance with the
+SEC Standards prescribed, conduct an independent
+evaluation or audit of the proved reserves derived from
+the annual evaluation conducted by the Company. The
+proved reserves evaluated or audited by the third party will
+be disclosed in accordance with the SEC requirements.
+Production segment. Mr. Duan holds a bachelor's degree
+in petroleum geology and an MBA degree. He has more
+than 25 years of working experience in the field of the
+exploration and development of oil and gas and has been
+engaging in the reserve evaluation and management for
+a long period of time. Since 2008, he has been involved
+in the technical supervision of reserves evaluation and,
+since 2016, has been the key technical professional in
+charge of monitoring the preparations for conducting
+reserve evaluation of the Company and of handling the
+technical and management works regarding evaluation
+of the oil and gas reserves. Reserve Research Institutes
+in various regions are responsible for calculating the
+newly discovered reserves and updating the estimates of
+the existing reserves. The evaluation results are subject
+to a two-level review by the regional companies and the
+Exploration and Production branches, and will be finally
+determined by the Reserve Evaluation Leading Group of
+the Company.
+普华永道
+• the consolidated and company cash flow statements for the year then ended;
+•
+the consolidated and company statements of changes in shareholders' equity for the year then ended; and
+Key audit matter identified in our audit is “Recoverability of the carrying amount of oil and gas properties".
+Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the
+financial statements of the current period. These matters were addressed in the context of our audit of the financial
+statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
+118
+普华永道
+Key Audit Matters
+AUDITOR'S REPORT (continued)
+pwc
+112 PETROCHINA COMPANY LIMITED
+PricewaterhouseCoopers Zhong Tian LLP, 11/F PricewaterhouseCoopers Center
+Link Square 2, 202 Hu Bin Road, Huangpu District, Shanghai 200021, PRC
+T: +86 (21) 2323 8888, F: +86 (21) 2323 8800, www.pwccn.com
+We are independent of the Company in accordance with the Code of Ethics for Professional Accountants of the
+Chinese Institute of Certified Public Accountants ("CICPA Code"), and we have fulfilled our other ethical responsibilities in
+accordance with the CICPA Code.
+We conducted our audit in accordance with China Standards on Auditing ("CSAS"). Our responsibilities under those
+standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of
+our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
+opinion.
+Basis for Opinion
+In our opinion, the accompanying financial statements present fairly, in all material respects, the consolidated and
+company's financial position of the Company as at 31 December 2021, and their financial performance and cash flows
+for the year then ended in accordance with the requirements of Accounting Standards for Business Enterprises ("CASS").
+Our opinion
+• notes to the financial statements.
+The Company promoted the qualification certification
+management of oil and gas reserve evaluation and audit
+personnel, and has set up a team of reserve valuers and
+auditors covering the headquarters and companies in
+various regions which is responsible for reserve valuing
+and auditing for the Company. Meanwhile, a specialised
+Reserve Administration Department is set up under the
+Exploration and Production segment of the Company.
+The managerial personnel and staff of such department
+possess on average more than 20 years of professional
+technical experience and a considerable number of
+years of experience in conducting reserve estimation U.S.
+Securities and Exchange Commission ("SEC") Standards
+in the oil industry, and all of them are qualified as the
+national certified professionals specialising in handling
+reserves matters. Reserve Management Committees
+and multi-disciplinary Reserve Research Institutes have
+been set up at various regional companies. Technical
+professional in charge of the reserve evaluation of the
+Company is Mr. Duan Xiaowen, member of the Reserve
+Administration Department of the Exploration and
+The Company has set up the Oil and Gas Reserves
+Management Committee, the chairman of which is the
+President of the Company.
+Internal Control over the Estimates of
+Reserves
+PetroChina
+9,386.2
+262.2
+2,539
+2,483
+732
+3,370
+Crude oil
+11,622.4
+266.4
+3,199
+4,034
+736
+3,387
+The net number of new development wells(2)
+2021
+Natural gas
+Dry well (3)
+Key Audit Matter
+6
+1,518
+INFORMATION ON CRUDE OIL AND NATURAL GAS RESERVES
+PETROCHINA COMPANY LIMITED
+110
+(3) "dry well" means wells which are not sufficient for commercial production.
+(2) "net well" means wells which have deducted the interests of other parties.
+etc.
+(1) represents Liaohe, Jilin, North China, Dagang, Sichuan, Tarim, Turpan Hami, Qinghai, Jidong, Yumen, Zhejiang and southern oil region,
+Notes:
+54.0
+10
+33
+11
+2,182.2
+4.2
+650
+4
+Investment calculated by the equity method
+Recoverability of the carrying amount of oil and
+gas properties
+Uncertainty in future oil prices, future production
+costs, changes in operating conditions and the
+economic outlook gave rise to possible indicators
+that the carrying amount of the oil and gas
+properties as at December 31, 2021 might be
+impaired.
+AUDITOR'S REPORT (continued)
+pwc
+115
+2021 ANNUAL REPORT
+Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
+appropriate in the circumstances.
+•
+普华永道
+• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design
+and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate
+to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than
+for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the
+override of internal control.
+Our objectives are to obtain reasonable assurance about whether these financial statements as a whole are free
+from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion.
+Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with
+CSAS will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are
+considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic
+decisions of users taken on the basis of these financial statements.
+Auditor's Responsibilities for the Audit of the Financial Statements
+Those charged with governance are responsible for overseeing the Company's financial reporting process.
+In preparing these financial statements, management is responsible for assessing the Company's ability to continue
+as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis
+of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic
+alternative but to do so.
+Management of the Company is responsible for the preparation and fair presentation of these financial statements
+in accordance with the CASS, and for such internal control as management determines is necessary to enable the
+preparation of financial statements that are free from material misstatement, whether due to fraud or error.
+Responsibilities of Management and Those Charged with Governance for the Financial Statements
+As part of an audit in accordance with CSAs, we exercise professional judgment and maintain professional scepticism
+throughout the audit. We also:
+PwC ZT Shen Zi (2022) No. 10001
+(Page 5 of 6)
+Auditor's Responsibilities for the Audit of the Financial Statements (Cont'd)
+•
+1.1
+176.1
+Dry well(3)
+30
+46
+190
+PETROCHINA COMPANY LIMITED
+116
+We also provide those charged with governance with a statement that we have complied with relevant ethical
+requirements regarding independence, and to communicate with them all relationships and other matters that may
+reasonably be thought to bear on our independence, and where applicable, related safeguards.
+We communicate with those charged with governance regarding, among other matters, the planned scope and timing of
+the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our
+audit.
+Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities
+within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction,
+supervision and performance of the group audit. We remain solely responsible for our audit opinion.
+Evaluate the overall presentation (including the disclosures), structure and content of the financial statements, and
+whether the financial statements represent the underlying transactions and events in a manner that achieves fair
+presentation.
+Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the
+audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant
+doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we
+are required to draw attention in our auditor's report to the related disclosures in these financial statements or, if such
+disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to
+the date of our auditor's report. However, future events or conditions may cause the Company to cease to continue
+as a going concern.
+Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related
+disclosures made by management.
+•
+PwC ZT Shen Zi (2022) No. 10001
+(Page 4 of 6)
+普华永道
+AUDITOR'S REPORT (continued)
+pwc
+2021 ANNUAL REPORT 113
+Compared the future cost profiles against historical costs
+or relevant budgets of the Group or relevant external data;
+• Compared estimates of future crude oil prices adopted
+by the Group against a range of published crude oil price
+forecasts;
+For certain projects which management has decided
+not to further develop, corroborated evidence of future
+development plans and capital allocation decisions;
+Assessed the appropriateness of the method used
+to determine recoverable amounts, including the
+methodology adopted in the discounted cash flow
+projections, tested mathematical accuracy of the
+projections, and the completeness, accuracy, and
+relevance of underlying data used in the projections;
+Evaluated and tested the key controls relating to the
+determination of recoverable amounts of oil and gas
+properties;
+Obtained an understanding of the management's internal
+control and assessment process of impairment of oil and
+gas properties and assessed the inherent risk of material
+misstatement by considering the degree of estimation
+uncertainty and level of other inherent risk factors such
+as complexity, subjectivity, changes and susceptibility to
+management bias or fraud;
+•
+•
+In addressing this matter, we performed the following key
+audit procedures:
+How our audit addressed the Key Audit Matter
+- Discount rates.
+- Future production volumes; and
+- Future costs;
+- Future oil prices;
+An impairment loss is recognised for the amount
+by which the carrying amount of oil and gas
+properties exceeds the higher of its fair value less
+costs to sell and its value in use. The Group's
+determination of the recoverable amounts for oil
+and gas properties involved key estimates and
+assumptions, including:
+pwc
+Refer to Note 4(31) "Critical accounting
+estimates and judgements” and Note 17 "Oil
+and gas properties" to the consolidated financial
+statements, with the net book value of oil and gas
+properties amounted to RMB 816,788 million at
+31 December 2021, and impairment loss of RMB
+19,463 million was recorded for the year ended
+31 December 2021.
+AUDITOR'S REPORT (continued)
+PwC ZT Shen Zi (2022) No. 10001
+(Page 3 of 6)
+PETROCHINA COMPANY LIMITED
+114
+In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so,
+consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained
+in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that
+there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in
+this regard.
+Our opinion on the financial statements does not cover the other information and we do not express any form of
+assurance conclusion thereon.
+Management of the Company is responsible for the other information. The other information comprises all of the
+information included in 2021 annual report of the Company other than the financial statements and our auditor's report
+thereon.
+Other Information
+Based on our work, we found the key estimations and
+assumptions and input data adopted by management in
+determining the recoverable amounts were supported by the
+evidence we obtained.
+Used professionals with specialized skill and knowledge to
+assist in the evaluation of the appropriateness of discount
+rates adopted by the management.
+Compared the future production profiles against the
+oil and gas reserve estimation report approved by the
+management. Evaluated the competence, capability
+and objectivity of the management's experts engaged
+in estimating the oil and gas reserves. Assessed key
+estimations or assumptions used in the reserve estimation,
+by reference to historical data, management plans and/or
+relevant external data;
+•
+•
+How our audit addressed the Key Audit Matter
+Because of the significance of the carrying
+amount of the oil and gas properties as at
+December 31, 2021, together with the significant
+estimates and judgements by management
+in the use of key estimates or assumptions in
+determining recoverable amounts for oil and gas
+properties, we had placed our audit emphasis on
+this matter.
+Key Audit Matter
+Key Audit Matters (Cont'd)
+普华永道
+240.3
+223.8
+203.0
+Note: EBITDA increased by 36.1% and interest coverage ratio increased by 11.60 compared with the same period of last year, mainly due
+to the significant year-on-year increase of sales revenue and total profit.
+108 PETROCHINA COMPANY LIMITED
+INFORMATION ON CRUDE OIL AND NATURAL GAS RESERVES
+PetroChina
+INFORMATION ON CRUDE OIL AND
+NATURAL GAS RESERVES
+The following table sets forth the Company's estimated proved reserves and proved developed reserves as at
+December 31, 2019, 2020 and 2021, among which approximately 57% of the proved reserve as at December 31 2021, 54%
+of the proved reserve as at December 31 2020 and 54% of the proved reserves as at December 31 2019 are formulated on
+the basis of the self-assessment results prepared by the Company, and the remaining reserves as at December 31, 2019,
+2020 and 2021 are formulated on the basis of assessment results prepared by DeGolyer and MacNaughton, McDaniel &
+Associates, Ryder Scott and GLJ, each an independent engineering consultancy company.
+Proved Developed and Undeveloped Reserves
+The group
+Crude Oil and
+Condensate
+(million barrels)
+Natural Gas
+(billion cubic feet)
+Combined
+(million barrels of oil
+equivalent)
+Reserves as of December 31, 2019 (the basis date)
+Revisions of previous estimates
+7,253.3
+76,236.0
+(1,553.1)
+(595.3)
+Extensions and discoveries
+(921.8)
+Production for the year
+(91.1)
+(65.6)
+(80.2)
+Sold
+100
+19,959.3
+(1,652.2)
+1,214.6
+107.7
+32.8
+15.0
+Purchased
+107.7
+Improved recovery
+4,976.1
+385.2
+106.9
+100
+Interest coverage ratio (%)
+100
+Asset-liability ratio (%)
+Quick ratio
+0.80
+0.93
+Liquidity ratio
+118,631
+EBITDA-debt ratio
+136,789
+390.6
+(107,971)
+Net cash flow from financing activities (RMB million)
+(181,986)
+(213,032)
+Net cash flow from investing activities (RMB million)
+Year-end balance of cash and cash equivalents (RMB million)
+(4,221.0)
+Debt service coverage ratio
+EBITDA interest coverage ratio
+100
+Loan repayment ratio (%)
+17.55
+36.05
+21.22
+29.70
+Cash debt service coverage ratio
+5.16
+0.76
+1.12
+45.07
+43.69
+0.59
+0.65
+16.76
+(1,625.5)
+Reserves as of December 31, 2020 (the basis date)
+5,206.1
+666.6
+Overseas
+10,775.8
+40,732.3
+3,987.0
+11,666.4
+1,344.4
+42,076.7
+As of December 31, 2020 (the basis date)
+Including: Domestic
+882.7
+1,493.3
+633.8
+Overseas
+11,236.0
+4,653.6
+38,376.3
+890.6
+5,374.8
+Including: Domestic
+36,366.4
+1,779.5
+As of December 31, 2019 (the basis date)
+Proved Undeveloped Reserves
+780.5
+As of December 31, 2021 (the basis date)
+Including: Domestic
+1,232.1
+Overseas
+11,690.2
+41,343.5
+4,799.6
+12,470.7
+42,575.6
+575.2
+281,108
+4,840.0
+12,118.7
+(1.9)
+(2.5)
+Sold
+0.0
+Purchased
+116.7
+Production for the year
+Improved recovery
+Extensions and discoveries
+(2,011.6)
+1,159.1
+Revisions of previous estimates
+17,945.6
+76,437.1
+472.3
+Including: Domestic
+(887.9)
+4,885.3
+39,869.6
+5,473.8
+As of December 31, 2019 (the basis date)
+Proved Developed Reserves
+18,549.8
+74,915.9
+(4,420.0)
+6,063.8
+(2.8)
+(1,624.8)
+0.0
+121.2
+824.1
+1,286.5
+0.0
+27.0
+Reserves as of December 31, 2021 (the basis date)
+382,676
+(99,400)
+2020
+36,156.8
+7,840.6
+7,686.0
+Overseas
+119.7
+209.6
+As of December 31, 2020 (the basis date)
+Including: Domestic
+552.5
+34,360.4
+387.9
+34,062.0
+154.6
+6,279.2
+1,659.8
+6,064.9
+164.6
+298.4
+214.3
+As of December 31, 2021 (the basis date)
+Including: Domestic
+689.0
+32,340.3
+6,079.1
+486.0
+32,116.5
+5,838.8
+Overseas
+Overseas
+Earnings before interest, tax, depreciation and amortization (EBITDA) (RMB million)
+6.6
+The aforementioned proceeds raised by issuing bonds were not used in project construction, and the use of the
+proceeds remained unchanged during the reporting period.
+RELEVANT INFORMATION ON CORPORATE BONDS
+PetroChina
+4. Information on Follow-up Credit Rating of Bonds
+During the reporting period, no adjustment was made by the credit rating agencies to the credit rating of the Company
+or bonds.
+5. Credit Enhancement Mechanism, Debt Repayment Plan and Safeguard Measures for Debt
+Repayment
+During the reporting period, the credit enhancement mechanism, debt repayment plan and the safeguard measures
+for debt repayment are consistent with the provisions and relevant undertakings set out in the offering circular, without any
+change made thereto.
+6. Mortgage, Pledge, Seizure, Freezing, Conditional Realisation, Impossible Realisation,
+Impossible Use to Offset Debts of Assets and Other Situations and Arrangements under which
+Rights are Restricted
+As at the end of the reporting period, there was no material restriction on the Company's assets.
+7. Overdue Payment of Interest-bearing Debts (Excluding Bonds) at the End of the Reporting
+Period
+As at the end of the reporting period, the Company has no overdue payment of interest-bearing debts.
+8. Violation of the Laws and Regulations, the Articles of Association, the Management Rules of
+the Information Disclosure and the Promises or Commitments of the Offering Circular Which
+Affects the Interests of the Bond Investors.
+As at the end of the reporting period, the Company does not have the aforementioned circumstances.
+2021 ANNUAL REPORT
+RELEVANT INFORMATION ON CORPORATE BONDS
+9. Major Accounting Data and Financial Indicators Relating to Corporate Bonds
+107
+2021
+Item
+54
+(43,507)
+(22,588)
+(22,039)
+Other comprehensive income, net of tax
+Non-controlling interests
+(12,483)
+Shareholders of the Company
+Classified by ownership:
+Net profit from discontinued operation
+62,745
+84,133
+33,481
+114,687
+62,745
+84,133
+33,481
+75,228
+114,687
+Net profit from continuous operation
+106,172
+120 PETROCHINA COMPANY LIMITED
+Chai Shouping
+1,232,032
+1,585,380
+2,193,695
+2,575,909
+132,521
+Notes The Group The Group The Company The Company
+Cash paid for goods and services
+Cash received relating to other operating activities
+Sub-total of cash inflows
+Cash received from sales of goods and rendering of
+services
+Cash flows from operating activities
+Items
+2020
+2021
+2020
+2021
+99
+(All amounts in RMB millions unless otherwise stated)
+CONSOLIDATED AND COMPANY CASH FLOW STATEMENTS
+FOR THE YEAR ENDED DECEMBER 31, 2021
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS
+Chief Financial Officer
+56
+Other comprehensive income (net of tax) attributable
+to equity holders of the Company
+Total comprehensive income
+Earnings per share
+110,186
+22,351
+83,928
+62,221
+89,552
+14,630
+83,928
+62,221
+20,634
+7,721
+Basic earnings per share (RMB Yuan)
+Attributable to:
+Diluted earnings per share (RMB Yuan)
+55
+0.50
+0.10
+0.46
+0.34
+55
+0.50
+0.10
+0.46
+0.34
+Chairman
+Dai Houliang
+The accompanying notes form an integral part of these financial statements.
+55
+(6,758)
+(1,892)
+Other comprehensive income (net of tax) attributable
+to non-controlling interests
+92,161
+19,002
+84,133
+62,745
+22,526
+14,479
+(4,501)
+(11,130)
+(205)
+(524)
+(2,609)
+(4,372)
+Huang Yongzhang
+(524)
+(1) Item that will not be reclassified to profit or loss:
+Changes in fair value of investments in other
+equity instruments
+79
+(22)
+(30)
+(10)
+(2) Items that may be reclassified to profit or loss:
+Other comprehensive income recognised under
+equity method
+(4)
+(441)
+(175)
+(514)
+Translation differences arising from translation of
+foreign currency financial statements
+(2,684)
+(3,909)
+Director and President
+(205)
+Equity holders of the Company
+Non-controlling interests
+56,069
+FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+CONSOLIDATED AND COMPANY BALANCE SHEETS
+AS OF DECEMBER 31, 2021 (CONTINUED)
+PETROCHINA COMPANY LIMITED
+118 PETROCHINA COMPANY LIMITED
+Chai Shouping
+Chief Financial Officer
+Director and President
+Huang Yongzhang
+Chairman
+Dai Houliang
+The accompanying notes form an integral part of these financial statements.
+1,814,683
+December
+31, 2021
+1,843,950
+2,502,533
+TOTAL ASSETS
+1,614,628
+1,646,548
+2,001,633
+2,021,695
+Total non-current assets
+13,524
+12,786
+36,137
+33,854
+2,488,400
+LIABILITIES AND
+SHAREHOLDERS' EQUITY
+Notes
+237,102
+27
+18,203
+19,369
+19,313
+20,089
+26
+25,923
+23,328
+41,354
+40,010
+12225
+Other payables
+Taxes payable
+Employee compensation payable
+Contracts liabilities
+Accounts payable
+Notes payable
+Short-term borrowings
+Current liabilities
+The Company
+December
+31, 2020
+December
+31, 2021
+The Company
+December
+31, 2020
+The Group
+The Group
+23
+220,318
+Other non-current assets
+11,364
+222,215
+223,671
+18
+Construction in progress
+598,665
+622,093
+813,888
+816,788
+264,241
+259,790
+415,988
+150,829
+418,837
+461,462
+250,698
+265,884
+567
+Oil and gas properties
+Fixed assets
+Long-term equity investments
+427
+388
+910
+1,176
+451,677
+142,470
+Right-of-use assets
+19
+12,161
+36
+Deferred tax assets
+8,980
+8,384
+11,869
+11,391
+22
+Long-term prepaid expenses
+30
+43
+8,125
+7,987
+21
+Goodwill
+65,841
+68,884
+86,101
+90,587
+20
+Intangible assets
+66,765
+61,889
+144,338
+139,359
+2,008
+90,968
+99,276
+28
+1,121,515
+1,093,409
+Total liabilities
+291,249
+336,276
+516,097
+575,251
+Total non-current liabilities
+5,496
+4,678
+10,865
+672,809
+8,795
+7,914
+16,390
+26,654
+36
+Deferred tax liabilities
+81,941
+90,941
+114,819
+129,405
+35
+Provisions
+Other non-current liabilities
+687,888
+Shareholders' equity
+Share capital
+39
+8
+Surplus reserves
+250
+(32,128)
+(34,737)
+56
+Other comprehensive income
+4,708
+4,829
+10,810
+9,231
+Special reserve
+127,044
+127,207
+127,222
+127,375
+38
+183,021
+183,021
+183,021
+183,021
+37
+33
+Capital surplus
+47,983
+47,976
+122,644
+123,222
+32
+32
+liabilities
+Current portion of non-current
+9,956
+Liabilities held for sale
+74,496
+72,324
+56,250
+28,493
+31
+45,769
+51,615
+63,724
+76,774
+30
+6,559
+6,669
+8,649
+8,975
+29
+59,877
+57,698
+91,477
+78,481
+19,893
+14
+81,769
+64,745
+19
+Lease liabilities
+87,000
+85,000
+91,239
+89,170
+34
+Debentures payable
+68,829
+99,767
+160,140
+198,005
+33
+Long-term borrowings
+Non-current liabilities
+396,639
+336,533
+605,418
+518,158
+Total current liabilities
+1,791
+5,918
+12,608
+8,341
+Other current liabilities
+8,644
+15,376
+Investments in other equity
+instruments
+200,055
+45
+(51,701)
+(55,315)
+(30,481)
+(33,558)
+Research and development expenses
+46
+(16,729)
+(15,746)
+(12,613)
+(11,748)
+General and administrative expenses
+Finance expenses
+(17,043)
+(24,304)
+(14,972)
+(20,781)
+Including: Interest expenses
+(19,739)
+(26,528)
+(15,162)
+(20,484)
+Interest income
+2,984
+47
+(49,707)
+(48,777)
+(71,476)
+2021
+2020
+Items
+Operating income
+Less: Cost of sales
+Notes The Group The Group The Company The Company
+42
+2,614,349
+1,933,836
+1,413,409
+1,097,522
+42
+(2,071,504)
+(1,546,604)
+(1,036,399)
+(858,403)
+Taxes and surcharges
+43
+(226,664)
+(194,904)
+(175,883)
+(153,214)
+Selling expenses
+44
+(71,295)
+3,023
+2020
+765
+Add: Other income
+Add: Non-operating income
+Less: Non-operating expenses
+Profit before taxation
+Less: Taxation
+Net profit
+Classified by continuity of operations:
+1,091
+182,180
+1,423
+931
+1,302
+64,783
+Operating profit
+125,867
+53(a)
+2,983
+4,109
+2,192
+3,206
+53(b)
+(26,969)
+(12,823)
+(21,887)
+(7,526)
+158,194
+79,548
+52
+5,314
+(143)
+(13,110)
+(905)
+(6,761)
+48
+14,251
+9,889
+12,274
+6,976
+Investment income
+49
+35,389
+51,845
+26,044
+114,412
+Including: Income from investment in
+associates and joint ventures
+13,267
+3,533
+10,604
+Credit losses
+Asset impairment losses
+Gains on asset disposal
+6580
+50
+51
+(353)
+(27,611)
+(341)
+(23,520)
+558
+2021
+(All amounts in RMB millions unless otherwise stated)
+CONSOLIDATED AND COMPANY INCOME STATEMENTS
+FOR THE YEAR ENDED DECEMBER 31, 2021
+Advances to suppliers
+2,830
+3,598
+8,076
+3,975
+9
+Receivables financing
+8,412
+7,429
+52,325
+56,659
+10
+8
+42,787
+35,505
+145,950
+163,536
+7
+Cash at bank and on hand
+Current assets
+ASSETS
+The Company
+31, 2020
+December
+Accounts receivable
+14,598
+21,626
+6,273
+197,402
+486,767
+480,838
+Total current assets
+44,614
+44,442
+60,802
+58,668
+13
+Other current assets
+42,615
+Assets held for sale
+77,813
+95,828
+128,539
+143,848
+12
+Inventories
+14,738
+4,327
+26,834
+39,554
+11
+Other receivables
+8,861
+December
+31, 2021
+The Company
+December
+31, 2020
+The Group
+The Group
+Notes
+41
+1,263,815
+145,309
+1,409,124
+1,215,421
+1,171,141
+1,126,795
+151,464
+1,366,885
+1,171,141
+1,126,795
+TOTAL LIABILITIES AND
+SHAREHOLDERS' EQUITY
+2,502,533
+2,488,400
+1,843,950
+1,814,683
+Chairman
+Dai Houliang
+The accompanying notes form an integral part of these financial statements.
+Director and President
+Huang Yongzhang
+Chief Financial Officer
+Chai Shouping
+2021 ANNUAL REPORT
+119
+FINANCIAL STATEMENTS PetroChina
+PETROCHINA COMPANY LIMITED
+Non-controlling interests
+Total shareholders' equity
+Non-current assets
+holders of the Company
+619,102
+December
+31, 2021
+(All amounts in RMB millions unless otherwise stated)
+CONSOLIDATED AND COMPANY BALANCE SHEETS
+AS OF DECEMBER 31, 2021
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS PetroChina
+117
+2021 ANNUAL REPORT
+Signing CPA Li Dan
+(Engagement Partner)
+Signing CPA Zhao Juan
+31 March 2022
+Shanghai, the People's Republic of China
+PricewaterhouseCoopers Zhong Tian LLP
+From the matters communicated with those charged with governance, we determine those matters that were of most
+significance in the audit of the financial statements of the current period and are therefore the key audit matters. We
+describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter or
+when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because
+the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such
+communication.
+PwC ZT Shen Zi (2022) No. 10001
+(Page 6 of 6)
+普华永道
+AUDITOR'S REPORT (continued)
+pwc
+200,878
+455
+192,465
+Undistributed profits
+40
+766,955
+722,939
+654,956
+Equity attributable to equity
+2,708,430 2,209,071
+Distribution to
+11,293
+1,243,325
+Director and President
+Chairman
+Dai Houliang
+The accompanying notes form an integral part of these financial statements.
+145,309 1,409,124
+766,955 1,263,815
+(34,737) 211,970
+183,021 127,375 9,231
+Balance at December 31,
+2021
+230
+(12,380)
+(12,380)
+(72)
+302
+134
+168
+769
+769
+Acquisition of subsidiaries
+Disposal of subsidiaries
+Other
+1,059
+1,059
+(34)
+(19)
+Huang Yongzhang
+(15)
+Chief Financial Officer
+Chai Shouping
+123
+183,021 127,845
+equity
+profits
+sive income reserves
+holders'
+Share Capital Special comprehen- Surplus Undistributed
+capital surplus reserve
+share-
+Other
+Total
+(All amounts in RMB millions unless otherwise stated)
+CHANGES IN SHAREHOLDERS' EQUITY
+FOR THE YEAR ENDED DECEMBER 31, 2021
+COMPANY STATEMENT OF
+PETROCHINA COMPANY LIMITED
+Appropriation to surplus
+Profit distribution
+Utilisation
+Appropriation
+reserve
+Balance at January 1, 2020
+Changes in the year of 2020
+Total comprehensive income
+Special reserve-safety fund
+Items
+FINANCIAL STATEMENTS PetroChina
+2021 ANNUAL REPORT
+(15)
+Equity transaction with
+non-controlling interests
+Capital contribution from
+non-controlling interests
+Other equity movement
+151,464 1,366,885
+722,939 1,215,421
+Balance at January 1, 2021 183,021 127,222 10,810 (32,128) 203,557
+Non- share-
+controlling holders'
+interests equity
+profits Sub-total
+Surplus Undistributed
+capital surplus reserve sive income reserves
+Items
+Share Capital Special comprehen-
+Other
+Total
+Shareholders' equity attributable to the Company
+(All amounts in RMB millions unless otherwise stated)
+FOR THE YEAR ENDED DECEMBER 31, 2021 (CONTINUED)
+PETROCHINA COMPANY LIMITED
+CONSOLIDATED STATEMENT OF
+CHANGES IN SHAREHOLDERS' EQUITY
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+122
+Chai Shouping
+Chief Financial Officer
+Director and President
+Huang Yongzhang
+Chairman
+Dai Houliang
+Changes in the year of
+2021
+Total comprehensive
+income
+shareholders
+(39,866) (15,975) (55,841)
+(39,866)
+(8,413)
+8,413
+(181) (7,372)
+5,622
+10
+5,612
+(7,191)
+20,634 110,186
+6,513
+92,161 89,552
+(7,191)
+5,612
+Distribution to
+reserves
+Appropriation to surplus
+Profit distribution
+Utilisation
+Appropriation
+reserve
+Special reserve-safety fund
+(2,609)
+The accompanying notes form an integral part of these financial statements.
+979
+590,727
+2 BASIS OF PREPARATION
+The financial statements were approved by the Board of Directors on March 31, 2022.
+The Group is principally engaged in (i) the exploration, development, transportation and production and marketing
+of crude oil and natural gas; (ii) the refining of crude oil and petroleum products, production and marketing of primary
+petrochemical products, derivative petrochemical products and other chemical products; (iii) the marketing of refined
+products and non-oil products, and trading business; and (iv) the transportation of natural gas and the sale of natural
+gas. The principal subsidiaries of the Group are listed in Note 6(1).
+PetroChina Company Limited (the "Company") was established as a joint stock company with limited liability on
+November 5, 1999 by XII (China National Petroleum Corporation ("CNPC")) as the sole proprietor
+in accordance with the approval Guo Jing Mao Qi Gai [1999] No. 1024 "Reply on the approval of the establishment of
+PetroChina Company Limited" from the former State Economic and Trade Commission of the People's Republic of China
+("China" or "PRC"). CNPC restructured ("the Restructuring") and injected its core business and the related assets and
+liabilities into the Company. 中國石油天然氣集團公司 was renamed 中國石油天然氣集團有限公司 (“CNPC”before and
+after the change of name) on December 19, 2017. CNPC is a wholly state-owned company registered in China. The
+Company and its subsidiaries are collectively referred to as the "Group".
+1 COMPANY BACKGROUND
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+FINANCIAL STATEMENTS
+Chai Shouping
+Huang Yongzhang
+13,466
+1,598,846
+Director and President
+PETROCHINA COMPANY LIMITED
+124
+The accompanying notes form an integral part of these financial statements.
+1,171,141
+654,956
+250 200,878
+(39,866)
+163
+(8,413)
+(39,866)
+8,413
+(3,437)
+The financial statements of the Group are prepared in accordance with Accounting Standards for Business
+Enterprises issued by the Ministry of Finance (the "MOF") and other regulations issued thereafter (hereafter referred to as
+the "Accounting Standard for Business Enterprises”, “China Accounting Standards" or "CAS"). The financial statements
+have been prepared on the going concern basis.
+3,558
+These financial statements also comply with the disclosure requirements of the financial statements and notes of
+"Regulation on the Preparation of Information Disclosures by Companies Issuing Securities, No. 15: General Requirements
+for Financial Reports" as revised by the China Securities Regulatory Commission ("CSRC") in 2014.
+The consolidated and the Company's financial statements for the year ended December 31, 2021 truly and
+completely present the financial position of the Group and the Company as of December 31, 2021 and their financial
+performance and their cash flows for the year then ended in compliance with the Accounting Standards for Business
+Enterprises.
+PETROCHINA COMPANY LIMITED
+126
+Assets and liabilities of each balance sheet of the foreign operations are translated into RMB at the closing rates
+at the balance sheet date, while the equity items are translated into RMB at the exchange rates at the date of the
+transactions, except for the retained earnings and the translation differences in other comprehensive income. Income
+and expenses for each income statement of the foreign operations are translated into RMB at the approximate exchange
+rates at the date of the transactions. The currency translation differences resulted from the above-mentioned translations
+are recognised as other comprehensive income. The cash flows of overseas operations are translated into RMB at the
+approximate exchange rates at the date of the transactions. The effect of exchange rate changes on cash is presented
+separately in the cash flow statement.
+(b) Translation of financial statements represented in foreign currency
+Monetary items denominated in foreign currencies at the balance sheet date are translated into RMB at the
+exchange rates prevailing at the balance sheet date. Exchange differences arising from these translations are recognised
+in profit or loss except for those arising from foreign currency specific borrowings for the acquisition, construction of
+qualifying assets in connection with capitalisation of borrowing costs. Non-monetary items denominated in foreign
+currencies measured at historical cost are translated into RMB at the historical exchange rates prevailing at the date of
+the transactions at the balance sheet date. The effect of exchange rate changes on cash is presented separately in the
+cash flow statement.
+Foreign currency transactions are translated into RMB at the exchange rates prevailing at the date of the
+transactions.
+(a) Foreign currency transactions
+(5) Foreign Currency Translation
+Generally are measured at historical cost unless otherwise stated at fair value, net realisable value or present value.
+(4) Measurement Properties
+The recording currency of the Company and most of its subsidiaries is Renminbi ("RMB"). The Group's consolidated
+financial statements are presented in RMB.
+(3) Recording Currency
+The Company takes the period from the exploration or acquisition of the crude oil, natural gas and other assets for
+exploring, transporting and processing and etc. to their realisation in cash and cash equivalent as a normal operating
+cycle.
+(2) Operating Cycle
+The accounting period of the Group starts on January 1 and ends on December 31.
+(1) Accounting Period
+4 PRINCIPAL ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS PetroChina
+2021 ANNUAL REPORT 125
+3 STATEMENT OF COMPLIANCE WITH THE ACCOUNTING STANDARDS FOR BUSINESS
+ENTERPRISES
+83,928
+84,133
+(205)
+192,465
+455
+4,708
+127,044
+183,021
+Balance at December 31,
+2020
+(818)
+(28,078)
+(6,275)
+(28,078)
+(17)
+(801)
+Other
+Distribution to shareholders
+6,275
+reserves
+(3,811)
+2,006
+62,221
+62,745
+(524)
+2,006
+(3,811)
+1,095,275
+619,102
+1,126,795
+Balance at January 1, 2021
+Changes in the year of 2021
+183,021 127,044
+Dai Houliang
+Chairman
+4,829
+183,021 127,207
+Balance at December 31,
+2021
+163
+Other
+3,558
+(3,437)
+Distribution to shareholders
+reserves
+186,190
+Appropriation to surplus
+Utilisation
+Appropriation
+reserve
+Special reserve-safety fund
+Total comprehensive income
+1,126,795
+619,102
+192,465
+455
+4,708
+Profit distribution
+151,464 1,366,885
+Chief Financial Officer
+(32,128) 203,557
+Cash flows from financing activities
+(67,811)
+(187,307)
+(203,916)
+(153,627)
+(181,986)
+(213,032)
+Net cash flows used for investing activities
+(276,965)
+(301,324)
+Sub-total of cash outflows
+(19,932)
+(9,977)
+(20,238)
+(35,761)
+Cash paid to acquire investments
+(167,375)
+(193,939)
+(256,727)
+(265,563)
+assets
+properties, intangible assets and other long-term
+Cash received from capital contributions
+673
+613
+Including: Cash received from non-controlling
+distribution of dividends or profits to non-controlling
+interests
+Including: Subsidiaries' cash payments for
+(41,744)
+(60,933)
+(69,195) (59,042)
+Cash payments for interest expenses and distribution
+of dividends or profits
+(344,847)
+(201,472)
+(836,434) (1,017,662)
+Cash repayments of borrowings
+Cash paid to acquire fixed assets, oil and gas
+306,501
+306,501
+172,284
+989,492
+990,105
+810,765
+Sub-total of cash inflows
+810,092
+Cash received from borrowings
+613
+673
+interests' capital contributions to subsidiaries
+172,284
+Capital reduction of subsidiaries
+80,588
+119,496
+94,979
+(1,358,076)
+(2,366,961) (1,890,496)
+(47,658)
+(39,092)
+(55,532)
+(179,530)
+Cash paid relating to other operating activities
+Sub-total of cash outflows
+(190,333)
+(233,375)
+(269,761)
+(310,416)
+Payments of various taxes
+(109,365)
+(113,521)
+(150,474)
+(154,384)
+Cash paid to and on behalf of employees
+(704,419)
+(972,088)
+(1,722,631) (1,414,729)
+722,939 1,215,421
+(1,051,775)
+Net cash flows from operating activities
+58(a)
+341,469
+88,292
+Sub-total of cash inflows
+82,767
+32,057
+Net cash received from disposal of subsidiaries and
+other business units
+726
+2,798
+1,269
+3,780
+16,936
+21,246
+50,289
+41,802
+15,110
+Cash received from returns on investments
+Net cash received from disposal of fixed assets, oil
+and gas properties, intangible assets and other
+long-term assets
+5,689
+3,633
+37,345
+Cash received from disposal of investments
+Cash flows from investing activities
+191,550
+240,770
+318,575
+7,310
+(16,508)
+203,557
+(69)
+(13,038) (12,796)
+(6,275)
+6,275
+22,351
+7,721
+14,630
+19,002
+(4,372)
+5,952
+(7,585)
+from non-controlling
+Capital contribution
+with non-controlling
+interests
+Equity transaction
+Other equity movement
+shareholders
+211,970
+surplus reserves
+Appropriation to
+Profit distribution
+Utilisation
+Appropriation
+fund reserve
+5,952
+(7,585)
+343
+6,295
+(215) (7,800)
+(28,078) (28,078) (14,827) (42,905)
+(2)
+Cash payments relating to other financing activities
+Sub-total of cash outflows
+183,021 127,222 10,810
+Balance at December 31,
+2020
+(57,914)
+270
+(57,914)
+199
+166
+1,187
+1,186
+1
+825
+Special reserve-safety
+823
+(95)
+Other
+subsidiaries
+Disposal of
+1
+subsidiaries
+Acquisition of
+2
+interests
+(2)
+2
+Total comprehensive
+income
+71
+214,150 1,444,578
+58(c)
+Cash and cash equivalents at the end of the period
+4,636
+40,787
+86,409
+118,631
+36,151
+(8,832)
+32,222
+18,158
+Net Increase/(decrease) in cash and cash equivalents 58(b)
+Add: Cash and cash equivalents at the beginning of
+the period
+(4,967)
+(2,308)
+Effect of foreign exchange rate changes on cash and
+cash equivalents
+(87,588)
+(95,975)
+(7,498)
+(394,089)
+(918,736) (1,089,505)
+(107,971) (99,400)
+(14,264)
+(5)
+Changes in the year of
+2020
+Net cash flows used for financing activities
+136,789
+118,631
+(5,854)
+(268,259)
+40,787
+holders'
+equity
+Balance at January 1,
+2020
+Share Capital Special comprehen- Surplus Undistributed
+controlling
+capital surplus reserve sive income reserves
+profits Sub-total interests
+738,124 1,230,428
+Items
+Total
+share-
+Non-
+31,955
+Shareholders' equity attributable to the Company
+(All amounts in RMB millions unless otherwise stated)
+183,021 127,314 12,443 (27,756) 197,282
+Other
+PETROCHINA COMPANY LIMITED
+Chairman
+CONSOLIDATED STATEMENT OF
+CHANGES IN SHAREHOLDERS' EQUITY
+FOR THE YEAR ENDED DECEMBER 31, 2021
+The accompanying notes form an integral part of these financial statements.
+Director and President
+Dai Houliang
+Chief Financial Officer
+Chai Shouping
+2021 ANNUAL REPORT 121
+FINANCIAL STATEMENTS PetroChina
+Huang Yongzhang
+Investments in subsidiaries are accounted for at cost in the financial statements of the Company and are
+consolidated after being adjusted by the equity method accounting in consolidated financial statements.
+Long-term equity investments accounted for at cost are measured at the initial investment cost unless the
+investment is classified as held for sale. The cash dividends or profit distributions declared by the investees are
+recognised as investment income in the income statement.
+A listing of the Group's principal subsidiaries is set out in Note 6(1).
+2021 ANNUAL REPORT 133
+FINANCIAL STATEMENTS PetroChina
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+PETROCHINA COMPANY LIMITED
+Joint ventures are arrangements whereby the Group and other parties have joint control and rights to the net assets
+of the arrangements. Associates are those in which the Group has significant influence over the financial and operating
+policies.
+The term "joint control" refers to the contractually agreed sharing of control of an arrangement, which exists only
+when decisions about the relevant activities (activities with significant impact on the returns of the arrangement) require
+the unanimous consent of the parties sharing control.
+The term "significant influence" refers to the power to participate in the formulation of financial and operating policies
+of an enterprise, but not the power to control, or jointly control, the formulation of such policies with other parties.
+The investments in joint ventures and associates are accounted for using the equity method accounting. The excess
+of the initial cost of the investment over the share of the fair value of the investee's net identifiable assets is included in the
+initial cost of the investment. While the excess of the share of the fair value of the investee's net identifiable assets over
+the cost of the investment is instead recognised in profit or loss in the period in which the investment is acquired and the
+cost of the long-term equity investment is adjusted accordingly.
+Under the equity method accounting, the Group's share of its investees' post-acquisition profits or losses and other
+comprehensive income is recognised as investment income or losses and other comprehensive income respectively.
+When the Group's share of losses of an investee equals or exceeds the carrying amount of the long-term equity
+investment and other long-term interests which substantively form the net investment in the investee, the Group does not
+recognise further losses as provisions, unless it has obligations to bear extra losses which meet the criteria of recognition
+for liabilities according to the related standards for contingencies. Movements in the investee owner's equity other than
+profit or loss, other comprehensive income and profit distribution should be proportionately recognised in the Group's
+equity, provided that the share interest of the investee remained unchanged. The share of the investee's profit distribution
+or cash dividends declared is accounted for as a reduction of the carrying amount of the investment upon declaration.
+The profits or losses arising from the intra-Group transactions between the Group and its investees are eliminated to the
+extent of the Group's interests in the investees, on the basis of which the investment income or losses are recognised.
+The unrealised loss on the intra-Group transaction between the Group and its investees, of which nature is asset
+impairment, is recognised in full amount, and the relevant unrealised loss is not allowed to be eliminated. If the Group
+invests a business to investee as a long-term equity investment but not obtain control, the fair value of the invested
+business shall be used as the initial investment cost of the long-term equity investment. The difference between the
+carrying amount of the initial cost of the investment and the invested business is recognised in profit or loss.
+(c) Impairment of long-term equity investments
+For investments in subsidiaries, joint ventures and associates, if the recoverable amount is lower than its carrying
+amount, the carrying amount shall be written down to the recoverable amount (Note 4(16)). After an impairment loss has
+been recognised, it shall not be reversed in future accounting periods for the part whose value has been recovered.
+134
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+(b) Joint ventures and associates
+(a) Subsidiaries
+132
+Long-term equity investments acquired through business combinations: For a long-term equity investment acquired
+through a business combination under common control, the proportionate share of the carrying value of shareholders'
+equity of the combined entity in the consolidated financial statements of the ultimate controlling party shall be treated
+as initial cost of the investment on the acquisition date. For a long-term equity investment obtained through a business
+combination not involving entities under common control, the initial cost comprises the aggregate of the fair value of
+assets transferred, liabilities incurred or assumed, and equity securities issued by the Company, in exchange for control
+of the acquiree.
+(v) Presentation of allowance for ECL
+ECLS are remeasured at each balance sheet date to reflect changes in the financial instrument's credit risk since
+initial recognition. Any change in the ECL amount is recognised as an impairment gain or loss in profit or loss. The Group
+recognises an impairment gain or loss for all financial instruments with a corresponding adjustment to their carrying
+amount through a loss allowance account, except for debt investments that are measured at FVOCI, for which the loss
+allowance is recognised in other comprehensive income.
+(d) Joint Operations
+(vi) Write-off
+The gross carrying amount of a financial asset is written off (either partially or in full) to the extent that there is no
+realistic prospect of recovery. A write-off constitutes a derecognition event. This is generally the case when the Group
+determines that the debtor does not have assets or sources of income that could generate sufficient cash flows to
+repay the amounts subject to the write-off. However, according to the Group's procedures for recovery of amounts due,
+financial assets that are written off could still be subject to enforcement activities.
+Subsequent recoveries of an asset that was previously written off are recognised as a reversal of impairment in profit
+or loss in the period in which the recovery occurs.
+(g) Determination of financial instruments' fair value
+Regarding financial instruments, for which there is an active market, fair value is the price that would be received to
+sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.
+If there is no active market for a financial instrument, valuation techniques shall be adopted to determine the fair value.
+When measuring fair value, the Group takes into account the characteristics of the particular asset or liability (including
+the condition and location of the asset and restrictions, if any, on the sale or use of the asset) that market participants
+would consider when pricing the asset or liability at the measurement date, and uses valuation techniques that are
+appropriate in the circumstances and for which sufficient data and other information are available to measure fair value.
+Valuation techniques mainly include the market approach, the income approach and the cost approach.
+Long-term equity investments acquired through other than business combinations: For an acquisition settled in
+cash, the initial cost of investment shall be the actual cash consideration paid. For an acquisition settled by the issuance
+of equity securities, the initial cost of investment shall be the fair value of equity securities issued.
+(8) Inventories
+Inventories are initially measured at cost. Cost of inventories comprises all costs of purchase, costs of conversion
+and other expenditure incurred in bringing the inventories to their present location and condition. In addition to the
+purchase cost of raw materials, work in progress and finished goods include direct labour costs and an appropriate
+allocation of production overheads.
+Cost of inventories is determined primarily using the weighted average method. The cost of finished goods and work
+in progress comprises cost of crude oil, other raw materials, direct labour and production overheads allocated based on
+normal operating capacity. Spare parts and consumables include low cost consumables and packaging materials. Low
+cost consumables are amortised with graded amortisation method and packaging materials are expensed off in full.
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+Provision for decline in the value of inventories is measured as the excess of the carrying value of the inventories
+over their net realisable value. Net realisable value is the estimated selling price in the ordinary course of business less the
+estimated costs of completion and the estimated costs necessary to make the sale and relevant taxes. The net realisable
+value of materials held for use in the production is measured based on the net realisable value of the finished goods
+in which they will be incorporated. The net realisable value of the inventory held to satisfy sales or service contracts is
+measured based on the contract price, to the extent of the quantities specified in sales contracts, and the excess portion
+of inventories is measured based on general selling prices.
+The Group adopts perpetual inventory system.
+(9) Long-term Equity Investments and Joint Operations
+Long-term equity investments comprise the Company's equity investments in subsidiaries, and the Group's equity
+investments in joint ventures and associates.
+Inventories include crude oil and other raw materials, work in progress, finished goods and spare parts and
+consumables, and are measured at the lower of cost and net realisable value.
+A joint operation is an arrangement whereby the Group and other joint operators have joint control and the Group
+has rights to the assets and obligation for the liabilities, relating to the arrangement.
+5 to 12 years
+⚫its solely-held assets, and its share of any assets held jointly;
+3.2 to 24.3
+3 to 5
+4 to 30 years
+2.4 to 11.9
+5
+8 to 40 years
+Annual depreciation
+rate %
+Estimated residual
+value ratio %
+Estimated useful lives
+4 to 14 years
+Other
+Equipment and Machinery
+Buildings
+The estimated useful lives, estimated residual value ratios and annual depreciation rates of the fixed assets are as
+follows:
+Fixed assets are depreciated using the straight-line method based on the balance of their costs less estimated
+residual values over their estimated useful lives. For those fixed assets being provided for impairment loss, the related
+depreciation charge is determined based on the net value lessening the impairment recognised over their remaining
+useful lives.
+Subsequent expenditures for fixed assets are included in the cost of fixed assets only when it is probable that in
+future economic benefits associated with the items will flow to the Group and the cost of the items can be measured
+reliably. The carrying amount of the replaced part is derecognised. All other subsequent expenditures are charged to
+profit or loss during the financial period in which they are incurred.
+Fixed assets comprise buildings, equipment and machinery, motor vehicles and other. Fixed assets purchased
+or constructed are initially recorded at cost. The fixed assets injected by the state-owned shareholder during the
+Restructuring were initially recorded at the valuated amount approved by the relevant authorities managing state-owned
+assets.
+(10) Fixed Assets
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+⚫ its solely-incurred expenses, and its share of any expenses incurred jointly.
+Motor Vehicles
+The Group recognises items related to its interest in a joint operation as follows:
+LO
+6.8 to 23.8
+⚫ its solely-assumed liabilities, and its share of any liabilities incurred jointly;
+136 PETROCHINA COMPANY LIMITED
+Construction in progress is recognised at actual cost. The actual cost comprises construction costs, other
+necessary costs incurred and the borrowing costs eligible for capitalisation to prepare the asset for its intended use.
+Construction in progress is transferred to fixed assets when the assets are ready for their intended use, and depreciation
+begins from the following month.
+(12) Construction in Progress
+The carrying amount of oil and gas properties is reduced to the recoverable amount when their recoverable amount
+is lower than their carrying amount. The recoverable amount is the higher of an asset's fair value less costs to sell and the
+present value of the estimated future cash flow expected to be derived from the asset (or asset group, the same below)
+(Note 4(16)).
+The oil and gas properties are amortised at the field level based on the unit of production method except for the
+mineral interests in unproved properties which are not subjected to depletion. Unit of production rates are based on oil
+and gas reserves estimated to be recoverable from existing facilities based on the current terms of production licenses.
+The Ministry of Natural Resources in China issues production licenses to applicants on the basis of the reserve
+reports approved by relevant authorities.
+The costs of obtaining the mineral interests in properties are capitalised when they are incurred and are initially
+recognised at acquisition costs. Exploration license fee, production license fee, rent and other costs for retaining the
+mineral interests in properties, subsequent to the acquisition of the mineral interests in properties, are charged to profit or
+loss.
+Oil and gas properties include the mineral interests in properties, wells and related facilities arising from oil and gas
+exploration and production activities.
+5
+(11) Oil and Gas Properties
+An asset's carrying amount is written down immediately to its recoverable amount if the asset's carrying amount is
+greater than its recoverable amount (Note 4(16)).
+The estimated useful lives, estimated residual values and depreciation method of the fixed assets are reviewed, and
+adjusted if appropriate, at year end.
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS PetroChina
+2021 ANNUAL REPORT 135
+7.9 to 19.0
+5
+LO
+The carrying amounts of fixed assets are derecognised when the fixed assets are disposed or no future economic
+benefits are expected from their use or disposal. When fixed assets are sold, transferred, disposed or damaged, gains
+or losses on disposal are determined by comparing the proceeds with the carrying amounts of the assets, adjusted by
+related taxes and expenses, and are recorded in profit or loss in the disposal period.
+PETROCHINA COMPANY LIMITED
+• Financial liabilities at amortised cost:
+131
+On initial recognition of an equity investment that is not held for trading, the Group may irrevocably elect to
+designate it as a financial assets at FVOCI. This election is made on an investment-by-investment basis, and from the
+perspective of the issuer, related investment is in line with the definition of equity instruments.
+All financial assets not classified as measured at amortised cost or FVOCI as described above are measured at
+FVTPL.
+The business model in which a financial asset is managed refers to how the Group manages its financial assets
+in order to generate cash flows. That is, the Group's business model determines whether cash flows will result from
+collecting contractual cash flows, selling financial assets, or both. The Group determines the business model for
+managing financial assets according to the facts and based on the specific business objectives for the managing the
+financial assets determined by the Group's key management personnel.
+In assessing whether the contractual cash flows are solely payments of principal and interest on the principal
+amount outstanding, the Group considers the contractual cash flow characteristics of the instrument. For the purposes
+of this assessment, “principal" is defined as the fair value of the financial assets at initial recognition. “Interest” is defined
+as consideration for the time value of money and for the credit risk associated with the principal amount outstanding
+during a particular period of time and for other basic lending risks and costs, as well as a profit margin. The Group also
+assesses whether the financial asset contains a contractual term that could change the timing or amount of contractual
+cash flows such that it would not meet this condition.
+(ii) Subsequent measurement of the financial assets
+• Financial assets at FVTPL:
+These financial assets are subsequently measured at fair value. Gains and losses, including any interest or dividend
+income, are recognised in profit or loss, unless the financial assets are a part of hedging relationship.
+• Financial assets measured at amortised cost:
+These assets are subsequently measured at amortised cost using the effective interest method. Gains or losses on
+financial assets that are measured at amortised cost and are not a part of any hedging relationship shall be recognised
+in profit or loss when the financial asset is derecognised, reclassified, through the amortisation process or in order to
+recognise impairment gains or losses.
+• its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on
+the principal amount outstanding.
+128 PETROCHINA COMPANY LIMITED
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+• Debt investments at FVOCI:
+These assets are subsequently measured at fair value. Interest income calculated using the effective interest
+method, impairment and foreign exchange gains and losses are recognised in profit or loss. Other gains and losses are
+recognised in other comprehensive income. On derecognition, gains and losses accumulated in other comprehensive
+income are reclassified to profit or loss.
+Equity investments at FVOCI:
+These assets are subsequently measured at fair value. Dividends are recognised in profit or loss. Other gains
+and losses are recognised in other comprehensive income. On derecognition, gains and losses accumulated in other
+comprehensive income are reclassified to retained earnings.
+(c) Classification and subsequent measurement of financial liabilities
+Financial liabilities are classified as measured at FVTPL or amortised cost.
+• Financial liabilities at FVTPL:
+A financial liability is classified as at FVTPL if it is classified as held-for-trading (including derivative financial liability) or
+it is designated as such on initial recognition.
+FINANCIAL STATEMENTS
+Financial liabilities at FVTPL are subsequently measured at fair value and gains and losses, including any interest
+expense, are recognised in profit or loss, unless the financial liabilities are part of a hedging relationship.
+⚫it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling
+financial assets;
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+(6) Cash and Cash Equivalents
+Cash and cash equivalents refer to all cash on hand and deposit held at call with banks, short-term highly liquid
+investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of
+changes in value.
+(7) Financial Instrument
+Financial instruments include cash at bank and on hand, equity securities other than those classified as long-term
+equity investments, accounts receivables, accounts payables, borrowings, debentures payable and share capital, etc.
+(a) Recognition and initial measurement of financial assets and financial liabilities
+A financial asset or financial liability is recognised in the balance sheet when the Group becomes a party to the
+contractual provisions of a financial instrument.
+A financial asset (unless it is an accounts receivable without a significant financing component) and financial liability
+is measured initially at fair value. For financial assets and financial liabilities at fair value through profit or loss, any related
+directly attributable transaction costs are charged to profit or loss; for other categories of financial assets and financial
+liabilities, any related directly attributable transaction costs are included in their initial costs. A trade receivable, without
+significant financing component or practical expedient applied for one year or less contracts is initially measured at the
+transaction price according to Note 4(22).
+A financial asset is measured at FVOCI if it meets both of the following conditions and is not designated as at
+FVTPL:
+(b) Classification and subsequent measurement of financial assets
+The classification of financial assets is generally based on the business model in which a financial asset is managed
+and its contractual cash flow characteristics. On initial recognition, a financial asset is classified as measured at amortised
+cost, at fair value through other comprehensive income ("FVOCI"), or at fair value through profit or loss ("FVTPL”).
+Financial assets are not reclassified subsequent to their initial recognition unless the Group changes its business
+model for managing financial assets in which case all affected financial assets are reclassified on the first day of the first
+reporting period following the change in the business model.
+A financial asset is measured at amortised cost if it meets both of the following conditions and is not designated as
+at FVTPL:
+⚫it is held within a business model whose objective is to collect contractual cash flows;
+⚫ its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on
+the principal amount outstanding.
+2021 ANNUAL REPORT
+127
+FINANCIAL STATEMENTS PetroChina
+PETROCHINA COMPANY LIMITED
+(i) Classification of the financial assets held by the Group
+FINANCIAL STATEMENTS PetroChina
+⚫ its share of the revenue from the sale of the output by the joint operation;
+(d) Offsetting
+12-month ECLs are the portion of ECLs that result from default events that are possible within the 12 months after
+the balance sheet date (or a shorter period if the expected life of the instrument is less than 12 months).
+130
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+Loss allowances for trade receivables and contract assets are always measured at an amount equal to lifetime
+ECL. ECLS on these financial assets are estimated using a provision matrix based on the Group's historical credit loss
+experience, adjusted for factors that are specific to the debtors and an assessment of both the current and forecast
+general economic conditions at the balance sheet date.
+Except for trade receivables and contract assets, the Group measures loss allowance at an amount equal to
+12-month ECL for the following financial instruments that have low credit risk for which credit risk has not increased
+significantly since initial recognition, and at an amount equal to lifetime ECL for trade receivables and contract assets.
+When determining whether the credit risk of a financial asset has increased significantly since initial recognition and
+when estimating ECL, the Group considers reasonable and supportable information that is relevant and available without
+undue cost or effort, including forward-looking information.
+(ii) Financial instruments that have low credit risk
+Lifetime ECLs are the ECLs that result from all possible default events over the expected life of a financial instrument.
+The credit risk on a financial instrument is considered low if the financial instrument has a low risk of default, the
+borrower has a strong capacity to meet its contractual cash flow obligations in the near term and adverse changes in
+economic and business conditions in the longer term may, but will not necessarily, reduce the ability of the borrower to
+fulfil its contractual cash flow obligations.
+In assessing whether the credit risk of a financial instrument has increased significantly since initial recognition, the
+Group compares the risk of default occurring on the financial instrument assessed at the balance sheet date with that
+assessed at the date of initial recognition.
+(iv) Credit-impaired financial assets
+At each balance sheet date, the Group assesses whether financial assets carried at amortised cost and debt
+investments at FVOCI are credit-impaired. A financial asset is 'credit-impaired' when one or more events that have a
+detrimental impact on the estimated future cash flows of the financial asset have occurred. Evidence that a financial asset
+is credit-impaired includes the following observable data:
+• significant financial difficulty of the borrower or issuer;
+• a breach of contract, such as a default or delinquency in interest or principal payments;
+⚫ for economic or contractual reasons relating to the borrower's financial difficulty, the Group having granted to the
+borrower a concession that would not otherwise consider;
+⚫it is probable that the borrower will enter bankruptcy or other financial reorganisation; or
+⚫ the disappearance of an active market for that financial asset because of financial difficulties.
+2021 ANNUAL REPORT
+(iii) Significant increases in credit risk
+Other financial liabilities are subsequently measured at amortised cost using the effective interest method.
+The maximum period considered when estimating ECLs is the maximum contractual period (including extension
+options) over which the group is exposed to credit risk.
+(i) Measurement of ECLS
+Financial assets and financial liabilities are generally presented separately in the balance sheet, and are not offset.
+However, a financial asset and a financial liability are offset and the net amount is presented in the balance sheet when
+both of the following conditions are satisfied:
+⚫the Group currently has a legally enforceable right to set off the recognised amounts;
+⚫the Group intends either to settle on a net basis, or to realise the financial asset and settle the financial liability
+simultaneously.
+2021 ANNUAL REPORT
+129
+FINANCIAL STATEMENTS PetroChina
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+(e) Derecognition of financial assets and financial liabilities
+ECLS are a probability-weighted estimate of credit losses. Credit losses are measured as the present value of all
+cash shortfalls (i.e. the difference between the cash flows due to the entity in accordance with the contract and the cash
+flows that the Group expects to receive).
+Financial asset is derecognised when one of the following conditions is met:
+⚫ the financial asset has been transferred and the Group transfers substantially all of the risks and rewards of
+ownership of the financial asset; or
+the financial asset has been transferred, although the Group neither transfers nor retains substantially all of the
+risks and rewards of ownership of the financial asset, it does not retain control over the transferred asset.
+Where a transfer of a financial asset in its entirety meets the criteria for derecognition, the difference between the
+two amounts below is recognised in profit or loss:
+⚫the carrying amount of the financial asset transferred measured at the date of derecognition;
+the sum of the consideration received from the transfer and, when the transferred financial asset is a debt
+investment at FVOCI, any cumulative gain or loss that has been recognised directly in other comprehensive
+income for the part derecognised.
+The Group derecognises a financial liability (or part of it) only when its contractual obligation (or part of it) is
+extinguished.
+(f) Impairment
+The Group recognises loss allowances for expected credit loss ("ECL") on financial assets measured at amortised
+cost, contract assets and debt investments measured at FVOCI.
+Financial assets measured at fair value, including debt investments or equity investments at FVTPL, equity
+investments designated at FVOCI and derivative financial assets, are not subject to the ECL assessment.
+⚫the Group's contractual rights to the cash flows from the financial asset expire;
+⚫ its revenue from the sale of its share of the output arising from the joint operation;
+(16) Impairment of Non-current Assets
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+For performance obligation satisfied over time, the Group recognises revenue over time by measuring the progress
+towards complete satisfaction of that performance obligation. When the outcome of that performance obligation cannot
+be measured reasonably, but the Group expects to recover the costs incurred in satisfying the performance obligation,
+the Group recognises revenue only to the extent of the costs incurred until such time that it can reasonably measure the
+outcome of the performance obligation.
+For performance obligation satisfied at a point in time, the Group recognises revenue at the point in time at which
+the customer obtains control of relevant goods or services. To determine whether a customer has obtained control of
+goods or services, the Group considers the following indicators:
+• The Group has a present right to payment for the product or service;
+• The Group has transferred physical possession of the goods to the customer;
+• The Group has transferred the legal title of the goods or the significant risks and rewards of ownership of the
+goods to the customer; and
+• The customer has accepted the goods or services.
+• The Group's performance does not create an asset with an alternative use to it and the Group has an enforceable
+right to payment for performance completed to date.
+2021 ANNUAL REPORT 143
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+The Group determines whether it is a principal or an agent, depending on whether it obtains control of the specified
+good or service before that good or service is transferred to a customer. The Group is a principal if it controls the
+specified good or service before that good or service is transferred to a customer, and recognises revenue in the gross
+amount of consideration to which it has received (or receivable). Otherwise, the Group is an agent, and recognises
+revenue in the amount of any fee or commission to which it expects to be entitled. The fee or commission is the net
+amount of consideration that the Group retains after paying the other party the consideration, or is the established
+amount or proportion.
+A contract asset is the Group's right to consideration in exchange for goods or services that it has transferred
+to a customer when that right is conditional on something other than the passage of time. The Group recognises
+loss allowances for expected credit loss on contract assets (Note 4(7)(f)). Accounts receivable is the Group's right to
+consideration that is unconditional (only the passage of time is required). A contract liability is the Group's obligation to
+transfer goods or services to a customer for which the Group has received consideration (or an amount of consideration
+is due) from the customer.
+The following is the description of accounting policies regarding revenue from the Group's principal activities:
+(a) Sales of goods
+FINANCIAL STATEMENTS PetroChina
+The Group shall recognise revenue when (or as) the customer obtains control of relevant product. Obtaining control
+of relevant product means that a customer can dominate the use of the product and obtain almost all the economic
+benefits from it.
+• The customer can control the asset created or enhanced during the Group's performance;
+The Group satisfies a performance obligation over time if one of the following criteria is met; or otherwise, a
+performance obligation is satisfied at a point in time:
+Deferred tax assets of the Group are recognised for deductible temporary differences and deductible losses and tax
+credits to the extent that it is probable that future taxable profit will be available against which the deductible temporary
+differences, deductible losses and tax credits can be utilised.
+Deferred tax liabilities are recognised for taxable temporary differences arising from investments in subsidiaries,
+associates and joint ventures, except where the timing of the reversal of the temporary difference is controlled by the
+Group and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax assets are
+recognised for deductible temporary differences arising from investments in subsidiaries, associates and joint ventures,
+to the extent that, and only to the extent that, it is probable that the temporary differences will reverse in the foreseeable
+future and taxable profit will be available against which the temporary differences can be utilised.
+• Deferred tax assets and liabilities are related to the income tax of the same entity within the Group levied by the
+same authority;
+• This entity is legally allowed to settle its current tax assets and liabilities on a net basis.
+(22) Revenue Recognition
+Revenue is the gross inflow of economic benefits arising in the course of the Group's ordinary activities when the
+inflows result in increase in shareholders' equity, other than increase relating to contributions from shareholders.
+• The customer simultaneously receives and consumes the benefits provided by the Group's performance as the
+Group performs;
+Revenue is recognised when the Group satisfies the performance obligation in the contract by transferring the
+control over relevant goods or services to the customers.
+For the contract which the Group grants a customer the option to acquire additional goods or services (such as
+loyalty points), the Group assesses whether the option provides a material right to the customer. If the option provides a
+material right, the Group recognises the option as a performance obligation, and recognises revenue when those future
+goods or services are transferred or when the option expires. If the stand-alone selling price for a customer's option to
+acquire additional goods or services is not directly observable, the Group estimates it, taking into account all relevant
+information, including the difference in the discount that the customer would receive when exercising the option or
+without exercising the option, and the likelihood that the option will be exercised.
+142
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+The transaction price is the amount of consideration to which the Group expects to be entitled in exchange for
+transferring promised goods or services to a customer, excluding amounts collected on behalf of third parties. The
+Group recognises the transaction price only to the extent that it is highly probable that a significant reversal in the amount
+of cumulative revenue recognised will not occur when the uncertainty associated with the variable consideration is
+subsequently resolved. To determine the transaction price for contracts in which a customer promises consideration in
+a form other than cash, the Group measures the non-cash consideration at fair value. If the Group cannot reasonably
+estimate the fair value of the non-cash consideration, the Group measures the consideration indirectly by reference to
+the stand-alone selling price of the goods or services promised to the customer in exchange for the consideration. The
+consideration which the Group expects to refund to the customer is recognised as refund liabilities and excluded from
+transaction price. Where the contract contains a significant financing component, the Group recognises the transaction
+price at an amount that reflects the price that a customer would have paid for the promised goods or services if the
+customer had paid cash for those goods or services when (or as) they transfer to the customer. The difference between
+the amount of promised consideration and the cash selling price is amortised using an effective interest method over
+the contract term. The Group does not adjust the consideration for any effects of a significant financing component if
+it expects, at contract inception, that the period between when the Group transfers a promised good or service to a
+customer and when the customer pays for that good or service will be one year or less.
+Where a contract has two or more performance obligations, the Group determines the stand-alone selling price at
+contract inception of the distinct good or service underlying each performance obligation in the contract and allocates
+the transaction price in proportion to those stand-alone selling prices. The Group recognises as revenue the amount of
+the transaction price that is allocated to each performance obligation. The stand-alone selling price is the price at which
+the Group would sell a promised good or service separately to a customer. If a stand-alone selling price is not directly
+observable, the Group considers all information that is reasonably available to the entity, maximises the use of observable
+inputs to estimate the stand-alone selling price.
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+(b) Rendering of services
+(c) Loyalty points
+The Group recognises an impairment loss in profit or loss to the extent that the carrying amount of an asset related
+to contract costs exceeds:
+Remaining amount of consideration that the Group expects to receive in exchange for the goods or services to
+which the asset relates; less
+• The costs that relate directly to providing those goods or services that have not yet been recognised as expenses.
+2021 ANNUAL REPORT
+145
+FINANCIAL STATEMENTS PetroChina
+Assets recognised for the incremental costs of obtaining a contract and assets recognised for the costs to fulfil a
+contract (the "assets related to contract costs") are amortised on a systematic basis that is consistent with the transfer
+to the customer of the goods or services to which the assets relate and recognised in profit or loss for the current period.
+The Group recognises the incremental costs of obtaining a contract as an expense when incurred if the amortisation
+period of the asset that the entity otherwise would have recognised is one year or less.
+PETROCHINA COMPANY LIMITED
+(24) Leases
+A contract is lease if the lessor conveys the right to control the use of an identified asset to lessee for a period of
+time in exchange for consideration.
+At inception of a contract, the Group assesses whether a contract is, or contains, a lease. A contract is, or contains,
+a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for
+consideration.
+To assess whether a contract conveys the right to control the use of an identified asset, the Group assesses
+whether:
+• The contract involves the use of an identified asset. An identified asset may be specified explicitly or implicitly
+specified in a contract and should be physically distinct, or capacity portion or other portion of an asset that is not
+physically distinct but it represents substantially all of the capacity of the asset and thereby provides the customer
+with the right to obtain substantially all of the economic benefits from the use of the asset. If the supplier has a
+substantive substitution right throughout the period of use, then the asset is not identified;
+• The lessee has the right to obtain substantially all of the economic benefits from use of the asset throughout the
+period of use;
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+The Group recognises its revenue from rendering of services on performance progress. Customers simultaneously
+receive the service as the Group performs its obligation over time and consume the benefits arising from the Group's
+performance. Otherwise, a performance obligation is satisfied at a point in time, the Group shall recognise revenue when (or
+as) the customer obtains control of revenue service.
+• The costs are expected to be recovered.
+• The costs relate directly to an existing contract or to a specifically identifiable anticipated contract, including direct
+labour, direct materials, allocations of overheads (or similar costs), costs that are explicitly chargeable to the
+customer and other costs that are incurred only because the Group entered into the contract;
+Under its customer loyalty programme, the Group allocates a portion of the transaction price received to loyalty
+points that are redeemable against any future purchases of the Group's goods or services. This allocation is based on
+the relative stand-alone selling prices. The amount allocated to the loyalty programme is deferred, and is recognised as
+revenue when loyalty points are redeemed or expire.
+144 PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+• The lessee has the right to direct the use of the asset.
+For a contract that contains more separate lease components, the lessee and the lessor separate lease
+components and account for each lease component as a lease separately. For a contract that contains lease and non-
+lease components, the lessee and the lessor separate lease components from non-lease components. For a contract
+that contains lease and non-lease components, the lessee allocates the consideration in the contract to each lease
+component on the basis of the relative stand-alone price of the lease component and the aggregate stand-alone price
+of the non-lease components. The lessor allocates the consideration in the contract in accordance with the accounting
+policy in Note 4(22).
+• The costs generate or enhance resources of the Group that will be used in satisfying (or in continuing to satisfy)
+performance obligations in the future; and
+(a) The Group as a lessee
+The right-of-use asset is depreciated using the straight-line method. If the lessee is reasonably certain to exercise
+a purchase option by the end of the lease term, the right-of-use asset is depreciated over the remaining useful lives of
+the underlying asset. Otherwise, the right-of-use asset is depreciated from the commencement date to the earlier of the
+end of the useful life of the right-of-use asset or the end of the lease term. Impairment losses of right-of-use assets are
+accounted for in accordance with the accounting policy described in Note 4(16).
+146 PETROCHINA COMPANY LIMITED
+(23) Contract Costs
+Contract costs are either the incremental costs of obtaining a contract with a customer or the costs to fulfil a
+contract with a customer.
+Incremental costs of obtaining a contract are those costs that the Group incurs to obtain a contract with a customer
+that it would not have incurred if the contract had not been obtained. The Group recognises as an asset the incremental
+costs of obtaining a contract with a customer if it expects to recover those costs, unless the expected amortisation
+period is one year or less from the date of initial recognition of the asset, in which case the costs are expensed when
+incurred. Other costs of obtaining a contract are expensed when incurred.
+If the costs to fulfil a contract with a customer are not within the scope of inventories or other accounting standards,
+the Group recognises an asset from the costs incurred to fulfil a contract only if those costs meet all of the following
+criteria:
+The Group recognises a right-of-use asset and a lease liability at the lease commencement date. The right-of-use
+asset is initially measured at cost, which comprises the initial amount of the lease liability, any lease payments made at or
+before the commencement date (less any lease incentives received), any initial direct costs incurred and an estimate of
+costs to dismantle and remove the underlying asset or to restore the site on which it is located or restore the underlying
+asset to the condition required by the terms and conditions of the lease.
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+141
+It is able to prove that the intangible asset is to generate economic benefits;
+• With the support of sufficient technologies, financial resources and other resources, it is able to finish the
+development of the intangible asset, and it is able to use or sell the intangible asset; and
+• The costs attributable to the development of the intangible asset can be reliably measured.
+Costs incurred on development projects not satisfying the above conditions shall be recorded in profit or loss of
+the current period. Costs incurred on development recorded in profit or loss in previous accounting periods shall not be
+re-recognised as asset in future accounting periods. Costs incurred on development already capitalised shall be listed
+as development expenditure in the balance sheet, which shall be transferred to intangible asset from the date when the
+expected purposes of use are realised.
+(15) Long-term Prepaid Expenses
+Long-term prepaid expenses are the expenses that should be borne by current and subsequent periods and should
+be amortised over more than one year. Long-term prepaid expenses are amortised using the straight-line method over
+the expected beneficial periods and are presented at cost less accumulated amortisation.
+It is intended by management to finish and use or sell the intangible asset;
+Fixed assets, oil and gas properties except for mineral interests in unproved properties, construction in progress,
+intangible assets with finite useful life, long-term equity investments, long-term prepaid expenses and right-of-use
+assets are tested for impairment if there is any indication that an asset may be impaired at the balance sheet date. An
+impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount if the
+impairment test indicates that the recoverable amount is less than its carrying amount. The recoverable amount is the
+higher of an asset's fair value less costs to sell and the present value of the estimated future cash flow expected to be
+derived from the asset. Impairment should be assessed and recognised for each individual asset. If it is not possible to
+estimate the recoverable amount of an individual asset, the recoverable amount of the group of assets to which the asset
+belongs is determined. A group of assets is the smallest group of assets that is able to generate independent cash flow.
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+The goodwill, presented separately in financial statements, is allocated to each asset group or set of asset groups,
+which is expected to benefit from the synergies of the combination for the purpose of impairment testing, and should
+be subject to impairment assessment at least on an annual basis regardless whether there exists any indicators of
+impairment. Where the impairment assessment indicates that, for the cash-generating unit (that includes the allocated
+goodwill), the recoverable amount is lower than the carrying value, then an impairment loss will be recorded.
+The mineral interests in unproved properties are tested annually for impairment. If the cost incurred to obtain a single
+property is significant, the impairment test is performed and the impairment loss is determined on the basis of the single
+property. If the cost incurred to obtain a single property is not significant and the geological structure features or reserve
+layer conditions are identical or similar to those of other adjacent properties, impairment tests are performed on the basis
+of a group of properties that consist of several adjacent mining areas with identical or similar geological structure features
+or reserve layer conditions.
+Once an impairment loss of these assets is recognised, it is not allowed to be reversed even if the value can be
+recovered in subsequent period.
+138
+(17) Borrowing Costs
+• In respect of the technology, it is feasible to finish the intangible asset for use or sale;
+(14) Research and Development
+Oil and gas exploration costs include drilling exploration costs and the non-drilling exploration costs, the successful
+efforts method is used for the capitalisation of the drilling exploration costs. Drilling exploration costs included in the oil
+and gas exploration costs are capitalised as wells and related facilities when the wells are completed and economically
+proved reserves are found. Drilling exploration costs related to the wells without economically proved reserves less
+the net residual value are recorded in profit or loss. The related drilling exploration costs for the sections of wells with
+economically proved reserves are capitalised as wells and related facilities, and the costs of other sections are recorded
+in profit or loss. Drilling exploration costs are temporarily capitalised pending the determination of whether economically
+proved reserves can be found within one year of the completion of the wells. For wells that are still pending determination
+of whether economically proved reserves can be found after one year of completion, the related drilling exploration
+costs remain temporarily capitalised only if sufficient reserves are found in those wells and further exploration activities
+are required to determine whether they are economically proved reserves or not, and further exploration activities are
+under way or firmly planned and are about to be implemented. Otherwise the related costs are recorded in profit or loss.
+If proved reserves are discovered in a well, for which the drilling exploration costs have been expensed previously, no
+adjustment should be made to the drilling exploration costs that were expensed, while the subsequent drilling exploration
+costs and costs for completion of the well are capitalised. The non-drilling exploration costs are recorded in profit or loss
+when incurred. Oil and gas development costs are capitalised as the respective costs of wells and related facilities for
+oil and gas development based on their intended use. The economically proved reserves are the estimated quantities
+of crude oil and natural gas, which, by analysis of geoscience and engineering data, can be estimated with reasonable
+certainty to be economically producible from a given date forward, from known reservoirs, and under existing economic
+conditions, operating methods, and government supervision regulation before the time at which contracts providing the
+right to operate expire, unless evidence indicates that renewal is reasonably certain, regardless of whether the estimate is
+a deterministic estimate or probabilistic estimate.
+(13) Intangible Assets and Goodwill
+Intangible assets include land use rights and patents, etc., and are initially recorded at cost. The intangible assets
+injected by the state-owned shareholder during the Restructuring were initially recorded at the valued amount approved
+by the relevant authorities managing the state-owned assets.
+Land use rights are amortised using the straight-line method over 30 to 50 years. If it is impracticable to allocate
+the amount paid for the purchase of land use rights and buildings between the land use rights and the buildings on a
+reasonable basis, the entire amount is accounted for as fixed assets.
+The franchise is initially recorded at actual cost, and amortised using the straight-line method over estimated useful
+lives of gas station.
+Patent and other intangible assets are initially recorded at actual cost, and amortised using the straight-line method
+over their estimated useful lives.
+Research expenditure incurred is recognised as an expense. Costs incurred on development projects shall not be
+capitalised unless they satisfy the following conditions simultaneously:
+The carrying amount of intangible assets is written down to its recoverable amount when the recoverable amount is
+lower than the carrying amount (Note 4(16)). The estimated useful years and amortisation method of the intangible assets
+with finite useful life are reviewed, and adjusted if appropriate, at each financial year-end.
+2021 ANNUAL REPORT
+137
+FINANCIAL STATEMENTS PetroChina
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+Goodwill is not amortised and is stated in the balance sheet at cost less accumulated impairment losses (Note
+4(16)). On disposal of an asset group or a set of asset groups, any attributable goodwill is written off and included in the
+calculation of the profit or loss on disposal.
+The initial cost of goodwill represents the excess of cost of acquisition over the acquirer's interest in the fair value of
+the identifiable net assets of the acquiree under a business combination not involving entities under common control.
+FINANCIAL STATEMENTS PetroChina
+Borrowing costs incurred that are directly attributable to the acquisition and construction of fixed assets and oil
+and gas properties, which require a substantial period of time for acquisition and construction activities to get ready
+for their intended use, are capitalised as part of the cost of the assets when capital expenditures and borrowing costs
+have already incurred and the activities of acquisition and construction necessary to prepare the assets to be ready for
+their intended use have commenced. The capitalisation of borrowing costs ceases when the assets are ready for their
+intended use. Borrowing costs incurred thereafter are recognised as financial expense. Capitalisation of borrowing costs
+should be suspended during periods in which the acquisition or construction of a fixed asset is interrupted abnormally,
+and the interruption lasts for more than 3 months, until the acquisition or construction is resumed.
+Where a general borrowing is used for the acquisition or construction of fixed asset and oil and gas property eligible
+for capitalisation, the Group shall calculate and determine the to-be-capitalised amount of interests on the general
+borrowing by multiplying the part of the accumulative asset disbursements in excess of the weighted average asset
+disbursement for the specifically borrowed fund by the weighted average actual rate of the general borrowing used. The
+actual rate is the rate used to discount the future cash flow of the borrowing during the expected existing period or the
+applicable shorter period to the originally recognised amount of the borrowing.
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+(20) Provisions
+Provisions for product guarantee, quality onerous contracts etc. are recognised when the Group has present
+obligations, and it is probable that an outflow of economic benefits will be required to settle the obligations, and the
+amounts can be reliably estimated.
+Provisions are measured at the best estimate of the expenditures expected to be required to settle the present
+obligation. Factors surrounding the contingencies such as the risks, uncertainties and the time value of money shall be
+taken into account as a whole in reaching the best estimate of provisions. Where the effect of the time value of money
+is material, the best estimate is determined by discounting the related future cash flows. The increase in the discounted
+amount of the provision arising from the passage of time is recognised as interest expense.
+140
+Asset retirement obligations which meet the criteria of provisions are recognised as provisions and the amount
+recognised is the present value of the estimated future expenditure determined in accordance with local conditions
+and requirements, while a corresponding addition to the related oil and gas properties of an amount equivalent to
+the provision is also created. This is subsequently depleted as part of the costs of the oil and gas properties. Interest
+expenses from the assets retirement obligations for each period are recognised with the effective interest method during
+the useful life of the related oil and gas properties. Due to technological progress, legal requirements or changes in the
+market environment, changes in the provisions caused by changes in the amount of expenditure, estimated time of
+retirement obligations, discount rate, etc., may occur in fulfilling the retirement obligation. For an increase in provisions,
+the cost of oil and gas properties will be increased accordingly; for a decrease in provisions, the cost of oil and gas
+properties will be deducted within the limit of the carrying amount of assets related to decommissioning expenses. If a
+decrease in the provision exceeds the carrying amount of the oil and gas properties recognised corresponding to the
+provision, the excess shall be recognised immediately in profit or loss.
+(21) Income tax
+Current and deferred taxes are recognised in profit or loss, except for income tax arising from business combination
+or transactions or events which are directly included in owners' equity (including other comprehensive income).
+Current tax is the expected tax payable on the taxable income for the year, using tax rates stipulated by the tax law,
+and any adjustment to tax payable in respect of previous years.
+At the balance sheet date, current tax assets are offset against current tax liabilities if the Group has a legal right to
+settle on a net basis and intends to settle on a net basis, or to realise the asset and settle the liability simultaneously.
+Deferred tax assets and deferred tax liabilities are calculated and recognised based on the differences (temporary
+differences) arising between the tax bases of assets and liabilities and their carrying amounts. The deductible losses,
+which can be utilised against the future taxable profit in accordance with tax law, are regarded as temporary differences
+and a deferred tax asset is recognised accordingly. The deferred tax assets and deferred tax liabilities are not accounted
+for the temporary differences resulting from initial recognition of an asset or liability in a transaction other than a business
+combination that at the time of the transaction affects neither accounting nor taxable profits (or deductible loss). Deferred
+tax assets and deferred tax liabilities are determined using tax rates that are expected to apply to the period when the
+related deferred tax asset is realised or the deferred tax liability is settled.
+2021 ANNUAL REPORT
+If the conditions for the recognition of the provisions are not met, the expenditures for the decommissioning, removal
+and site cleaning will be expensed in profit or loss when occurred.
+For a borrowing taken specifically for the acquisition or construction activities for preparing fixed asset and oil and
+gas property eligible for capitalisation, the to-be-capitalised amount of interests shall be determined according to the
+actual costs incurred less any income earned on the unused borrowing fund as a deposit in the bank or as a temporary
+investment.
+Government grants related to daily activities are recognised in other income or written down the related cost and
+expenses according to the nature of business activities. Government grants related to non-daily activities are recognised
+in non-operating income or expenses.
+If a government grant is in the form of a transfer of a monetary asset, it is measured at the amount received or
+receivable. If a government grant is in the form of a transfer of a non-monetary asset, it is measured at fair value.
+2021 ANNUAL REPORT 139
+FINANCIAL STATEMENTS PetroChina
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+(18) Employee Compensation
+(a) Short-term benefits
+Government grants related to assets are grants whose primary condition is that the Group qualifying for them
+should purchase, construct or otherwise acquire long-term assets. Government grants related to income are grants
+other than those related to assets. A government grant related to an asset is recognised initially as deferred income and
+amortised to profit or loss in a reasonable and systematic manner within the useful life of the relevant assets. A grant that
+compensates the Group for expenses or losses to be incurred in the future is recognised initially as deferred income, and
+recognised in profit or loss or released to relevant cost in the period in which the expenses or losses are recognised. A
+grant that compensates the Group for expenses or losses already incurred is recognised to profit or loss or released to
+related cost immediately.
+Employee wages or salaries, bonuses, social security contributions such as medical insurance, work injury
+insurance, maternity insurance and housing fund, measured at the amount incurred or at the applicable benchmarks and
+rates, are recognised as a liability as the employee provides services, with a corresponding charge to profit or loss or
+included in the cost of assets where appropriate.
+Pursuant to the relevant laws and regulations of the People's Republic of China, the Group participated in a
+defined contribution basic pension insurance in the social insurance system established and managed by government
+organisations. The Group has similar defined contribution plans for its employees in its overseas operations. The Group
+makes contributions to basic pension insurance plans based on the applicable benchmarks and rates stipulated by the
+government. Basic pension insurance contributions are recognised as part of the cost of assets or charged to profit or
+loss as the related services are rendered by the employees.
+In addition, the Group joined the corporate annuity plan approved by relevant PRC authorities. Contribution to the
+annuity plan is charged to expense as incurred.
+The Group has no other material obligation for the payment of pension benefits associated with schemes beyond
+the contributions described above.
+(19) Government grants
+Government grants are non-reciprocal transfers of monetary or non-monetary assets from the government to the
+Group except for capital contributions from the government in the capacity as an investor in the Group.
+A government grant is recognised when there is reasonable assurance that the grant will be received and that the
+Group will comply with the conditions attaching to the grant.
+(b) Post-employment benefits-Defined Contribution Plans
+Deferred tax assets and liabilities which meet the following conditions shall be presented on a net basis:
+156 PETROCHINA COMPANY LIMITED
+The Group's cash at bank and on hand in foreign currencies mainly comprise cash at bank.
+A transaction constitutes a business combination when the Group obtains control of one or more entities (or a
+group of assets or net assets). Business combination is classified as either business combinations involving enterprises
+under common control or business combinations not involving enterprises under common control.
+(27) Business Combination
+Dividend distribution is recognised as a liability in the period in which it is approved by a resolution of shareholders'
+general meeting.
+(26) Dividend Distribution
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+148
+Where an operation is classified as discontinued in the current period, profit or loss from continuing operations
+and profit or loss from discontinued operations are separately presented in the income statement for the current period.
+Profit or loss from continuing operation in the comparative income statement is re-presented as if the operation had been
+discontinued from the start of the comparative year.
+It is a subsidiary acquired exclusively with a view to resale.
+It is part of a single co-ordinated plan to dispose of a separate major line of business or a separate geographical
+area of operations;
+• It represents a separate major line of business or a separate geographical area of operations;
+The Group classifies a separate component as a discontinued operation either upon disposal of the operation or
+when the operation meets the criteria to be classified as held for sale if it is separately identifiable and satisfies one of the
+following conditions:
+Accounting treatments for business combinations involving entities under common control and not under common
+(b) Discontinued Operations
+It is highly probable that the sale happens, that is, the Group has made a decision on a sale plan and has signed a
+legally binding purchase agreement with other parties, and it is expected that the sale will be completed within one
+year.
+• According to the practice of sale such assets or disposal groups in similar transactions, the non-current assets or
+disposal groups can be disposed immediately under current conditions;
+The Group classifies non-current assets or disposal groups meeting the following conditions into held for sale
+simultaneously:
+Disposal groups refer to a group of assets that are disposed of by sale or other means as a whole in a transaction,
+as well as the liabilities directly related to such assets transferred in the transaction.
+When the Group recovers the book value of a non-current asset or disposal group mainly through the sale rather
+than through continuing use, non-current assets or disposal groups are classified as held for sale.
+(a) Held for Sale
+(25) Held for Sale and Discontinued Operations
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS PetroChina
+147
+2021 ANNUAL REPORT
+The non-current assets held for sale (excluding financial assets, deferred income tax assets) or the disposal groups
+are generally measured at the lower of their carrying amount and fair value less costs to sell in initial and subsequent
+measurement, and the difference between the carrying amount and fair value less costs to sell is recognised as asset
+impairment loss in profit and loss.
+Lease receipts from operating leases is recognised as income using the straight-line method over the lease term.
+The initial direct costs incurred in respect of the operating lease are initially capitalised and subsequently amortised in
+profit or loss over the lease term on the same basis as the lease income. Variable lease payments not included in lease
+receipts are recognised as income as they are earned.
+control.
+For a transaction not involving enterprises under common control, the acquirer determines whether acquired set of
+assets constitute a business. The Group may elect to apply the simplified assessment method, the concentration test,
+to determine whether an acquired set of assets is not a business. If the concentration test is met and the set of assets is
+determined not to be a business, no further assessment is needed. If the concentration test is not met, the Group shall
+perform the assessment according to the guidance on the determination of a business.
+If a party has the power to control, jointly control or exercise significant influence over another party, or vice versa, or
+where two or more parties are subject to common control or joint control from another party, they are considered to be
+related parties. Related parties may be individuals or enterprises. Enterprises with which the Company is under common
+control only from the State and that have no other related party relationships are not regarded as related parties.
+(30) Related Party
+The Group also discloses total external revenue derived from other regions outside China's mainland and the total
+non-current assets located in other regions outside China's mainland.
+An operating segment refers to a component of the Group that simultaneously meet the following criteria: (1) the
+component can generate revenue and incur expenses in ordinary activities; (2) the component's operating results can
+be regularly reviewed by the Group's management to make decisions about resource allocation to the component and
+assess its performance; (3) the Group can obtain financial information relating to the financial position, operating results
+and cash flows, etc. of the component. When two or more operating segments exhibit similar economic characteristics
+and meet certain requirements, the Group may aggregate these operating segments into a single operating segment.
+The Group determines its operating segments based on its organisational structure, management requirements and
+internal reporting system. On the basis of these operating segments, the Group determines the reporting and disclosure
+of segmental information.
+(29) Segment Reporting
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+FINANCIAL STATEMENTS
+150 PETROCHINA COMPANY LIMITED
+All material intercompany balances, transactions and unrealised gains within the Group are eliminated upon
+consolidation. The portion of the shareholders' equity or net profit of the subsidiaries that is not attributable to the
+Company is treated as non-controlling interests and total comprehensive income and presented separately within
+shareholders' equity in the consolidated balance sheet or within net profit and total comprehensive income in the
+consolidated income statement.
+When the accounting policies and accounting periods of subsidiaries are not consistent with those of the Company,
+the Company will make necessary adjustments to the financial statements of the subsidiaries in accordance with the
+Company's accounting policies and accounting periods. Where a subsidiary was acquired during the reporting period,
+through a business combination involving entities not under common control, the identifiable assets and liabilities of the
+acquired subsidiaries are included in the scope of consolidation from the date that control commences, based on the fair
+value of those identifiable assets and liabilities at the acquisition date.
+Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are
+deconsolidated from the date that control ceases. Where a subsidiary was acquired, through a business combination
+involving entities under common control, the financial statements of the subsidiary are included in the consolidated
+financial statements based on the carrying amounts of the assets and liabilities of the subsidiary in the financial
+statements of the ultimate controlling party as if the combination had occurred at the date that the ultimate controlling
+party first obtained control. The opening balances and the comparative figures of the consolidated financial statements
+are also restated. And their net profit earned before the combination date shall be presented separately in the
+consolidated income statement.
+Company
+The scope of consolidated financial statements includes the Company and its subsidiaries controlled by the
+Company. Control exists when the Group has all the following: power over the investees; exposure, or rights to variable
+returns from its involvement with the investees and has the ability to affect those returns through its power over the
+investee. When assessing whether the Group has power, only substantive rights (held by the Group and other parties) are
+considered.
+Costs which are directly attributable to the business combination are recorded in profit or loss when incurred. The
+transaction costs of the equity securities or debt securities issued which are attributable to the business combination are
+recorded in the initial recognition costs when acquired. The acquisition date is the date on which the acquirer obtains
+control of the acquiree.
+A business combination involving entities not under common control is a business combination in which all of
+the combining entities are not ultimately controlled by the same party or parties both before and after the business
+combination. The acquisition costs paid and the acquiree's identifiable asset, liabilities and contingent liabilities, if the
+recognition criteria are met, are measured at their fair value at the acquisition date. Where the cost of combination
+exceeds the acquirer's interest in the fair value of the acquiree's identifiable net assets, the difference is recognised as
+goodwill. Where the cost of combination is less than the acquirer's interest in the fair value of the acquiree's identifiable
+net assets, the difference is recognised directly in profit or loss.
+(b) Business combination not under common control
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS PetroChina
+149
+2021 ANNUAL REPORT
+Costs incurred directly attributable to the business combination are recorded in profit or loss when incurred. The
+transaction costs of the equity securities or debt securities issued which are attributable to the business combination are
+recorded in the initial recognition costs when acquired. The combination date is the date on which one combining entity
+obtains control of other combining entities.
+A business combination involving entities under common control is a business combination in which all of the
+combining entities are ultimately controlled by the same party or parties both before and after the business combination,
+and that control is not transitory. The net assets obtained by the acquirer are measured based on their carrying value in
+the consolidated financial statement of the ultimate controlling party at the combination date. The difference between
+the carrying value of the net assets obtained and the carrying value of the consideration is adjusted against the capital
+surplus. If the capital surplus is not sufficient to be offset, the remaining balance is adjusted against retained earnings.
+(a) Business combination under common control
+When the set of assets the group acquired does not constitute a business, acquisition costs should be allocated
+to each identifiable assets and liabilities at their acquisition-date fair values. It is not required to apply the accounting of
+business combination described as below.
+(28) Basis of Preparation of Consolidated Financial Statements
+In addition to the related parties stated above, the Company determines related parties based on the disclosure
+requirements of Administrative Procedures on the Information Disclosures of Listed Companies issued by the CSRC.
+The Group determines at lease inception whether each lease is a finance lease or an operating lease. A lease is
+classified as a finance lease if it transfers substantially all the risks and rewards incidental to ownership of an underlying
+asset irrespective of whether the legal title to the asset is eventually transferred. An operating lease is a lease other than a
+finance lease. There are no significant finance leases for the Group.
+The Group has elected not to recognise right-of-use assets and lease liabilities for short-term leases that have a
+lease term of 12 months or less and leases of low-value assets. The Group recognises the lease payments associated
+with these leases in profit or loss or as the cost of the assets where appropriate using the straight-line method over the
+lease term.
+The Group's cash at bank and on hand included the following foreign currencies as of December 31, 2020:
+78,948
+845
+PRC
+7.2197
+7,500
+0.8176
+9,173
+338
+68,163
+6.3757
+10,691
+RMB equivalent
+USD
+Exchange rate
+Other
+EUR
+HKD
+USD
+The Group's cash at bank and on hand included the following foreign currencies as of December 31, 2021:
+145,950
+714
+704
+163,536
+145,208
+162,814
+28
+18
+Foreign currency
+(b) The Group as a lessor
+HKD
+Other
+When the lease liability is remeasured, a corresponding adjustment is made to the carrying amount of the right-of-
+use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.
+• There is a change in the assessment of whether the Group will exercise a purchase, extension or termination
+option, or there is a change in the exercise of the extension or termination option.
+• There is a change in future lease payments resulting from a change in an index or a rate used to determine those
+payments;
+• There is a change in the amounts expected to be payable under a residual value guarantee;
+Under the following circumstances after the commencement date, the Group remeasures lease liabilities based on
+the present value of revised lease payments:
+A constant periodic rate is used to calculate the interest on the lease liability in each period during the lease term
+with a corresponding charge to profit or loss or included in the cost of assets where appropriate. Variable lease payments
+not included in the measurement of the lease liability is charged to profit or loss or included in the cost of assets where
+appropriate as incurred.
+The lease liability is initially measured at the present value of the lease payments that are not paid at the
+commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined,
+the Group's incremental borrowing rate.
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+FINANCIAL STATEMENTS
+Limited
+HK Dollar Investment holding. The
+("HKD") principal activities of its
+7,592 million
+subsidiaries, associates
+and joint ventures are the
+exploration, production
+and sale of crude oil in and
+outside the PRC as well
+as natural gas sale and
+transmission in the PRC
+EUR
+31,314 Investment holding. The
+principal activities of its.
+subsidiaries, associates
+and joint ventures are the
+exploration, development
+and production of crude oil,
+natural gas, oilsands and
+1,216
+1,461
+8.0250
+7,661
+0.8416
+9,103
+182
+65,360
+6.5249
+10,017
+RMB equivalent
+Exchange rate
+Foreign currency
+coalbed methane outside the
+PRC
+(31) Critical Accounting Estimates and Judgements
+Estimates and judgements are continually evaluated and are based on historical experience and other factors,
+including expectations of future events that are believed to be reasonable under the circumstances.
+The critical accounting estimates and key assumptions that have a significant risk of causing a material adjustment
+to the carrying amounts of assets and liabilities within the next financial year are outlined below:
+Zhu 66,720
+Guowen
+Limited
+liability
+company
+47,500 Exploration, production and
+sale of crude oil and natural
+gas
+16,100 Exploration, production and
+sale of crude oil and natural
+gas outside the PRC
+PRC
+Business
+combination
+under
+common
+Development
+Exploration
+and
+CNPC
+Limited
+Company
+PRC
+Established
+100.00
+Daqing Oilfield
+%
+%
+rights -dated
+interest
+voting Consoli
+equity
+Type of Legal effective
+legal repre- invest-
+entity sentativement cost
+Principal activities
+capital
+method -ration
+name
+Acquisition incorpo Registered
+or not
+Company
+100.00
+Limited
+liability Xiandeng
+company
+Established
+PetroChina
+Limited
+Company
+Investment
+International
+PRC
+Established
+PetroChina
+company
+liability
+Yes
+Yes
+100.00 100.00
+Limited
+Kong Limited
+HK
+PetroChina Hong Established
+Limited (i)
+Company
+control
+Yes
+57.14
+50.00
+23,778
+Ye
+N/A 25,590
+table
+table
+Closing
+City maintenance and construction tax
+City Maintenance and Construction Tax
+Educational surcharge
+Crude Oil Special Gain Levy
+Corporate Income Tax
+Consumption Tax
+Resource Tax
+Value Added Tax (the "VAT")
+Types of taxes
+The principal taxes and related tax rates of the Group are presented as below:
+5 TAXATION
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+FINANCIAL STATEMENTS
+Tax rate
+PETROCHINA COMPANY LIMITED
+According to changes in the internal and external environment, accounting standards and company asset
+retirement expense measures and other relevant regulations, oil and gas field companies recalculate their asset retirement
+obligations of oil and gas properties based on the latest parameters to more objectively reflect the actual situation of the
+Company's asset retirement obligation of oil and gas properties.
+Provision is recognised for the future decommissioning and restoration of oil and gas properties. The amounts
+of the provision recognised are the present values of the estimated future expenditures. The estimation of the future
+expenditures is based on current local conditions and requirements, including legal requirements, technology, price level,
+etc. In addition to these factors, the present values of these estimated future expenditures are also impacted by the
+management plan for the decommissioning of oil and gas properties, the estimation of the economic lives of oil and gas
+properties and estimates of discount rates. Changes in any of these estimates will impact the operating results and the
+financial position of the Group over the remaining economic lives of the oil and gas properties.
+(c) Estimation of asset retirement obligations
+Fixed assets and oil and gas properties are reviewed for possible impairments when events or changes in
+circumstances indicate that the carrying amount may not be recoverable. Determination as to whether and how much
+an asset is impaired involves management estimates and judgements such as future price of crude oil and natural gas,
+refined and chemical products, the production costs, the product mix, production volumes, production profile and the oil
+and gas reserves. However, the impairment reviews and calculations are based on assumptions that are consistent with
+the Group's business plans taking into account current economic conditions. Favourable changes to some assumptions,
+or not updating assumptions previously made, may allow the Group to avoid the need to impair any assets, whereas
+unfavourable changes may cause the assets to become impaired. For example, when the assumed future price and
+production profile of crude oil used for the expected future cash flows are different from the actual price and production
+profile of crude oil respectively experienced in the future, the Group may either over or under recognise the impairment
+losses for certain assets.
+(b) Estimation of impairment of fixed assets and oil and gas properties
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS PetroChina
+151
+2021 ANNUAL REPORT
+Estimates of oil and natural gas reserves are key elements in the Group's investment decision-making process.
+They are also important elements in testing for impairment related to oil and gas production activities. Changes in
+proved oil and natural gas reserves, particularly proved developed reserves, will affect unit-of-production depreciation,
+depletion and amortisation recorded in the income statements for property, plant and equipment related to oil and gas
+production activities. An increase/reduction in proved developed reserves will decrease/increase depreciation, depletion
+and amortisation charges. Proved reserve estimates are subject to revision, either upward or downward, based on new
+information, such as from development drilling and production activities or from changes in economic factors, including
+product prices, contract terms, evolution of technology or development plans, etc.
+(a) Estimation of oil and natural gas reserves
+152
+13%, 9%, 6%
+6%
+Based on quantities
+Country
+of
+Attribu-
+Attribu-
+(1) Principal subsidiaries
+6 BUSINESS COMBINATION AND CONSOLIDATED FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+FINANCIAL STATEMENTS
+154 PETROCHINA COMPANY LIMITED
+According to "Notice Concerning Levy of Import Consumption Tax on Certain Refined Oil Products" (Notice 2021
+No.19 issued by Ministry of Finance, General Administration of Customs and State Taxation Administration), which takes
+effect on 12 June 2021, for imported goods under HS code 27075000 and whose aromatic hydrocarbon mixtures lower
+than 95% by volume distils below 200 degrees Celsius, the import consumption tax shall be levied at the unit tax rate of
+1.52 RMB/liter for naphtha; Import consumption tax on naphtha shall be levied at the unit tax rate of 1.52 yuan/liter for
+imported products classified into HS code 27079990 and 27101299. For the imported products which are classified
+into HS code 27150000 and the mineral oil distilled below 440 degrees Celsius is more than 5% by volume, it shall be
+regarded as fuel oil, and the import consumption tax shall be levied at the unit tax of 1.2 yuan/liter.
+In accordance with the Circular jointly issued by Ministry of Finance, the General Administration of Customs of
+the PRC and State Taxation Administration on Issues Concerning Tax Policies for In-depth Implementation of Western
+Development Strategy (Cai Shui [2011] No.58), the corporate income tax for the enterprises engaging in the encouraged
+industries in the Western China Region is charged at a preferential corporate income tax rate of 15% from January 1,
+2011 to December 31, 2020. Certain branches and subsidiaries of the Company in the Western China Region obtained
+the approval for the use of the preferential corporate income tax rate of 15%. Ministry of Finance, State Taxation
+Administration and the NDRC issued the Announcement on Continuing the Income Tax Policy for Western Development
+(Notice No.23 of 2020 of MOF), the corporate income tax for the enterprises engaging in the encouraged industries
+in the Western China Region is charged at a preferential corporate income tax rate of 15% from January 1, 2021 to
+December 31, 2030.
+Pursuant to the Notice from Ministry of Finance on the "Increase of the Threshold of the Crude Oil Special Gain
+Levy" (Cai Shui [2014] No. 115), the threshold of the crude oil special gain levy shall be USD 65 per barrel, which has
+5 levels and is calculated and charged according to the progressive and valorem rates on the excess amounts from
+January 1, 2015.
+Ministry of Finance and State Taxation Administration jointly issued the "Notice on Reduction of Resource Tax
+Assessed on Shale Gas" (Cai Shui [2018] No.26) on March 29, 2018. Pursuant to such notice, in order to promote
+the development and utilization of shale gas and effectively increase natural gas supply, from April 1, 2018 to March
+31, 2021, a reduction of 30% will apply to the resource tax assessed on shale gas (at the prescribed tax rate of 6%).
+On March 15, 2021, Ministry of Finance and State Taxation Administration jointly issued "Notice on Extending the
+Implementation Period of Some Preferential Tax Policies" (Caishui [2021] No.6) to announce the implementation period of
+that preferential tax policies would be extended to December 31, 2023.
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS PetroChina
+2021 ANNUAL REPORT 153
+According to "Notice Concerning Import Tax Policies Related to Exploration, Development and Utilization of Energy
+Resources During the 14th Five-Year Plan Period" (Caishui [2021] No.17) jointly issued by Ministry of Finance, State
+Taxation Administration and General Administration of Customs, for the period from January 1, 2021 to December 31,
+2025, the import value-added tax (VAT) of the import link shall be returned in proportion to the projects of cross-border
+natural gas pipelines and imported liquefied natural gas (LNG) receiving storage and transportation units approved by
+National Development and Reform Commission. This also includes natural gas imported from the expansion project of
+the import LNG receiving storage and transportation plant approved by the provincial governments. The import duties of
+equipment, instruments, zero accessories and special tools shall be exempted to the self-employed projects carrying out
+oil (natural gas) exploration and development operations in particular areas within the territory of China. The import duties
+and import value-added tax (VAT) of equipment, instruments, zero accessories and special tools shall be exempted to
+the Sino-foreign cooperation project carrying out oil (natural gas) exploration and development operations within the
+winning block of onshore oil (natural gas) approved by the State, projects carrying out oil (natural gas) exploration and
+development operations in China's oceans, emergency rescue projects for offshore oil and gas pipelines, and projects
+carrying out coal seam gas exploration and development operations in China.
+Based on the actual land area occupied in each
+provinces, autonomous regions and municipalities.
+Based on the actual VAT and consumption tax paid.
+Based on the actual VAT and consumption tax paid.
+Based on the sales of domestic crude oil at prices
+higher than a specific level.
+Based on taxable income.
+Based on sales quantities of taxable products. RMB
+1.52 per litre for unleaded gasoline, naphtha,
+solvent oil and lubricant. RMB 1.2 per litre for diesel
+and fuel oil.
+Based on the revenue from sales of crude oil and
+natural gas.
+Based on taxable value added amount. Tax payable
+is calculated using the taxable sales amount
+multiplied by the applicable tax rate less current
+period's deductible VAT input.
+Tax basis and method
+1%, 5% or 7%
+2% or 3%
+RMB 0.9-30
+5% to 82%
+20% to 40%
+December 31, 2020
+December 31, 2021
+2,440
+Cash at bank
+KunLun Energy
+Limited
+company
+products production,
+sales, chemical technology
+development, technical
+Company
+Petrochemical
+Yes
+90.00
+90.00
+21,600
+Wang
+Bin
+Limited
+liability
+petrochemical, chemical
+Sichuan
+10,000 Engaged in oil refining,
+PRC
+Established
+75,698
+Other cash balances
+18,096 Marketing of refined products
+and trading of crude oil and
+petrochemical products,
+storage, investment
+Limited
+Ye 31,314 100.00 100.00
+liability Xiandeng
+company
+Yes
+Limited Tian Jinghui 18,953 100.00 100.00
+Company
+Limited (ii)
+liability
+company
+in refining, chemical
+engineering, storage
+facilities, service station,
+and transportation facilities
+and related business in and
+outside the PRC
+PetroChina
+Yes
+Business Bermuda
+combination
+under
+common
+International
+transfer and services
+(ii) Kunlun Energy Co., Ltd. is a company listed on The Stock Exchange of Hong Kong Limited.
+2021 ANNUAL REPORT 155
+FINANCIAL STATEMENTS PetroChina
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+(2) Exchange rates of international operations' major financial statement items
+Company name
+PetroKazakhstan Inc.
+PetroChina Hong Kong Limited
+Singapore Petroleum Company Limited
+December 31, 2021
+December 31, 2020
+USD 1=6.3757 yuan
+USD 1=6.5249 yuan
+HKD 1=0.8176 yuan
+HKD 1=0.8416 yuan
+USD 1-6.3757 yuan
+USD 1-6.5249 yuan
+Revenue, expense, cash flows items and equity items except for the retained earnings are translated into RMB at
+the exchange rates at the date of the transactions or the approximate exchange rates at that date.
+7 CASH AT BANK AND ON HAND
+control
+(i) The Company consolidated the financial statements of the entity because it is exposed to, or has rights to, variable returns from its
+involvement with the entity and has the ability to affect those returns through its power over the entity.
+87 million
+Assets and liabilities
+HK Dollar Investment holding. The
+("HKD") principal activities of its
+160 million principal subsidiaries,
+associates and joint ventures
+are the sales of natural gas,
+sales of liquefied petroleum
+gas and liquefied natural
+gas processing and terminal
+business in the PRC and the
+exploration and production
+of crude oil and natural gas
+in the PRC, the Republic of
+Kazakhstan, the Sultanate of
+Oman, the Republic of Peru,
+the Kingdom of Thailand and
+the Republic of Azerbaijan.
+("HKD")
+Yes
+54.38
+54.38
+Limited
+liability
+company
+Cash on hand
+Fu Bin HK Dollar
+1,485
+Net profit
+8,413
+6,006
+3,383
+520
+Total comprehensive income/(loss)
+5,231
+(6,972)
+3,383
+Profit attributable to non-controlling
+interests
+4,837
+35,319
+3,311
+338
+52
+Dividends paid to non-controlling interests
+307
+1,498
+520
+2,017
+48,493
+33,312
+184,486
+182,392
+25,317
+26,371
+11,282
+21,820
+3,876
+5,382
+30,293
+22,566
+382
+486
+158,507
+154,052
+25,032
+24,781
+Summarised statement of comprehensive income is as follows:
+CNPC Exploration and
+Development Company Limited
+PetroChina Sichuan
+Petrochemical Company Limited
+2021
+2020
+2021
+2020
+Operating income
+42,730
+12
+222
+PetroChina Sichuan
+CNPC Exploration and
+Development Company Limited
+Investment
+income
+Other
+comprehen-
+Invest-
+recognised
+ment
+December
+under equity
+cost
+31, 2020
+method
+sive
+Cash
+income/ dividend
+(loss) declared Other
+PETROCHINA COMPANY LIMITED
+December
+PipeChina
+149,500
+151,135
+6,845
+1
+(943)
+308
+157,346
+CP Finance
+10,223
+24,114
+31, 2021
+Summarised statement of cash flow is as follows:
+166
+2020
+Petrochemical Company Limited
+2021
+2021
+(29)
+(33)
+(311)
+1,336
+Net assets
+740
+(PetroChina) Co., Ltd.
+China Marine Bunker
+5,119
+3,410
+207
+3,281
+2,450
+CNPC Captive Insurance
+Co., Ltd.
+25,033
+Net cash inflows from operating activities
+(904)
+(194)
+13,320
+5,681
+2,666
+(78)
+Non-current liabilities
+December
+Non-current assets
+(1,504)
+1,754
+(325)
+937
+46
+(344)
+Group's share of total comprehensive
+(loss)/income
+(3,007)
+3,508
+(650)
+1,874
+Dividends received by the group
+140
+Total comprehensive (loss)/income
+(6,067)
+(559)
+(1,012)
+(240)
+(45)
+(81)
+Other comprehensive loss
+66,720
+66,720
+66,720
+(691)
+CNPC Exploration and Development
+29
+539
+Daqing Oilfield Company Limited
+December
+31, 2021
+Deduction
+Additions
+31, 2020
+cost
+December
+Investment
+(166)
+(605)
+(57)
+233
+(496)
+(49)
+(60)
+(60)
+December 31, 2020
+December 31, 2021
+Investment in subsidiaries:
+(c) Subsidiaries
+PetroChina Shouqi Sales Company Limited
+PetroChina Beiqi Sales Company Limited
+Other
+Associates and joint ventures
+(b) Provision for impairment
+410
+(49)
+Current liabilities
+Company Limited
+23,778
+165
+FINANCIAL STATEMENTS PetroChina
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+Summarised financial information in respect of the Group's principal subsidiaries with significant non-controlling
+interest is as follows:
+December
+31, 2021
+Summarised balance sheet is as follows:
+CNPC Exploration and
+Development Company Limited
+December
+31, 2020
+PetroChina Sichuan
+Petrochemical Company Limited
+2021 ANNUAL REPORT
+December
+31, 2020
+Percentage ownership interest (%)
+50.00
+50.00
+90.00
+90.00
+Current assets
+15,596
+16,046
+3,973
+4,278
+31, 2021
+23,778
+255,416
+(1,743)
+(1,743)
+23,778
+PetroChina Hong Kong Limited
+25,590
+25,590
+25,590
+PetroChina International Investment
+Company Limited
+31,314
+31,314
+31,314
+PetroChina International Company
+67,461
+Limited
+18,953
+18,953
+PetroChina Sichuan Petrochemical
+Company Limited
+21,600
+21,600
+21,600
+Other
+68,210
+Total
+994
+994
+18,953
+256,165
+(167)
+3,060
+31, 2020
+58,073
+53,465
+7,785
+8,687
+(1,414)
+(1,140)
+(356)
+(275)
+56,659
+52,325
+31, 2021
+7,429
+The aging of accounts receivable and related provision for bad debts are analysed as follows:
+The Group
+Amount
+December 31, 2021
+Percentage of
+total balance %
+Provision for
+bad debts
+Amount
+December 31, 2020
+Percentage of
+total balance %
+Provision for
+bad debts
+Within 1 year
+1 to 2 years
+55,579
+1,092
+8,412
+December
+December
+December
+31, 2020
+Trans-Asia Gas
+Pipeline Co.,
+Ltd.
+PRC
+162 PETROCHINA COMPANY LIMITED
+activities of its main
+subsidiaries are
+exploration, development
+and sale of oil and gas
+Main contractor,
+investment holding,
+investment management,
+investment consulting,
+enterprise management
+advisory, technology
+development, promotion
+and technology consulting
+5,000
+50.00 50.00
+Equity
+method
+No
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+Investments in principal associates and joint ventures are listed below:
+8 ACCOUNTS RECEIVABLE
+Accounts receivable
+Less: Provision for bad debts
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+The Group
+The Company
+December
+31, 2021
+95
+(133) 51,848
+96
+(207)
+Provision for
+bad debts
+Amount
+Percentage of
+total balance %
+Provision for
+bad debts
+Within 1 year
+7,298
+94
+(29)
+8,356
+96
+(22)
+1 to 2 years
+214
+3
+(98)
+201
+111
+1
+(67)
+2 to 3 years
+72
+(62)
+1
+Over 3 years
+December 31, 2020
+No
+December 31, 2021
+Percentage of
+total balance %
+The Company
+2
+(276)
+461
+1
+(87)
+2 to 3 years
+376
+1
+(182)
+230
+1
+(21)
+Over 3 years
+1,026
+2
+(823)
+926
+2
+(825)
+58,073
+100
+(1,414)
+53,465
+100
+(1,140)
+Amount
+13
+22
+Equity
+method
+(71)
+Finance expenses
+18
+17
+8,152
+11,543
+36,695
+58,210
+Operating income
+2020
+2021
+(81)
+2020
+2020
+2021
+Trans-Asia Gas
+Pipeline Co., Ltd.
+B.V.
+Mangistau Investment
+China Marine Bunker
+(PetroChina) Co., Ltd.
+The comprehensive income and dividends received by the group are listed as follows:
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+164
+2021
+(102)
+(75)
+Including: Interest income
+4,067
+362
+2,114
+185
+(610)
+Net (loss)/profit
+1
+(293)
+(846)
+(57)
+(56)
+Taxation
+(58)
+(56)
+(160)
+(141)
+(60)
+(72)
+Interest expense
+42
+31
+4
+3
+16
+11
+3
+("PipeChina")
+China Petroleum
+PRC
+PRC
+Insurance Co.,
+Ltd.
+Property loss insurance,
+liability insurance, credit
+insurance and deposit
+insurance; as well as the
+application of the above
+5,000
+49.00
+49.00
+Equity
+method
+No
+insurance reinsurance and
+insurance capital business
+China Marine
+Bunker
+(PetroChina)
+Co., Ltd.
+PRC Oil import and export trade
+and transportation, sale
+and storage
+1,000
+50.00 50.00
+Equity
+method
+Mangistau
+Netherlands
+Engaged in investment
+Investment B.V.
+activities, the principle
+USD
+50.00 50.00
+131 million
+CNPC Captive
+No
+acceptance discounting,
+No
+Finance Co.,
+Ltd. ("CP
+Finance")
+Pipeline transport,
+storage service, import
+of equipment, import and
+export of techniques,
+science and technology
+research, research
+and application of
+informatization, technology
+consulting, technology
+service, technology
+transfer, promotion of
+technology
+Deposits, loans,
+guarantee and other
+banking business
+Registered
+Voting Account
+rights
+Principal activities
+capital Direct Indirect
+-ing
+% method
+Group's
+activities
+500,000 29.90
+-
+29.90
+Equity
+method
+Yes
+Strategic
+decisions
+relating
+to the
+8,331 32.00
+32.00
+settlement, lending, bills
+Equity
+method
+N
+976
+2020
+176
+2 to 3 years
+1,620
+4
+(38)
+726
+3
+(12)
+Over 3 years
+4,169
+10
+(2,422)
+4,225
+21
+(2,573)
+40,983
+100
+(2,683)
+Provision for
+bad debts
+Percentage of
+total balance %
+Amount
+December 31, 2020
+December 31, 2021
+The Company
+(45)
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+FINANCIAL STATEMENTS PetroChina
+159
+2021 ANNUAL REPORT
+(2,674)
+100
+21,128
+PETROCHINA COMPANY LIMITED
+Amount
+25
+(33)
+261
+9,748
+Other receivables (a)
+38,300
+18,454
+4,058
+4,982
+Total
+39,554
+26,834
+4,327
+14,738
+(a) The aging analysis of other receivables and the related provision for bad debts are analysed as follows:
+The Group
+December 31, 2021
+Amount
+Percentage of
+total balance %
+3
+1,332
+1 to 2 years
+(44)
+51
+10,812
+5,365
+(190)
+33,862
+Within 1 year
+Provision for
+bad debts
+December 31, 2020
+Percentage of
+total balance %
+Amount
+Provision for
+bad debts
+83
+8,051
+Percentage of
+total balance %
+Within 1 year
+12 INVENTORIES
+Cost
+Crude oil and other raw materials
+Work in progress
+Finished goods
+Spare parts and consumables
+Less: Write down in inventories
+Net book value
+13 OTHER CURRENT ASSETS
+December 31, 2021
+December 31, 2020
+40,334
+35,855
+15,393
+12,387
+88,811
+80,739
+December 31, 2021
+14 INVESTMENT IN OTHER EQUITY INSTRUMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+160
+During the year ended December 31, 2021 and December 31, 2020, the Group had no significant write-off of other
+receivables.
+The balance of other current assets mainly consists of value-added tax recoverable and prepaid income tax.
+143,848
+(781)
+129,056
+144,629
+75
+91
+(517)
+128,539
+Provision for
+bad debts
+As of 31 December 2021 and 31 December 2020, the Group's other receivables are mainly in the first stage.
+The aging is counted starting from the date when other receivables are recognised.
+2,959
+53
+(953)
+2,479
+44
+(24)
+1 to 2 years
+646
+12
+(14)
+1,887
+33
+(8)
+2 to 3 years
+Over 3 years
+1,078
+20
+(29)
+(665)
+100
+5,647
+(1,438)
+100
+5,496
+As of December 31, 2021, the top five debtors of other receivables of the Group amounted to RMB 18,742,
+representing 46% of total other receivables, and there is no provision for bad and doubtful debts (As of December 31,
+2020 the top five debtors of other receivables of the Group amounted to RMB 6,218, representing 29% of total other
+receivables, and the corresponding balance of provision for bad and doubtful debts is RMB 509).
+(632)
+1,126
+(442)
+15
+813
+3
+155
+20
+741
+Dividends receivable
+8
+26
+1.6%
+50
+76
+One-two years past due
+648
+153
+25.5%
+126
+279
+Two-three years past due
+329
+67
+45.0%
+118
+185
+Over three years past due
+Weighted-average
+Impairment provision on provision
+matrix basis
+provision on
+Gross carrying
+Impairment
+1,414
+3,153
+816
+58,073
+819
+467
+94.7%
+352
+845
+598
+Impairment
+Within one year past due
+55
+219
+3
+(186)
+7,785
+100
+(356)
+8,687
+100
+(275)
+The aging is counted starting from the date when accounts receivable are recognised.
+2021 ANNUAL REPORT
+157
+FINANCIAL STATEMENTS PetroChina
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+The Group measures loss allowance for accounts receivable at an amount equal to lifetime ECLs. The ECLs were
+calculated by reference to the historical actual credit loss experience. The rates were considered the differences between
+economic conditions during the period over which the historical data has been collected, current conditions and the
+Group's view of economic conditions over the expected lives of the receivables. The Group performed the calculation of
+ECL rates by the operating segment and geography.
+Impairment provision on provision
+0.1%
+53,098
+Current (not past due)
+allowance
+provision
+loss rate
+55
+Loss
+Weighted-average
+Impairment
+provision on
+individual basis
+amount
+December 31, 2021
+Gross carrying
+matrix basis
+Impairment
+December 31, 2020
+amount
+individual basis
+As of December 31, 2021, accounts receivable included derivative financial assets, which were generated by
+hedges, of RMB 3,913 (2020:RMB 1,411).
+During the year ended December 31, 2021 and December 31, 2020, the Group had no significant write-off of
+accounts receivable.
+158 PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+9 RECEIVABLES FINANCING
+Receivables financing mainly represents bills of acceptance issued by banks for the sale of goods and rendering of
+services.
+The Group's business model of financial assets at fair value through other comprehensive income is achieved both
+by collecting contractual cash flows and selling of these assets.
+On December 31, 2021 and December 31, 2020, all receivables financing of the Group are due within one year.
+10 ADVANCES TO SUPPLIERS
+Advances to suppliers
+Less: Provision for bad debts
+December 31, 2021
+December 31, 2020
+14,900
+22,330
+8
+329
+513
+Interest receivable
+December 31, 2020
+December 31, 2020 December 31, 2021
+As of December 31, 2021, the top five debtors of accounts receivable of the Group amounted to RMB 16,728,
+representing 29% of total accounts receivable, and there is no provision for bad and doubtful debts (As of December
+31, 2020, the top five debtors of accounts receivable of the Group amounted to RMB 31,005, representing 58% of total
+accounts receivable, and the corresponding balance of provision for bad and doubtful debts is RMB 5).
+December 31, 2021
+Mangistau Investment B.V.
+11 OTHER RECEIVABLES
+As of December 31, 2021, the top five debtors of advances to suppliers of the Group amounted to RMB 6,930,
+representing 47% of total advances to suppliers (As of December 31, 2020, the top five debtors of advances to suppliers
+of the Group amounted to RMB12,840, representing 58% of total advances to suppliers).
+As of December 31, 2021 and 2020, advances to suppliers of the Group are mainly aged within one year.
+(704)
+21,626
+(302)
+14,598
+The Company
+1,140
+568
+572
+173
+19
+0.4%
+154
+5,326
+Within one year past due
+One-two years past due
+386
+34
+0.1%
+46,849
+Current (not past due)
+Loss
+allowance
+provision
+loss rate
+34
+December 31, 2020
+65
+22
+53,465
+825
+483
+94.3%
+342
+854
+6.9%
+Over three years past due
+10
+25.6%
+11
+50
+Two-three years past due
+87
+21
+Chengdu Huaqihoupu Holding Co., Ltd.
+The Group
+228
+2020
+2021
+2020
+2021
+31,2020
+2021
+From Oct 01,
+2020 to Dec
+CP Finance
+PipeChina
+CNPC Captive
+Insurance Co., Ltd.
+Summarised statement of comprehensive income and dividends received by the Group is as follows:
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS PetroChina
+163
+2021 ANNUAL REPORT
+3,281
+24,684
+23,765
+3,410
+3,281
+Goodwill
+349
+Operating income
+349
+in associates
+157,346
+151,135
+25,033
+24,114
+3,410
+Carrying amount of interest
+151,135
+101,572
+12,691
+904
+943
+Dividends received by the Group
+191
+207
+1,989
+1,823
+1,532
+6,846
+Group's share of total comprehensive
+income
+389
+424
+6,216
+5,698
+6,444
+29,778
+Total comprehensive income
+7,954
+1,510
+735
+Net profit
+29,776
+6,444
+22,766
+6,304
+424
+389
+Other comprehensive income/(loss)
+2
+(606)
+(1,603)
+7,819
+677
+157,346
+6,695
+Current assets
+29.90
+29.90
+Percentage ownership
+interest (%)
+31, 2020
+31, 2021
+December
+December
+Co., Ltd.
+CNPC Captive Insurance
+December
+31, 2020
+December
+31, 2021
+December
+31, 2020
+December
+31, 2021
+CP Finance
+PipeChina
+Summarised financial information in respect of the Group's principal associates and reconciliation to carrying
+amount is as follows:
+534
+3,917
+1,057
+(120)
+(233)
+4,621
+86,335
+Trans-Asia Gas Pipeline Co.,
+Ltd.
+20,065
+2,034
+(280)
+(410)
+21,409
+Interest in associates
+14,527
+Group's share of net assets
+74,012
+32.00
+6,959
+74,267
+570,282
+615,103
+Net assets
+2,776
+3,900
+12,617
+8,396
+104,150
+103,243
+Non-current liabilities
+4,752
+859
+404,201
+446,369
+55,562
+49.00
+49.00
+313,741
+9,100
+11,267
+Non-current assets
+32.00
+415,139
+768,161
+116,765
+177,344
+2,618
+2,956
+Current liabilities
+136,150
+655,982
+78
+77,139
+Interest in joint ventures
+195,739
+(227)
+451,677
+13,972
+(13)
+(3,425)
+206,286
+(240)
+461,462
+As of December 31, 2021, the above-mentioned investments are not subject to restriction on conversion into cash
+or remittance of investment income.
+2021 ANNUAL REPORT
+161
+FINANCIAL STATEMENTS PetroChina
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+(a) Principal associates and joint ventures of the Group
+Interest held%
+Company
+name
+China Oil & Gas
+21,409
+20,065
+Carrying amount of interest in
+joint ventures
+976
+1,336
+255,416
+4,621
+21,409
+20,065
+PRC
+Country of
+incorpo
+-ration
+Corporation
+Piping Network
+3,917
+3,917
+994
+December
+31, 2021
+China Pacific. Insurance (Group) Co., Ltd.
+Other items
+74
+133
+188
+509
+494
+1,176
+910
+15 LONG-TERM EQUITY INVESTMENTS
+The Group
+December
+31, 2020
+Additions
+Reduction
+December
+31, 2021
+20,831
+(5,206)
+266,489
+Reduction
+Additions
+December
+31, 2020
+The Company
+Less Provision for impairment
+Associates and joint ventures
+256,165
+Subsidiaries (c)
+250,864
+(166)
+Less Provision for impairment (b)
+Associates and joint ventures (a)
+(605)
+265,884
+4
+(443)
+250,698
+4,621
+(1,743)
+976
+9,927
+50.00
+44,011
+50.00
+39,809
+Current assets
+11,305
+1,685
+7,319
+830
+1,437
+2,886
+Including: cash and cash
+equivalents
+2,292
+2,220
+1,343
+1,571
+50.00
+Summarised balance sheet as included in their own financial statements, adjusted for fair value adjustments and
+differences in accounting policies in respect of the Group's principal joint ventures and reconciliation to carrying amount is
+as follows:
+China Marine Bunker
+(PetroChina) Co., Ltd.
+December December
+31, 2021 31, 2020
+1,336
+Mangistau Investment
+B.V.
+Trans-Asia Gas Pipeline
+Co., Ltd.
+Non-current assets
+December December
+31, 2021 31, 2020
+31, 2021
+31, 2020
+Percentage ownership interest
+(%)
+50.00
+50.00
+December December
+1,631
+50.00
+10,586
+42,818
+2,339
+2,919
+9,242
+7,833
+Group's share of net assets
+40,130
+40,130
+Net assets attributable to
+1,952
+2,672
+9,242
+7,833
+74
+42,818
+owners of the Company
+235
+Net assets
+2,033
+Non-current liabilities
+540
+158
+3,008
+1,411
+2,330
+2,147
+9,997
+5,927
+872
+575
+483
+Current liabilities
+739
+Additions
+December 31, 2020
+Post-employment benefits - defined
+contribution plans
+Short-term employee benefits
+Termination benefits
+Reduction
+Over 3 years
+8,599
+136,358
+(136,037)
+8,920
+(1) Employee compensation payable listed as below
+46
+4
+20,986
+145
+December 31, 2021
+29 EMPLOYEE COMPENSATION PAYABLE
+5
+28 CONTRACT LIABILITIES
+(20,983)
+5,966
+2
+12,740
+10,387
+237,102
+100
+220,318
+87
+5
+3
+5
+100
+As of December 31, 2021, accounts payable aged over one year amounted to RMB 29,070(December 31, 2020:
+RMB 27,902), and mainly comprised of unsettled payables to suppliers.
+As of December 31, 2021, accounts payable included derivative financial liabilities, which were generated by
+hedges, of RMB 3,881 (2020: RMB 3,709).
+Contract liabilities mainly represented advances from customers related to the sales of crude oil, natural gas and
+refined oil, etc. As of December 31, 2021, the contract liabilities aged over one year amounted to RMB 4,505 (December
+31, 2020: RMB 3,501). The majority of related obligations were expected to be performed with corresponding revenue
+recognised within one year. Substantially all of contract liabilities at the beginning of the year has been recognised as
+revenue for the year ended December 31,2021.
+8,649
+529
+(143)
+(157,163)
+Social security contributions
+537
+10,748
+(10,738)
+547
+Including:
+Medical insurance
+515
+9,806
+(9,792)
+Work-related injury insurance
+18
+4,932
+833
+(837)
+(9,840)
+157,489
+3,042
+102,265
+9,840
+49
+6
+8,975
+The employee compensation payable includes the salary of employees and marketized temporary and seasonal
+workers, various insurance, housing fund, training expenses and other surcharges.
+174
+PETROCHINA COMPANY LIMITED
+(2) Short-term employee benefits
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+December 31, 2020
+Additions
+Reduction
+December 31, 2021
+Wages, salaries and allowances
+2,821
+Staff welfare
+(102,044)
+2 to 3 years
+749
+5
+(67)
+218
+Total
+143,869
+28,400
+(436)
+(6,835)
+164,998
+25 SHORT-TERM BORROWINGS
+Impawn - RMB
+Guarantee RMB
+Mortgage-RMB
+Unsecured RMB
+Unsecured - USD
+Unsecured - JPY
+(39)
+Unsecured Other
+61
+Provision for impairment of other non-current
+assets
+14
+Provision for impairment of construction in
+progress
+5,526
+3,648
+(563)
+8,611
+Provision for impairment of intangible assets
+Provision for impairment of goodwill
+47
+(4)
+792
+36
+36
+Provision for impairment of right-of-use assets
+8
+8
+263
+December 31, 2021
+December 31, 2020
+105
+27 ACCOUNTS PAYABLE
+The aging of accounts payable are analysed as follows:
+The Group
+December 31, 2021
+December 31, 2020
+Amount
+Percentage of
+total balance %
+Amount
+Percentage of
+total balance %
+Within 1 year
+208,032
+88
+192,416
+1 to 2 years
+11,398
+As of December 31, 2021 and December 31, 2020, notes payable mainly represented commercial acceptance. All
+notes payable are matured within one year.
+26 NOTES PAYABLE
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+PETROCHINA COMPANY LIMITED
+85
+94
+9,013
+10,862
+26,982
+26,542
+2,241
+11,549
+3,316
+634
+40,010
+41,354
+As of December 31, 2021, the above guaranteed RMB borrowings were mainly guaranteed by minority shareholders
+of relevant non-wholly-owned subsidiaries.
+The weighted average interest rate for short-term borrowings as of December 31, 2021 is 0.99% per annum
+(December 31, 2020: 1.17%).
+2021 ANNUAL REPORT 173
+FINANCIAL STATEMENTS PetroChina
+1,490
+Maternity insurance
+58,011
+109
+3
+4
+11,265
+29,188
+2,000
+46,000
+2
+2
+6,626
+6,579
+19,893
+81,769
+The guaranteed borrowings were mainly guaranteed by CNPC and its subsidiaries, and the impawn borrowings
+were mainly impawned by the right to charge for natural gas.
+33 LONG-TERM BORROWINGS
+December 31, 2021
+10,558
+December 31, 2020
+576
+9,687
+Unsecured Other
+Debentures payable due within one year
+Long-term payables due within one year
+Lease liabilities due within one year
+December 31, 2021
+December 31, 2020
+960
+14
+1
+20
+461
+1,290
+5
+3
+4
+16,867
+Unsecured - USD
+Guarantee RMB
+Guarantee Other
+136,200
+110,599
+65,068
+3,553
+3,954
+209,270
+189,328
+Less: Long-term borrowings due within one year (Note 32)
+(11,265)
+(29,188)
+198,005
+160,140
+176
+PETROCHINA COMPANY LIMITED
+89,037
+Unsecured Other
+Guarantee - USD
+Unsecured USD
+785
+Impawn - RMB
+Impawn - USD
+Mortgage RMB
+-
+1,700
+4,009
+3,772
+1,420
+1
+6
+2,073
+1,203
+2,869
+2,284
+1,091
+Unsecured RMB
+Unsecured RMB
+Mortgage - RMB
+Impawn - RMB
+8,920
+(3) Post-employment benefits-defined contribution plans
+Basic pension insurance
+Unemployment insurance
+Annuity
+December 31, 2020
+Additions
+Reduction
+December 31, 2021
+35
+13,630
+1
+480
+(13,622)
+(480)
+43
+52
+1
+(139)
+(136,037)
+8,599
+(109)
+4
+Housing provident funds
+7
+10,185
+(10,186)
+6
+Labour union funds and employee
+education funds
+5,181
+3,182
+(3,090)
+5,273
+Other
+53
+138
+136,358
+10
+6,876
+(6,881)
+10,959
+76,774
+63,724
+2021 ANNUAL REPORT
+175
+FINANCIAL STATEMENTS PetroChina
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+31 OTHER PAYABLES
+As of December 31, 2021, other payables mainly comprised dividends payable, interests payable, deposit, earnest
+money, caution money and insurance payables. Other payables aged over one year amounted to RMB 4,331 (December
+31, 2020: RMB 8,362).
+32 CURRENT PORTION OF NON-CURRENT LIABILITIES
+Long-term borrowings due within one year
+Guarantee - RMB
+Guarantee USD
+Guarantee Other
+16,010
+43,470
+43,803
+3,730
+5
+46
+20,986
+(20,983)
+49
+As of December 31, 2021, employee benefits payable did not contain any balance in arrears.
+30 TAXES PAYABLE
+4
+Value added tax payable
+Consumption tax payable
+Other
+December 31, 2021
+December 31, 2020
+7,046
+5,565
+9,915
+Income tax payable
+(4,183)
+Total
+73,757
+As of December 31,2021, the asset retirement obligations capitalised in the cost of oil and gas properties amounted
+to RMB 114,489(December 31, 2020: RMB 96,657). Related depletion charge for the year ended December 31, 2021
+was RMB 2,944 (2020: RMB 4,766).
+The Group's exploration and production segment determines whether there are any indicators of impairment for
+the oil fields or blocks and performs the impairment tests on those oil fields or blocks with indications of impairment, and
+reports the results to the Group's internal professional team (including exploration and finance expert) for further overall
+assessment and evaluation. The final results of the impairment tests have been submitted to the Group's management
+for review and approval. The Group recorded impairment losses amounting to RMB 19,463 related to oil and gas
+properties under the exploration and production segment for the year ended December 31, 2021 (2020: RMB 13,908)
+due to decline in oil and gas reserves in certain oilfield as well as no further development plans for certain other projects.
+The carrying amount of those impaired oil and gas properties was written down to their respective recoverable amounts,
+which were primarily determined using the discounted cash flow model. The Group referred to the weighted average
+cost of capital of the oil and gas industry when determining discount rate, and made relevant adjustments according to
+specific risks in different countries or regions. In 2021, the after-tax discount rates adopted by most oil fields or blocks of
+the Group ranged from 7.6% to 15.0% (2020: 5.9% to 12.0%) per annum.
+Depletion charged to profit or loss provided on oil and gas properties for the year ended December 31, 2021 was
+RMB 138,237(2020: RMB 135,362). Cost transferred from construction in progress to oil and gas properties was RMB
+160,810(2020: RMB 152,389).
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+FINANCIAL STATEMENTS
+168 PETROCHINA COMPANY LIMITED
+18 CONSTRUCTION IN PROGRESS
+816,788
+Total
+801,069
+15,719
+778,692
+Wells and related facilities
+35,196
+813,888
+Mineral interests
+Transferred
+to fixed
+fund
+year
+of
+interest for current
+expense
+budget
+31, 2021
+Including:
+capitalised
+oil and gas
+Other December compared to
+properties Reduction
+December
+expense Source
+construction Capitalised
+assets or
+interest
+Proportion of
+Project Name Budget 31, 2020 Additions
+Net book value
+(89,037)
+4,183
+49,496
+Total
+Wells and related facilities
+Mineral interests
+Oil and gas properties, net
+(23,165)
+(1,523,635)
+(1,546,800)
+838,149
+60,471
+(1,468,502)
+Total
+59,034
+(129,795)
+(1,452,874)
+Wells and related facilities
+(138,769)
+887,645
+47,246
+858,579
+(19,463)
+(73,757)
+Total
+(57,510)
+3,171
+(1,224)
+(59,457)
+Wells and related facilities
+(31,527)
+1,012
+(18,239)
+(14,300)
+Mineral interests
+Provision for impairment
+905,825
+Guangdong
+Petrochemical
+Integration
+of Refining
+(8,611)
+223,671
+563
+222,215
+(5,526) (3,648)
+Provision for
+impairment
+Less:
+2021 ANNUAL REPORT
+1,008
+1,945
+3,651
+232,282
+(21,738)
+188,549
+(21,738)
+213,192 211,408 (214,313)
+227,741 241,843 (215,564)
+362
+169
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+Buildings
+103,583
+(343)
+2,077
+101,849
+Land
+Cost
+December 31, 2021
+Reduction
+Additions
+December 31, 2020
+Right-of-use assets
+The leases where the Group is a lessee
+19 LEASES
+For the year ended December 31, 2021, the capitalised interest expense amounted to RMB 1,008(2020: RMB 895).
+The average annual interest rates used to determine the capitalised amount in 2021 are 4.19% (2020: 4.19%).
+Self&
+loan
+1,437
+30
+45%
+Ethane Project 1,620
+Self&
+Production by
+Tarim Ethylene
+Self&
+loan
+615
+712
+1,675
+40,580
+(206)
+13,443 27,343
+65,430
+Industry
+and Chemical
+80%
+538
+(1,045)
+205
+2,948
+2,554
+394
+6,494
+Other
+Guangdong
+Jieyang,
+projects in
+its supporting
+year ABS and
+600,000 tons/
+loan
+1
+1
+77%
+30
+57,337
+(8,974)
+Mineral interests
+(24,063)
+Other
+(16,906)
+1,488
+(1,053)
+(17,341)
+(2,818)
+Motor Vehicles
+8,579
+(35,247)
+(443,018)
+Equipment and Machinery
+(114,802)
+3,043
+(469,686)
+(12,228)
+1,584
+Total
+474,325
+22,092
+Other
+5,516
+Motor Vehicles
+303,386
+(25,297)
+Equipment and Machinery
+Buildings
+Fixed assets, net
+(626,691)
+14,694
+(51,346)
+(590,039)
+143,331
+(105,617)
+Buildings
+Accumulated depreciation
+Equipment and Machinery
+258,858
+(6,008)
+15,918
+248,948
+Buildings
+746,404
+Cost
+Reduction
+Additions
+December 31, 2020
+16 FIXED ASSETS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+FINANCIAL STATEMENTS
+December 31, 2021
+43,978
+(12,379)
+778,003
+1,106,039
+(22,449)
+64,124
+1,064,364
+Total
+47,275
+(2,463)
+3,583
+46,155
+Other
+21,903
+(1,599)
+645
+22,857
+Motor Vehicles
+144,056
+308,317
+4,997
+21,978
+As of December 31,2021, Fixed assets with a book value of RMB 823 are used as collateral for long-term
+borrowings of RMB 1,091 (Note 33).
+As of December 31, 2021, the Group's fixed assets under operating leases are mainly equipment and machinery,
+the net book value of which amounted to RMB 1,829(2020: RMB 1,772).
+In 2021, the provision for impairment of the group's fixed assets affecting profit and loss is RMB 3,360(2020: RMB
+1,164), which is mainly related to the assets of refining and chemicals sector (2020: is mainly related to the assets of
+exploration and production sector). After the provision for impairment of these assets is made, the book value is written
+down to the recoverable amount. In 2021, the post-tax discount rate adopted by the group ranged from 7.6% to
+12.0% (2020: 5.9% to 12.0%) per annum.
+Depreciation charged to profit or loss provided on fixed assets for the year ended December 31, 2021 was RMB
+46,399(2020: RMB 59,535). Cost transferred from construction in progress to fixed assets was RMB 54,754(2020: RMB
+52,614).
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+PETROCHINA COMPANY LIMITED
+17 OIL AND GAS PROPERTIES
+FINANCIAL STATEMENTS PetroChina
+2021 ANNUAL REPORT
+418,837
+14,130
+4,912
+415,988
+Total
+167
+Cost
+Mineral interests
+Wells and related facilities
+Accumulated depletion
+2,452,625
+(84,912)
+2,382,214
+70,411
+(2,323)
+(82,589)
+7,610
+173,780
+181,390
+2,356,147
+2,291,023
+65,124
+December 31, 2021
+Reduction
+Additions
+December 31, 2020
+Total
+14,218
+(15,628)
+Other
+Motor Vehicles
+(90)
+Motor Vehicles
+(46,963)
+851
+(2,723)
+(45,091)
+5
+Equipment and Machinery
+183
+(516)
+(5,282)
+Buildings
+Provision for impairment
+479,348
+(5,615)
+(85)
+Other
+(7,874)
+261,354
+138,441
+258,295
+Equipment and Machinery
+138,049
+Buildings
+Net book value
+(60,511)
+1,186
+(3,360)
+(58,337)
+Total
+(7,848)
+147
+(121)
+5,426
+19,463
+5,120
+56,890
+2,807
+4,413
+4,312
+December 31, 2020
+December 31, 2021
+Net book value
+2,873
+Provision for impairment
+Other
+Singapore Petroleum Company
+Petrolneos Trading Limited
+Cost
+21 GOODWILL
+Amortisation charged to profit or loss provided on intangible assets for the year ended December 31, 2021 was
+RMB 5,483(2020: RMB 5,078).
+Total
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+904
+8,023
+Additions
+December 31, 2020
+Total
+Other
+Lease asset improvement expenses
+Catalyst
+875
+22 LONG-TERM PREPAID EXPENSES
+The impairment of goodwill shall be tested in combination with its related asset groups. The recoverable amount of
+all cash-generating units has been determined based on the higher of fair value less costs to sell and value in use. These
+calculations use cash flow projections based on financial budgets prepared by management. The discount rates reflect
+specific risks relating to the cash-generating unit.
+Goodwill primarily relates to the acquisition of Singapore Petroleum Company and Petrolneos Trading Limited,
+subsidiaries in the marketing segment, completed in 2009 and 2011, respectively.
+8,125
+(36)
+(36)
+7,987
+8,161
+For impairment test of the goodwill, the post-tax discount rates ranged 8.5% to 14.7% (2020: 4.9% to 10.5%) were
+used by the management, and no impairment loss was charged for the goodwill for the year ended December 31, 2021
+(2020: nil).
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS PetroChina
+171
+Patents
+14,054
+Franchise
+65,909
+Land use rights
+Intangible assets, net
+781
+(52,475)
+(5,543)
+(48,013)
+Total
+(13,516)
+928
+(1,147)
+1,081
+Other
+6,106
+69,570
+2021 ANNUAL REPORT
+90,587
+86,101
+Net book value
+(792)
+4
+(47)
+(749)
+Provision for impairment
+91,379
+86,850
+Total
+6,369
+983
+14,457
+Reduction
+December 31, 2021
+4,994
+1,776
+(464)
+62
+704
+Bad debts provision for advances to suppliers
+2,683
+(36)
+302
+(211)
+2,674
+Bad debts provision for other receivables
+1,414
+(12)
+(110)
+396
+256
+Provision for declines in the value of inventories
+517
+656
+properties
+Provision for impairment of oil and gas
+60,511
+(1,186)
+3,360
+58,337
+Provision for impairment of fixed assets
+605
+(4)
+443
+166
+Provision for impairment of long-term equity
+investments
+781
+(316)
+(76)
+1,140
+(13,297)
+Bad debts provision for accounts receivable
+4,399
+11,391
+(7,059)
+6,581
+11,869
+4,047
+(3,671)
+23 OTHER NON-CURRENT ASSETS
+2,850
+2,158
+(1,804)
+1,955
+2,007
+5,186
+(1,584)
+4,868
+Other non-current assets consist primarily of long-term accounts receivables, time deposits over one year,
+prepayments for construction project and equipment.
+172
+PETROCHINA COMPANY LIMITED
+(512)
+(321)
+714
+4,518
+Bad debts provision
+31, 2021
+December
+Write-off
+and others
+Reversal
+Additions
+31, 2020
+December
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+FINANCIAL STATEMENTS
+24 PROVISION FOR ASSETS
+Including:
+(5,567)
+Other
+7
+Buildings
+94,882
+Land
+Net book value
+(8)
+(8)
+46,498
+(8)
+(8)
+Buildings
+Provision for impairment
+(27,398)
+3,808
+(11,522)
+(19,684)
+Total
+Total
+Equipment and Machinery
+Other
+Lease liabilities
+Lease Liabilities
+PETROCHINA COMPANY LIMITED
+170
+Depreciation charged to profit or loss provided on right-of-use assets for the year ended December 31, 2021 was
+RMB 11,196(2020: RMB 11,272).
+The Group's use of right assets mainly include leased land, buildings, equipment and machinery. The leases
+underlying assets classified as buildings are mainly the leased gas filling stations, oil storages and office buildings. The
+leases underlying assets classified as equipment and machinery are mainly drilling equipment, production equipment and
+other movable equipment.
+1,475
+139,359
+2,897
+42,465
+92,936
+144,338
+Total
+1,483
+1,061
+(757)
+268
+(313)
+(7,254)
+9,997
+164,022
+Total
+1,818
+(563)
+166,765
+186
+Other
+4,474
+(781)
+2,614
+2,641
+Equipment and Machinery
+2,195
+Accumulated depreciation
+Land
+(6,967)
+(712)
+Other
+(1,577)
+685
+(1,096)
+(1,166)
+Equipment and Machinery
+(14,417)
+2,748
+(6,326)
+(10,839)
+Buildings
+(10,647)
+107
+(3,787)
+Less: Lease liabilities due within one year (Note 32)
+(3,994)
+FINANCIAL STATEMENTS
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+19,885
+(977)
+1,459
+19,403
+Other
+4,977
+Total
+(4)
+4,626
+Patents
+23,702
+(65)
+1,298
+22,469
+355
+134,863
+10,366
+(1,375)
+(156)
+(3,845)
+Patents
+(9,245)
+37
+(867)
+(8,415)
+Franchise
+(25,720)
+109
+(3,373)
+(22,456)
+Land use rights
+Accumulated amortisation
+143,854
+Franchise
+PETROCHINA COMPANY LIMITED
+95,290
+7,254
+20 INTANGIBLE ASSETS
+Over 5 years
+Between 2 to 5 years
+Between 1 to 2 years
+Within 1 year
+Analysis of the undiscounted cash flow of the lease liabilities is as follows:
+December 31, 2021
+122,644
+(6,579)
+(6,626)
+129,223
+129,848
+December 31, 2020
+December 31, 2021
+123,222
+(329)
+December 31, 2020
+11,824
+88,365
+Land use rights
+Cost
+December 31, 2021
+Reduction
+Additions
+12,495
+December 31, 2020
+208,853
+153,967
+154,636
+29,862
+30,541
+10,236
+11,181
+205,889
+FINANCIAL STATEMENTS PetroChina
+9,889
+186 PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS
+Marketing
+725,472
+685,693
+572,754
+550,102
+Natural Gas and Pipeline
+346,880
+341,770
+308,217
+311,528
+Head Office and Other
+300
+789
+493
+296
+405,607
+Intersegment elimination
+572,593
+777,939
+(1,240,363)
+1,875,016
+(1,235,310)
+1,485,062
+The Company
+2021
+2020
+Income
+Cost
+Income
+Cost
+Exploration and Production
+531,690
+422,015
+394,614
+337,664
+Refining and Chemicals
+557,165
+(1,646,471)
+2,005,006
+(1,017,204)
+(794,724)
+9,802
+9,428
+9,634
+9,454
+Non-oil sales in gas stations
+25,148
+23,083
+23,196
+22,360
+20,537
+Other
+27,661
+33,987
+26,826
+31,551
+Sale of materials
+(1,020,795)
+Cost
+Cost
+(792,427)
+Total
+1,365,077
+986,637
+1,053,947
+812,770
+184
+PETROCHINA COMPANY LIMITED
+(c) Income and cost of sales from other operations
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+The Group
+2021
+2020
+Income
+Income
+2,551,738
+Total
+(1,639,119)
+The Company
+2021
+2020
+369,032
+258,520
+472,398
+412,096
+1,300,678
+995,669
+198,608
+149,677
+7,148
+21,838
+19,098
+66,918
+51,526
+Total
+(1,017,204)
+Intersegment elimination
+Non-oil sales in gas stations
+334,933
+2,195
+1,200,722
+732,031
+1,932,753
+2021 ANNUAL REPORT
+183
+FINANCIAL STATEMENTS PetroChina
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+Type of contract
+Type of goods and services
+Crude oil
+Natural gas
+Refined products
+Chemical products
+Pipeline transportation business
+Others
+(796,836)
+1,412,268
+1,096,898
+2,143,071
+2,075,302
+1,473,620
+1,420,966
+Natural Gas and Pipeline
+410,226
+387,041
+362,559
+331,063
+Head Office and Other
+300
+223
+493
+296
+Intersegment elimination
+Marketing
+566,858
+766,358
+698,114
+Revenue from contracts with customers is mainly recognised at a point in time.
+(b) Income and cost of sales from principal operations
+The Group
+2021
+2020
+Income
+Cost
+Total
+Income
+Exploration and Production
+669,537
+490,797
+512,349
+401,189
+Refining and Chemicals
+967,723
+Cost
+1,220,773
+62,611
+58,820
+28,905
+6,913
+6,953
+754
+972
+5,239
+4,457
+1,368
+1,271
+921
+459
+4,604
+12,298
+51,701
+55,315
+31,902
+2021
+2020
+47 FINANCE EXPENSES
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+45 GENERAL AND ADMINISTRATIVE EXPENSES
+Employee compensation costs
+Depreciation, depletion and amortisation
+Lease, packing, warehouse storage expenses
+Safety fund
+Technology service expense
+Other taxes
+Others
+46 RESEARCH AND DEVELOPMENT EXPENSES
+Employee compensation costs
+Depreciation, depletion and amortisation
+Fuel and material consumption
+Others
+2021
+FINANCIAL STATEMENTS PetroChina
+2020
+6,989
+Less: Interest income
+(2,984)
+(3,023)
+Exchange losses
+12,839
+14,279
+Less: Exchange gains
+Others
+(13,377)
+(14,387)
+826
+17,043
+24,304
+907
+48 OTHER INCOME
+(895)
+8,030
+(1,008)
+6,297
+1,478
+1,472
+798
+941
+6,423
+6,344
+16,729
+15,746
+2021
+2020
+Interest expenses
+20,747
+27,423
+Include: Interest expenditure on lease liabilities
+5,419
+Less: Capitalized interest
+185
+2021 ANNUAL REPORT
+71,476
+18,071
+21,725
+15,247
+19,096
+Total
+48,332
+49,762
+43,575
+45,633
+43 TAXES AND SURCHARGES
+2021
+2020
+Consumption tax
+161,623
+145,525
+Other
+Resource tax
+17,632
+20,070
+61,542
+The Company
+2021
+2020
+Income
+Cost
+Income
+Cost
+Sale of materials
+8,423
+7,967
+9,230
+8,905
+Non-oil sales in gas stations
+21,838
+19,098
+23,723
+18,468
+City maintenance and construction tax
+24,105
+22,775
+Depreciation, depletion and amortisation
+15,490
+15,220
+Transportation expenses
+14,101
+15,618
+Lease, packing, warehouse storage expenses
+3,411
+3,463
+Others
+14,188
+14,400
+71,295
+Employee compensation costs
+2020
+2021
+44 SELLING EXPENSES
+16,078
+13,647
+Educational surcharge
+11,660
+9,882
+Urban and township land use tax
+3,572
+66,498
+3,588
+4,655
+178
+Others
+5,353
+3,616
+226,664
+194,904
+Crude oil special gain levy
+281,946
+666,153
+65,878
+92,906
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+At the 14th meeting of the 8th Board, the Board of Directors proposed final dividends attributable to equity holders
+of the Company in respect of 2021 of RMB 0.09622 yuan (inclusive of applicable tax) per share, amounting to a total
+of RMB 17,610 according to the issued 183,021 million shares. The above proposal is subject to the approval of the
+shareholders' meeting and is not recognised as liabilities as at December 31, 2021.
+41 NON-CONTROLLING INTERESTS
+Non-controlling interests attributable to non-controlling interests of subsidiaries:
+CNPC Exploration and Development Company Limited
+KunLun Energy Company Limited
+Percentage
+of shares
+held by non-
+controlling
+interests %
+Profit or loss
+attributable
+to non-
+controlling
+interests
+Dividends
+declared
+to non-
+controlling
+interests
+Balance
+of non-
+controlling
+interests
+50.00
+4,825
+1,478
+79,481
+PETROCHINA COMPANY LIMITED
+45.62
+FINANCIAL STATEMENTS PetroChina
+2021 ANNUAL REPORT
+The Discretionary Surplus Reserves is approved by a resolution of shareholders' general meeting after Board
+of Directors' proposal. The Company may convert its Discretionary Surplus Reserves to make good previous years'
+losses or to increase the capital of the Company upon approval. The Company has not extracted Discretionary Surplus
+Reserves for the year ended December 31, 2021 (2020: None).
+40 UNDISTRIBUTED PROFITS
+Undistributed profits at beginning of the period
+Add: Net profit attributable to equity holders of the Company
+Less: Appropriation to statutory surplus reserves
+Dividends payable to ordinary shares
+Others
+Undistributed profits at end of the period
+For the year ended December 31, 2021
+722,939
+92,161
+(8,413)
+(39,866)
+134
+766,955
+181
+Pursuant to the Company Law of PRC, the Company's Articles of Association and the resolution of Board of
+Directors, the Company is required to transfer 10% of its net profit to a Statutory Surplus Reserves. Appropriation to the
+Statutory Surplus Reserves may be ceased when the fund aggregates to 50% of the Company's registered capital. The
+Statutory Surplus Reserves may be used to make good previous years' losses or to increase the capital of the Company
+upon approval.
+13,821
+45,259
+Cost
+Principal operations (b)
+2,551,738
+Other operations (c)
+62,611
+Total
+2,614,349
+2,005,006
+66,498
+2,071,504
+Including: Revenue from contracts with customers (a)
+2,613,142
+1,875,016
+58,820
+1,933,836
+1,932,753
+1,485,062
+61,542
+1,546,604
+Other revenue
+1,207
+1,083
+Income
+13,108
+Cost
+2020
+PetroChina Sichuan Petrochemical Company Limited
+PetroKazakhstan Inc.
+10.00
+338
+307
+2,503
+33.00
+12
+7
+1,088
+Others
+16,978
+145,309
+42 OPERATING INCOME AND COST OF SALES
+The Group
+2021
+Income
+211,970
+8,413
+203,557
+December 31, 2020
+12,161
+26,654
+11,364
+16,390
+December 31, 2021
+December 31, 2020
+21,099
+21,099
+161,922
+161,922
+183,021
+183,021
+The assets and liabilities injected by CNPC in 1999 had been valued by China Enterprise Appraisal Co., Ltd.. The
+net assets injected by CNPC had been exchanged for 160 billion state-owned shares of the Company with a par value
+of RMB 1.00 yuan per share. The excess of the value of the net assets injected over the par value of the state-owned
+shares had been recorded as capital surplus.
+Pursuant to the approval of CSRC, on April 7, 2000, the Company issued 17,582,418,000 foreign capital stock
+with a par value of RMB 1.00 yuan per share, in which 1,758,242,000 shares were converted from the prior state-owned
+shares of the Company owned by CNPC.
+The above-mentioned foreign capital stock represented by 13,447,897,000 H shares and 41,345,210 ADS (each
+representing 100 H shares), were listed on the Stock Exchange of Hong Kong Limited and the New York Stock Exchange
+Inc. on April 7, 2000 and April 6, 2000, respectively.
+The Company issued an additional 3,196,801,818 new H shares with a par value of RMB 1.00 yuan per share
+on September 1, 2005. CNPC also converted 319,680,182 state-owned shares it held into H shares and sold them
+concurrently with PetroChina's issuance of new H shares.
+December 31, 2021
+The Company issued 4,000,000,000 A shares with a par value of RMB 1.00 yuan per share on October 31, 2007.
+The A shares were listed on the Shanghai Stock Exchange on November 5, 2007.
+H shares
+A shares
+Deferred tax liabilities
+102,670
+25,633
+Other
+87,208
+24,147
+75,204
+16,023
+Depreciation and depletion of assets
+Taxable
+temporary
+differences
+41,656
+177,874
+47,343
+180,006
+Deferred tax assets and liabilities after offset are listed as below:
+Deferred tax assets
+37 SHARE CAPITAL
+Following the issuance of the A shares, all the existing state-owned shares issued before November 5, 2007 held by
+CNPC have been registered with the China Securities Depository and Clearing Corporation Limited as A shares.
+180
+PETROCHINA COMPANY LIMITED
+168
+2,095
+127,222
+168
+(15)
+127,375
+December 31, 2020
+Additions
+Reduction
+December 31, 2021
+203,517
+8,413
+211,930
+40
+40
+1,927
+40,955
+40,955
+84,325
+38 CAPITAL SURPLUS
+Capital premium
+Other capital surplus
+Capital surplus under the old CAS
+Other
+39 SURPLUS RESERVES
+Statutory Surplus Reserves
+The Company
+Discretionary Surplus Reserves
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+December 31, 2020
+Additions
+Reduction
+December 31, 2021
+84,340
+(15)
+FINANCIAL STATEMENTS
+2021
+2020
+Income
+Type of contract
+Type of goods and services
+Exploration
+and
+Production
+Refining
+and
+Chemicals
+Head
+Marketing
+Natural Gas Office and
+and Pipeline
+Other
+Total
+Crude oil
+333,557
+447,384
+780,941
+Natural gas
+Refined products
+118,388
+2020
+173,696
+2,613,142
+397,412
+Geographical Region
+China's mainland
+68,327
+324,776
+832,229
+397,412
+2,670
+1,625,414
+Others
+Total
+47,953
+116,280
+939,775
+987,728
+324,776
+1,772,004
+2,670
+294,297
+586,381
+616,063
+1,220,773
+23,800
+(35,437)
+334,933
+3,515
+115,500
+(1,320) (1,243,597)
+2,195
+1,932,753
+Geographical Region
+China's mainland
+27,028
+281,946
+554,620
+334,933
+2,195
+Others
+Total
+1,300
+(276,503)
+8,254
+(492,667)
+281,946
+92,906
+Total
+822,192
+1,438,255
+Chemical products
+150,296
+30,344
+180,640
+Pipeline transportation
+2,613,142
+business
+52,273
+Non-oil sales in gas stations
+22,360
+22,360
+Others
+Intersegment elimination
+78,631
+(437,670)
+52,273
+2021
+2,670
+1,772,004
+(a) Revenue from contracts with customers
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+2021
+Exploration
+and
+Type of contract
+Production
+Refining
+and
+Chemicals
+Marketing
+Natural Gas
+and Pipeline
+Head
+Office and
+Other
+Total
+Type of goods and services
+Crude oil
+PETROCHINA COMPANY LIMITED
+464,298
+182
+1,141
+Cost
+Income
+Cost
+Principal operations (b)
+Other operations (c)
+1,365,077
+48,332
+Total
+1,413,409
+986,637
+49,762
+1,036,399
+Including: Revenue from contracts with customers (a)
+1,412,268
+1,053,947
+43,575
+1,097,522
+1,096,898
+812,770
+45,633
+858,403
+Other revenue
+624
+685,743
+1,150,041
+Natural gas
+90,539
+Intersegment elimination
+(571,705)
+7,072
+(650,018)
+1,272
+32,208
+3,871
+134,962
+(397,485)
+(19,526)
+(1,201)
+(1,639,935)
+Total
+116,280
+324,776
+Others
+25,148
+3,360
+25,148
+133,148
+344,196
+381,370
+858,714
+Refined products
+759,912
+1,064,890
+397,412
+1,824,802
+207,810
+48,240
+256,050
+Pipeline transportation
+business
+3,360
+Non-oil sales in gas stations
+Chemical products
+2020
+92,798
+FINANCIAL STATEMENTS PetroChina
+10,000
+10,000
+2020 PetroChina Kunlun Gas Company
+Limited first tranche medium-term notes
+- 3 years
+April
+27,2020
+3-year 2.43
+1,000
+137,239
+1,000
+(46,069)
+91,170
+Less: Debentures Payable due within one
+year (Note 32)
+3-year 2.42
+(46,000)
+91,239
+89,170
+178
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+The above-mentioned debentures were issued at the par value, without premium or discount.
+As of December 31, 2021, the above-mentioned debentures which were guaranteed by CNPC and its subsidiaries
+amounted to RMB 8,000 (December 31, 2020: RMB 8,000).
+The fair value of the debentures amounted to RMB 86,176 (December 31, 2020: RMB 132,323). The fair value
+are based on discounted cash flows using an applicable discount rate based upon the prevailing market rates as at the
+balance sheet date of the Group's availability of financial instruments (terms and characteristics similar to the above-
+mentioned debentures payable).
+35 PROVISIONS
+Asset retirement obligations
+(2,000)
+December 31, 2020
+9,2020
+-
+10,000
+10,000
+2019 PetroChina Company Limited third
+tranche medium-term notes - 5 years
+2019 PetroChina Company Limited fourth
+tranche medium-term notes - 5 years
+2019 PetroChina Company Limited fifth
+tranche medium-term notes - 5 years
+2020 PetroChina Company Limited first
+tranche medium-term notes - 3 years
+2020 PetroChina Company Limited
+second tranche medium-term notes
+February
+22,2019
+5-year 3.66
+10,000
+10,000
+February
+22,2019
+5-year 3.66
+3 years
+10,000
+April
+23,2019
+5-year 3.96
+10,000
+10,000
+April
+9,2020
+3-year 2.42
+10,000
+10,000
+April
+10,000
+5-year 3.45
+Additions
+December 31, 2021
+Carry forward of losses
+1,892
+7,569
+24,646
+215,844
+Other
+14,709
+81,534
+8,995
+50,603
+27,163
+6,072
+136,720
+313,355
+139,644
+43,308
+December 31, 2021
+After five years
+Between two and five years
+Between one and two years
+The maturities of long-term borrowings at the dates indicated are analysed as follows:
+As of December 31, 2021, the above-mentioned guaranteed borrowings were mainly guaranteed by CNPC and its
+subsidiaries. The RMB impawn borrowings were mainly impawned by the right to charge for natural gas. The US dollar
+impawn borrowings were impawned by the deposit of RMB 3,286 (December 31, 2020: RMB 2,586). And the secured
+liabilities are secured by fixed assets with a book value of RMB 823; Constructions in progress with a book value of RMB
+283 and intangible assets with a book value of RMB 54 (December 31, 2020: fixed assets with a book value of RMB 1,303).
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+At 31 December 2021, certain subsidiaries of the Company did not recognise deferred tax asset of deductible tax
+losses carried forward of RMB 109,752 (2020: RMB 99,997), of which RMB 13,866 (2020: RMB 10,973) was incurred
+for the year ended 31 December 2021, because it was not probable that the related tax benefit will be realised. These
+deductible tax losses carried forward of RMB 525, RMB 400, RMB 585, RMB 3,669 and RMB 104,573 will expire in
+2022, 2023, 2024, 2025, 2026 and thereafter, respectively.
+42,317
+Reduction
+1,258
+1,405
+114,819
+20,769
+(6,183)
+129,405
+Asset retirement obligations are related to oil and gas properties.
+36 DEFERRED TAX ASSETS AND LIABILITIES
+Deferred tax assets and liabilities before offset are listed as below:
+(a) Deferred tax assets
+December 31, 2021
+December 31, 2020
+Deferred tax
+7,413
+assets
+Deductible
+Deferred tax
+temporary
+assets
+differences
+Impairment, depreciation and depletion of
+assets
+9,157
+40,204
+7,418
+40,836
+Wages and welfare
+Deductible
+temporary
+differences
+2021 ANNUAL REPORT
+24,2019
+January
+15-year
+5.04
+2,000
+2,000
+March
+- 10 years
+15,2013
+10-year 4.88
+4,000
+4,000
+Kunlun Energy Company Limited priority
+notes 10 years
+November
+22,2012
+May
+10-year 3.75
+3,239
+(69)
+3,170
+2016 PetroChina Company Limited
+Corporate Debentures first tranche
+January
+-
+5 years
+19,2016
+5-year 3.03
+13,2015
+8,800
+2,000
+4.90
+45,051
+100,746
+14,343
+160,140
+The weighted average interest rate for long-term borrowings as of December 31, 2021 is 2.62% (December 31,
+2020: 2.88%).
+The fair value of long-term borrowings (including long-term borrowings due within one year) amounted to RMB
+204,752 (December 31, 2020: RMB 188,071). The fair value are based on discounted cash flows using applicable
+discount rates based upon the prevailing market rates as at balance sheet date of the Group's availability of financial
+instruments (terms and characteristics similar to the above-mentioned borrowings).
+2021 ANNUAL REPORT
+177
+FINANCIAL STATEMENTS PetroChina
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+2,000
+34 DEBENTURES PAYABLE
+Term of interest December
+Debentures' Name
+2012 PetroChina Company Limited
+Corporate Debentures first tranche
+10 years
+-
+2012 PetroChina Company Limited
+Corporate Debentures first tranche
+15 years
+-
+2013 PetroChina Company Limited
+Corporate Debentures first tranche
+November
+22,2012
+Issue date Debentures rate% 31, 2020 Additions Reduction
+December
+31, 2021
+10-year
+Annual
+5 years
+(8,800)
+Corporate Debentures first tranche
+9,500
+(9,500)
+2016 PetroChina Company Limited
+Corporate Debentures third tranche
+March
+-
+10 years
+24,2016
+10-year 3.60
+2,000
+2,000
+2016 PetroChina Company Limited first
+tranche medium-term notes
+5-year 3.08
+May
+5-year 3.45
+15,000
+(15,000)
+2019 PetroChina Company Limited first
+tranche medium-term notes - 5 years
+January
+24,2019
+5-year 3.45
+10,000
+10,000
+2019 PetroChina Company Limited
+second tranche medium-term notes
+11,2016
+2016 PetroChina Company Limited
+24,2016
+-
+January
+-
+10 years
+19,2016
+10-year 3.50
+4,700
+4,700
+2016 PetroChina Company Limited
+Corporate Debentures second tranche
+March
+-
+5 years
+5 years
+3,2016
+3.15 12,700
+(12,700)
+-
+2016 PetroChina Company Limited
+Corporate Debentures second tranche
+10 years
+March
+3,2016
+10-year 3.70
+2,300
+2,300
+2016 PetroChina Company Limited
+Corporate Debentures third tranche
+March
+5-year
+179
+December 31, 2020
+PETROCHINA COMPANY LIMITED
+15,053
+198,005
+Refund of import value-added tax, relating to the import of
+natural gas
+8,606
+3,570
+Refund of value-added tax, relating to the change from
+business tax to value-added tax
+153
+1,976
+5,492
+4,343
+14,251
+Others
+Deferred tax
+liabilities
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+December 31, 2021
+December 31, 2020
+Taxable
+(b) Deferred tax liabilities
+temporary
+liabilities
+differences
+Deferred tax
+1,230,428
+27,719
+Net profit attributable to equity holders of
+the Company
+Unit: RMB million
+Fourth Quarter
+2021
+734,008
+2021
+683,760
+First Quarter Second Quarter Third Quarter
+2021
+2021
+551,923
+644,658
+Operating income
+Items
+(2) Key financial indicators by quarter
+4.0%
+the end of this year
+of 2019
+1,215,421
+1,263,815
+Equity attributable to equity holders
+of the Company
+0.6%
+2,488,400
+2,502,533
+Total assets
+25,317
+of the preceding year to As at the end
+2,733,190
+22,086
+114,722
+Net profit after deducting non-recurring
+profit/loss items attributable to equity
+holders of the Company
+Gains on disposal of other subsidiaries
+Gain on Pipeline restructuring
+Net gains on disposal of associates and joint ventures
+Reversal of provisions for bad debts against receivables
+Government grants recognised in the current period income statement
+Losses on disposal of non-current assets
+Non-recurring profit/loss items
+Unit: RMB million
+(3) Non-recurring profit/loss items
+SUMMARY OF FINANCIAL DATA AND FINANCIAL INDICATORS
+007
+2021 ANNUAL REPORT
+Changes from the end
+110,713
+117,834
+(1,800)
+Net cash flows (used in)/ generated from
+operating activities
+31,287
+23,013
+17,220
+28,011
+17,039
+2020
+3.7
+Items
+341,469
+Net cash flows from operating
+activities
+(11,991)
+99,531
+non-recurring profit/loss items
+attributable to equity holders of
+the Company
+Net profit/(loss) after deducting
+45,677
+73,159
+19,002
+92,161
+318,575
+Net profit attributable to equity
+holders of the Company
+117,397
+64,783
+182,180
+Operating profit
+35.2%
+year
+2020
+1,933,836
+2,614,349
+Operating income
+Changes from the
+preceding year to this
+For the year
+2019
+2,516,810
+115,520
+2021
+111,522
+7.2%
+the end of
+As at
+As at
+the end of
+0.25
+0.40
+0.25
+0.40
+1,830.21
+Other non-operating income and expenses
+5.8 percentage points
+53,485
+1.6
+0.10
+0.10
+0.50
+0.50
+Diluted earnings per share (RMB)
+Basic earnings per share (RMB)
+1,830.21
+1,830.21
+Total share capital at the end of the
+period (hundred million share)
+Weighted average returns on net
+assets (%)
+359,610
+7.4
+Tax impact of non-recurring profit/loss items
+Impact of non-controlling interests
+1,226
+For the year 2021
+CHANGES IN SHAREHOLDINGS AND INFORMATION ON SHAREHOLDERS
+2021 ANNUAL REPORT 009
+The number of shareholders of the Company as at February 28, 2022 was 634, 195, consisting of 628,238 holders of
+A shares and 5,957 registered holders of H shares (including 142 registered holders of the ADSs).
+The number of shareholders of the Company as at December 31, 2021 was 618,008, consisting of 612,015 holders
+of A shares and 5,993 registered holders of H shares (including 142 holders of the ADSs). The minimum public float
+requirements of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the "Listing
+Rules") and Stock Listing Rules of the Shanghai Stock Exchange (the "SSE Listing Rules") are satisfied.
+3. Number of Shareholders and Shareholdings
+During the reporting period, no shares for employees of the Company were in issue.
+(2) Shares held by Employees
+For the issuances of bonds, please refer to the section "Relevant Information on Bonds" of this annual report.
+11.53
+21,098,900,000
+In the reporting period, there was no issue of shares.
+(1) Issue of securities in the reporting period
+2. Issue and Listing of Securities
+11.53
+21,098,900,000
+4. Others
+overseas
+3. Shares listed
+domestically
+currencies and listed
+in non-RMB
+(1) Shareholdings of the top ten shareholders as at the end of the reporting period
+Percentage of
+Nature of shareholding
+Name of shareholders
+892,090,100 (S)
+SUMMARY OF FINANCIAL DATA AND FINANCIAL INDICATORS
+PetroChina
+2. Key Financial Data Prepared under CAS
+(1) Key financial data and financial indicators
+Unit: RMB million
+146,882,339,136(1)
+80.25
+legal person
+CNPC
+2. Shares traded
+State-owned
+Number
+of shares
+pledged or
+Unit: Shares
+period with selling
+reporting of shares
+Number
+Increase and
+decrease
+during the
+(+,) restrictions
+Number of
+shares held
+(%)
+shareholders
+subject to
+lock-ups
+Total
+88.47
+88.47
+266
+1,176
+3. Differences between CAS and IFRS
+910
+equity instruments
+recognized in other
+Balance at the end
+of the reporting Changes in the
+period reporting period
+Balance at the
+beginning of the
+reporting period
+Investments
+Items
+(4) Items to which fair value measurement is applied
+(7,370)
+(7,913)
+(683)
+(4,186)
+3,575
+18,320
+(4)
+321
+837
+(19,546)
+Unit: RMB million
+Amount affecting
+the profit of the
+reporting period
+17
+The Group's consolidated net profit for the year under IFRS and CAS were RMB114,696 million
+and RMB114,687 million respectively, with a difference of RMB9 million; the consolidated shareholders'
+equity as at the end of the year under IFRS and CAS were RMB1,408,869 million and RMB1,409,124
+million respectively, with a difference of RMB255 million. These differences under the different accounting
+standards were primarily due to the valuation for assets other than fixed assets and oil and gas properties
+in 1999.
+161,922,077,818
+ordinary shares
+1. RMB-denominated
+100.00
+183,020,977,818
+100.00
+selling restrictions 183,020,977,818
+Shares without
+(%)
+Numbers of Percentage
+shares
+- 161,922,077,818
+from
+Sub-
+Reserves Others total
+Post-movement
+Increase/decrease (+/-)
+Conversion
+Pre-movement
+Unit: Shares
+1. Changes in Shareholdings
+CHANGES IN SHAREHOLDINGS AND
+INFORMATION ON SHAREHOLDERS
+PetroChina
+CHANGES IN SHAREHOLDINGS AND INFORMATION ON SHAREHOLDERS
+008 PETROCHINA COMPANY LIMITED
+During the restructuring in 1999, a valuation was carried out in 1999 for assets and liabilities injected
+by CNPC. Valuation results on assets other than fixed assets and oil and gas properties were not recognised
+in the financial statements prepared under IFRS.
+Numbers of Percentage New Bonus
+shares
+(%) Issue Issue
+Shareholder/Approved
+Items
+CNPC-CSC-17
+CNPC
+1
+Ranking Name of shareholders
+(2) Shareholdings of top ten shareholders of shares without selling restrictions as at the end of the reporting period
+PetroChina
+CHANGES IN SHAREHOLDINGS AND INFORMATION ON SHAREHOLDERS
+010 PETROCHINA COMPANY LIMITED
+(4) Hong Kong Securities Clearing Company Limited is a wholly-owned subsidiary of Hong Kong Exchanges and Clearing Limited
+and acts as the nominee on behalf of investors of Hong Kong Stock Exchange to hold the A shares of the Company listed on
+Shanghai Stock Exchange.
+(3) 291,518,000 H shares were indirectly held by CNPC through Fairy King Investments Limited, an overseas wholly-owned
+subsidiary of CNPC, representing 0.16% of the total share capital of the Company. These shares were held in the name of
+HKSCC Nominees Limited.
+(2) HKSCC Nominees Limited is a wholly-owned subsidiary of the Hong Kong Exchanges and Clearing Limited and it acts as a
+nominee on behalf of other corporate or individual shareholders to hold the H shares of the Company.
+Notes: (1) Such figure excludes the H shares indirectly held by CNPC through Fairy King Investments Limited, an overseas wholly-owned
+subsidiary of CNPC.
+2
+0
+100,000,087
+0.05
+Domestic
+natural person
+Huang Changfu
+0
+0
+182,729,700 -37,270,300
+0.10
+legal person
+State-owned
+Xin'an No.1 Single Asset
+Management Plan
+0
+HKSCC Nominees Limited
+3
+CNPC-CSC-17 CNPC E2 Pledge and Trust Special Account
+560,000,000
+China Metallurgical Group Corporation
+7
+A Shares
+840,233,256
+Hong Kong Securities Clearing Company
+6
+CO
+A Shares
+1,020,165,128
+China Securities Finance Corporation Limited
+5
+A Shares
+2,051,488,354
+CNPC-CSC-17 CNPC EB Pledge and Trust Special Account
+4
+A Shares
+3,819,965,034
+H Shares
+20,899,426,821
+A Shares
+Types of
+shares
+Unit: Shares
+146,882,339,136(1)
+Number of shares held
+Bosera Fund Ansteel Group
+Corporation -Bosera Fund
+A Shares
+0
+201,695,000 -4,414,200
+legal person
+Corporation Limited
+State-owned
+China Securities Finance
+2,051,488,354
+1.12
+legal person
+0
+0
+Overseas legal
+HKSCC Nominees Limited (2)
+0.56
+person
+20,899,426,821 (3) -2,670,879
+0
+0
+State-owned
+CNPC E2 Pledge and Trust
+Special Account
+State-owned
+legal person
+2.09
+3,819,965,034
+-6,036
+0 3,819,965,034
+11.42
+1,020,165,128 -118,973,576
+-249
+0 2,051,488,354
+0.11
+legal person
+Management Ltd.
+State-owned
+Central Huijin Asset
+0
+0
+0
+560,000,000
+0.31
+legal person
+Corporation
+State-owned
+China Metallurgical Group
+0
+0
+840,233,256 261,831,212
+0.46
+person
+Limited (4)
+Overseas legal
+Clearing Company
+Hong Kong Securities
+0
+0
+0
+8
+Central Huijin Asset Management Ltd.
+201,695,000
+PetroChina
+investment corporation and state-owned enterprise. Its legal representative is Mr. Dai Houliang. CNPC is an integrated
+energy corporation with businesses covering oil and gas exploration and development, refining and petrochemical, oil
+product marketing, oil and gas storage and transportation, oil trading, engineering and technical services and petroleum
+equipment manufacturing.
+In 2021, CNPC was committed to building itself into a globally first-class integrated energy corporation with truly
+international standards. It earnestly observed its requirements for high-quality development, fully implement its strategies,
+namely, innovation, resources, markets, internationalisation, green and low carbon. CNPC made great efforts on the
+prevention and control of the epidemic and the resumption of work and production, optimised the production and
+operation, deepened reform and innovation, strengthened risk prevention and control, and further enhanced the quality
+and profitability. As a result of these efforts, CNPC delivered a steady production and operation under control.
+(2) Except for CNPC, no other legal person holds 10% or more of the shares in the Company (excluding HKSCC
+Nominees Limited).
+(3) Ultimate controller
+State-owned Assets Supervision and Administration Commission of the State Council is the ultimate controller of the
+Company.
+(4) Ownership and controlling relationship between the Company and the ultimate controller
+State-owned Assets Supervision and Administration
+Commission of the State Council
+100%
+CHANGES IN SHAREHOLDINGS AND INFORMATION ON SHAREHOLDERS
+CNPC
+PetroChina Company Limited
+Note: Such figure includes the 291,518,000 H shares held by CNPC through its overseas wholly-owned subsidiary, Fairy King Investments
+Limited.
+2021 ANNUAL REPORT
+013
+Dai Houliang Chairman
+CHAIRMAN'S REPORT
+Dear Shareholders,
+I am pleased to submit to you the annual report of the Company for the year ended December 31,
+2021 for your review.
+Despite the continued economic recovery throughout the world during the year of 2021, there was
+divergence in the development trend of different economies due to the impact from the fluctuating cases in
+the prevention and control of the Coronavirus Disease 2019 (the "COVID-19") and the differences between
+economic policies. There was a stable recovery of the demand in the international crude oil market. The
+international crude oil prices continued to rebound. The macro-economy of China has been improving
+and developing on a continued basis. The gross domestic product (GDP) of the year in China increased
+by 8.1% year-on-year. The demand in refined oil market gradually recovered, basically back to the pre-
+COVID-19 levels. The demand in the natural gas market continued to grow at a rapid pace.
+Taking advantage of the rise in the oil price in the international market, the continued and stable
+recovery of China's economy, vigorous demand in oil and gas market and other favourable opportunities,
+the Group earnestly implemented requirements on high-quality development, coordinated the advancement
+of, among various other work, production and operation, green and low-carbon transformation, reform
+014 PETROCHINA COMPANY LIMITED
+80.41% (Note)
+012 PETROCHINA COMPANY LIMITED
+The controlling shareholder of the Company is CNPC which was established in July 1998. CNPC is a petroleum and
+petrochemical conglomerate that was formed in the wake of the restructuring launched by the State Council to restructure
+the predecessor of CNPC, China National Petroleum Company (T). CNPC is also a state-authorised
+(1) Controlling shareholder
+4.23
+For the year For the year
+2021
+0.49
+345,286,695 (LP)
+Lending Agent
+1.64
+0.19
+1,238,578,552 (L)
+Interest of Corporation
+5.87
+0.68
+BlackRock, Inc. (3)
+H Shares
+Controlled by the Substantial
+188,000(S)
+Shareholder
+0.00
+0.00
+(L) Long position (S) Short position (LP) Lending pool
+Notes: (1) 291,518,000 H shares (long position) were held by Fairy King Investments Limited, an overseas wholly-owned subsidiary of
+CNPC. CNPC is deemed to be interested in the H shares held by Fairy King Investments Limited.
+(2) The Bank of New York Mellon Corporation, through various subsidiaries, had an interest in the H shares of the Company, of
+which 1,267,777,801 H shares (long position) and 892,090, 100 H shares (short position) were held in its capacity as interest
+of corporation controlled by the substantial shareholder, and 345,286,695 H shares (lending pool) were held in its capacity as
+approved lending agent.
+(3) Blackrock, Inc., through various subsidiaries, had an interest in the H shares of the Company, of which 1,238,578,552 H shares
+(long position) and 188,000 H shares (short position) were held in its capacity as interest of corporation controlled by the
+substantial shareholder.
+As at December 31, 2021, so far as the Directors are aware, save as disclosed above, no person (other than a
+Director, Supervisor or senior management of the Company) had an interest in the shares of the Company according to
+the register of interests in shares and short positions kept by the Company pursuant to Section 336 of the Securities and
+Futures Ordinance.
+4. Information on Controlling Shareholder and the Ultimate Controller
+There was no change in the controlling shareholder or the ultimate controller during the reporting period.
+CHAIRMAN'S REPORT
+PetroChina
+and innovation, quality and profitability enhancement, safety and environmental protection and epidemic prevention. The
+operation of the oil and gas business, the two industry chains, was stable with profits. The management of ESG issues
+continued to improve. The operating results in 2021 were the best among the last 7 years. In 2021, the Group achieved
+a revenue of RMB2,614,349 million, representing an increase of 35.2% as compared with last year, and the net profit
+attributable to equity holders of the Company was RMB92, 170 million, representing an increase by RMB73, 164 million as
+compared with last year. The structure of asset and liability was further optimized, and the financial position of the Group
+continued to be stable and healthy. The Group maintained robust cash flow, with free cash flow seeing a year-on-year
+increase of 13.8%.
+In 2022, the global economy is expected to continue to recover but at a lower growth pace. Affected by the changing
+situation in terms of the supply of and demand for oil and gas, geopolitical turmoil and other factors, international oil and
+gas prices are expected to remain at high-end, while fluctuating in a wider range and more frequently. The fundamentals for
+the long-term improvement of Chinese economy will remain unchanged, and the natural gas market under the low-carbon
+strategy will maintain a relatively rapid growth. Facing various opportunities and challenges, the Group will adhere to new
+development concept, actively integrate itself into the new development landscape and implement the requirements for
+high-quality development by vigorously carrying out the five development strategies of innovation, resources, market,
+internationalization, green and low-carbon. The Group will endeavour to develop its principal businesses, strengthen
+enterprise management, carry out reform and innovation, improve quality and enhance profitability, promote green
+transformation, digital transformation and risk prevention, and strive to create value for shareholders.
+Percentage
+Unit: Shares
+Percentage of such
+shares in the same
+class of the issued
+share capital (%)
+Capacity
+Number of shares
+Nature
+of share
+holding
+A Shares
+Name of
+shareholders
+CHANGES IN SHAREHOLDINGS AND INFORMATION ON SHAREHOLDERS
+011
+2021 ANNUAL REPORT
+As at December 31, 2021, so far as the Directors are aware, persons other than a Director, Supervisor or senior
+management of the Company who had interests or short positions in the shares or underlying shares of the Company which
+are discloseable under Divisions 2 and 3 of Part XV of the Securities and Futures Ordinance are as follows:
+(3) Disclosure of Substantial Shareholders under the Securities and Futures Ordinance of Hong Kong
+Statement on related parties or parties acting in concert among the above-mentioned shareholders: Except for the
+fact that HKSCC Nominees Limited and Hong Kong Securities Clearing Company Limited are wholly-owned subsidiaries
+of Hong Kong Exchanges and Clearing Limited, the Company is not aware of any connection among or between the above
+top ten shareholders or that they are parties acting in concert as provided for in the Measures for the Administration of
+Acquisitions by Listed Companies.
+Description on the voting rights entrusted by or to, or waived by the above-mentioned shareholders: the Company is
+not aware of any voting rights entrusted by or to, or waived by the above-mentioned shareholders.
+Description on the special repurchase accounts under the above-mentioned shareholders: there is no special
+repurchase account among the above-mentioned shareholders.
+Note: (1) Such figure excludes the H shares indirectly held by CNPC through Fairy King Investments Limited, an overseas wholly-owned
+subsidiary of CNPC, which H shares were held in the name of HKSCC Nominees Limited.
+A Shares
+100,000,087
+Huang Changfu
+10
+A Shares
+182,729,700
+Bosera Fund Ansteel Group Corporation - Bosera Fund Xin'an
+No.1 Single Asset Management Plan
+9
+A Shares
+of total share
+capital (%)
+CNPC-CSC-17
+146,882,339,136 (L)
+90.71
+In terms of Exploration and Production Business, the Group will adhere to high-profitability exploration, continue to
+stabilize oil and increase gas, increase risk exploration efforts in key areas, and strengthen the concentrated exploration
+activities in reserve-increasing areas such as Ordos Mesozoic conventional oil, Songliao Gulong shale oil, Tarim Bozi-Dabei
+and the northern slope of the central Sichuan paleo-uplift conventional gas. We also focus on exploration in Shawan New
+Formation of Mahu Lake Junggar, Sichuan Qixia-Maokou and other strategic replacement areas, and strive to achieve
+strategic discoveries and breakthroughs. The Group will strive to improve the reserve replacement rate. It will adhere to
+profitable development, strive to control the decline rate, improve the recovery rate, focus on optimizing the production
+capacity structure and layout, and build capacity on a centralized and profitability-focused basis, and construct in a high-
+quality manner for key capacity projects such as Mahu, Fuman, Hetao, and Sulige, striving to realise the steady increase
+of crude oil production and rapid increase of natural gas production. The Group will promote the construction of shale oil
+demonstration zones such as Qingcheng, Jimsar, and Gulong with high standards, and make every effort to organise the
+large-scale and stable production of shale gas in southern Sichuan. In 2022, we plan to reach the crude oil output of 898.6
+million barrels and the marketable natural gas output of 4,625.1 billion cubic feet, with a total oil and natural gas equivalent
+output of 1,669.7 million barrels.
+In terms of Refining and Chemicals Business, the Group will keep up with the change in market demands, continue
+to promote transformation and upgrading, coordinate to optimize resource allocation and operation organisation, flexibly
+control the diesel-to-gasoline ratio, promote the production increase and mutual supply of raw material for chemical,
+and strive to maintain high-load operation of chemical plants. The Group will increase the production and sales of high-
+profitability refined products, specialty products and marketable chemical products with high added value. The Group
+will strengthen production control and benchmarking management, keep operating on a low inventory basis, organise
+2021 ANNUAL REPORT 015
+CHAIRMAN'S REPORT
+enterprise maintenance to avoid peak production, strive to realise that the equipment can operate on a stable, long lasting
+and optimal basis, and the primary technical and economic indicators will continue to improve. The Group will actively
+promote the new material business, build high-end carbon material devices, deepen joint-venture-based cooperation
+in polycarbon and polyoxymethylene, and strive to increase the output of new materials. The Group will improve the
+marketing network for chemicals, actively expand overseas markets, promote the “basic + high-end" brand building, make
+good use of the "PetroChina e-Chemical" platform, and promote the increase in both sales volume and profit. The Group
+will focus on the construction of key projects. We will complete and put into operation Guangdong Petrochemical, start the
+construction of Jilin and Guangxi ethylene projects, accelerate the progress of the Tarim Phase II ethylene project and the
+preliminary work of the four ethylene transformation projects in Sichuan, Daqing, Fushun and Lanzhou. In 2022, we plan to
+reach the processing volume of crude oil of 1,269.4 million barrels.
+In terms of Marketing Business, the Group will keep focusing on market changes, strengthen the efforts of marketing,
+expand the sales and improve the profitability. The Group will strengthen oil price forecast and closely monitor oil-
+consumption industries. The Group will strive to increase market share by keeping an eye on various new demand and
+enhancing customer development efforts. It will develop differentiated marketing strategies by industry, region and product,
+systematically promote the renovation and upgrading of existing gas stations, accelerate the improvement of integrated
+operation mechanisms such as "retail + wholesale and direct sales" and "sales + service", and strive to increase sales. The
+Group will flexibly use asset-light methods such as joint ventures, franchises, and leases extension to develop refuelling
+stations for oil and gas, control the development of conventional stations, especially outside-district and high-priced
+stations, and speed up the construction of new energy stations such as photovoltaic stations, charging and swapping
+stations, and hydrogen fuelling stations (comprehensive energy service stations). The Group will promote the construction
+of gas station management 3.0 system and create a digital and intelligent marketing and service platform. It will innovate
+the business model of non-oil business, speed up the construction of e-commerce platform, strengthen the marketing of
+convenience stores and cross-border marketing, and strive to improve the sales revenue and gross profit of a single store.
+The Group will also carefully organise international trade, increase the development of high-end and high-profitability
+markets and cross-region markets, and improve the export profitability of refined oil and chemical products.
+In terms of Natural Gas and Pipeline Business, the Group will optimize the resources and markets, and continue to
+maintain the advantage position in competition. The Group will selectively develop high-quality projects, deploy potential
+projects in advance and strengthen market development in different provinces and optimize the distribution of resources,
+so as to increase the share in high-profitability market and the share in the end-customer market. The Group will vigorously
+implement refined marketing, classify customers on a precise basis, improve customer service system, optimize resource
+structure according to the principle of profitability, reduce procurement costs, optimize sales flow, pipeline transportation
+routes and facility utilization, and allocate more resources to high-profitability market and new industrial areas, chemical
+parks, new districts in cities and other areas. The Group will improve the market trading system, promote market reform of
+natural gas prices, flexibly optimize price strategies and online transactions, and promote the decrease in marketing costs
+and the increase in resource value. The Group will conduct market changes scientifically, explore a specialized contract
+mechanism including both long-term and short-term contracts and improve marketing management.
+016 PETROCHINA COMPANY LIMITED
+H Shares
+Controlled by the Substantial
+0.69
+6.01
+Interest of Corporation
+York Mellon
+Corporation (2)
+The Bank of New
+1,267,777,801(L)
+0.16
+1.38
+Shareholder
+0
+291,518,000 (L) (1) Controlled by the Substantial
+H Shares
+Interest of Corporation
+CNPC
+80.25
+Beneficial Owner
+CNPC EB Pledge and Trust
+Special Account
+(199)
+49 INVESTMENT INCOME
+1,239
+815
+1,239
+Damage or scrapping of non-current assets
+Other
+20,637
+5,674
+20,637
+4,121
+5,906
+4,121
+Extraordinary loss
+26,969
+26,969
+54 TAXATION
+Income taxes
+Deferred taxes
+188
+PETROCHINA COMPANY LIMITED
+2021
+2020
+33,822
+14,922
+12,823
+9,685
+626
+626
+2021
+2020
+837
+1,347
+2,146
+2,762
+2,983
+4,109
+Amount recognised in
+non-recurring profit or
+loss in 2021
+837
+398
+2,146
+Amount recognised in
+non-recurring profit or
+loss in 2021
+2021
+2020
+Fines
+346
+30
+346
+Donation
+2,983
+(b) Non-operating expenses
+7,666
+22,588
+4,639
+6,262
+43,507
+22,588
+55 EARNINGS PER SHARE
+Basic and diluted earnings per share for the year ended December 31, 2021 and 2020 have been computed by
+dividing profit attributable to owners of the Company by the 183,021 million shares issued and outstanding during the
+period.
+There are no potential dilutive ordinary shares, and the diluted earnings per share are equal to the basic earnings
+per share.
+56 OTHER COMPREHENSIVE INCOME
+Other comprehensive income attributable to
+equity holders of the Company
+December
+31, 2020
+Tax effect of temporary differences and losses not recognised
+as deferred tax assets
+Taxation
+Additions
+December
+31, 2021
+Items that will not be reclassified to profit or loss
+Including: Changes in fair value of investments in
+other equity instruments
+301
+135
+(56)
+380
+Items that may be reclassified to profit or loss
+Including: Other comprehensive income
+recognized under equity method
+195
+Reduction
+43,507
+5,455
+Tax effect of expenses not deductible for tax purposes
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+The tax on the Group's profit before taxation differs from the theoretical amount that would arise using the corporate
+income tax rate in the PRC applicable to the Group as follows:
+2021
+2020
+Profit before taxation
+158,194
+56,069
+Tax calculated at a tax rate of 25%
+39,549
+15,789
+14,017
+(256)
+256
+Effect of income taxes from international operations different
+from taxes at the PRC statutory tax rate
+2,692
+1,522
+Effect of preferential tax rate
+Tax effect of income not subject to tax
+(8,603)
+(10,303)
+(1,312)
+(3,612)
+Tax return true-up
+Other
+Government grants
+(a) Non-operating income
+15,082
+25,664
+Share of profit of associates and joint ventures
+10,604
+5,314
+Gains on disposal of subsidiaries
+335
+83,425
+Gains on investments in other equity instruments
+15
+Dividends declared by subsidiaries
+15
+8
+26,044
+114,412
+50 CREDIT LOSSES
+Accounts receivable
+Other receivables
+Others
+51 ASSET IMPAIRMENT LOSSES
+2021
+2020
+Other investment income/(loss)
+286
+2020
+The Company
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+The Group
+2021
+2020
+Share of profit of associates and joint ventures
+13,267
+3,533
+Gain on Pipeline restructuring
+18,320
+2021
+46,946
+3,575
+1,242
+Gains on investments in other equity instruments
+17
+25
+Other investment income
+210
+99
+35,389
+51,845
+Gains on disposal of other subsidiaries
+350
+45
+22
+2020
+Amount recognised in
+non-recurring profit or
+loss in 2021
+Gains from disposal of fixed assets and oil
+and gas properties
+685
+276
+685
+Losses from disposal of construction in
+progress
+(25)
+(1)
+(25)
+2021
+Gains from disposal of intangible assets
+131
+146
+Gains from disposal of other long-term
+assets
+285
+1,017
+285
+1,091
+1,423
+1,091
+53 NON-OPERATING INCOME AND EXPENSES
+146
+52 GAINS FROM ASSET DISPOSALS
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+PETROCHINA COMPANY LIMITED
+353
+341
+2021
+2020
+Impairment losses for bad debts provision
+62
+2
+Impairment losses for declines in the value of inventories
+580
+8,151
+Impairment losses for fixed assets and oil and gas properties
+22,823
+15,072
+Impairment losses for construction in progress
+3,648
+295
+Impairment losses for other non-current assets
+498
+27,611
+23,520
+2021 ANNUAL REPORT
+187
+FINANCIAL STATEMENTS PetroChina
+458
+462
+2021 ANNUAL REPORT
+translation of foreign currency
+customers
+Revenue from external
+(1,243,597)
+(1,320)
+(35,437)
+(276,503)
+3,547 3,177,433
+370,771
+1,497,533
+774,775
+(492,667)
+(437,670)
+93,137
+Less: Intersegment revenue
+Revenue
+Total
+Head
+Natural
+Gas and Office and
+Pipeline
+Other
+Marketing
+Refining
+and
+Chemicals
+Exploration
+and
+Production
+(b) Segment information as of and for the year ended December 31, 2020 is as follows:
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+FINANCIAL STATEMENTS
+1,093,409
+530,807
+282,108
+1,221,030
+335,334
+19,551
+Asset impairment losses
+214,760
+1,825
+19,478
+17,829
+23,906
+151,722
+Depreciation, depletion and
+amortisation
+64,783
+Operating profit
+1,307
+expenses
+Unallocated income and
+63,476
+2,227 1,933,836
+(17,283) (1,870,360)
+(14,647)
+30,132
+826
+(426)
+47,591
+Segment result
+(96,718)
+(981,540)
+(401,901)
+Segment expenses (i)
+(804,244)
+192 PETROCHINA COMPANY LIMITED
+Total liabilities
+balances (ii)
+178,259
+Capital expenditures
+353
+3
+28
+482
+28
+(188)
+Credit losses
+27,611
+214
+1,728
+4,999
+20,670
+Asset impairment losses
+204,743
+1,848
+5,111
+18,889
+23,784
+155,111
+Depreciation, depletion and
+amortisation
+182,180
+Operating profit
+(8,527)
+54,487
+252
+10,982
+700
+103,428
+Elimination of intersegment
+Other liabilities
+1,794,225
+566,602
+128,490
+349,609
+199,159
+550,365
+2,502,533
+Segment liabilities
+Total assets
+(1,889,352)
+17,014
+Elimination of intersegment
+balances (ii)
+Other assets
+4,374,871
+1,604,801
+334,545
+539,966
+459,930
+1,435,629
+Segment assets
+December 31, 2021
+251,178
+6,750
+3,709
+8
+23,520
+(c) Price risk
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+194
+The Group has no significant interest rate risk on interest-bearing assets. The Group's exposure to interest rate risk
+arises from its borrowings(including debentures payable). The Group's borrowings at floating rates expose the Group to
+cash flow interest rate risk and its borrowings at fixed rates expose the Group to fair value interest rate risk. However, the
+exposure to interest rate risk is not material to the Group. A detailed analysis of the Group's borrowings and debentures
+payable, together with their respective interest rates and maturity dates, is included in Note 33 and 34.
+(b) Interest rate risk
+Additionally, the Group operates internationally and foreign exchange risk arises from future acquisitions and
+commercial transactions, recognised assets and liabilities and net investments in foreign operations. Certain entities in
+the Group might use currency derivatives to manage such foreign exchange risk.
+The Group conducts its domestic business primarily in RMB, but maintains a portion of its assets in other currencies
+to pay for imported crude oil, natural gas, imported equipment and other materials and to meet foreign currency financial
+liabilities. The Group is exposed to currency risks arising from fluctuations in various foreign currency exchange rates
+against the RMB. The RMB is not a freely convertible currency and is regulated by the PRC government. Limitations on
+foreign exchange transactions imposed by the PRC government could cause future exchange rates to vary significantly
+from current or historical exchange rates.
+(a) Foreign exchange risk
+Market risk is the possibility that changes in foreign exchange rates, interest rates and the prices of crude oil and
+gas products will adversely affect the value of assets, liabilities and expected future cash flows.
+(1) Market risk
+The Group's activities expose it to a variety of financial risks, including market risk, credit risk and liquidity risk.
+1. Financial risk
+60 FINANCIAL RISK MANAGEMENT
+(i) Non-current assets mainly include non-current assets other than financial instruments and deferred tax assets.
+1,980,240
+2,003,885
+190,785
+165,117
+1,789,455
+1,838,768
+December 31, 2020
+December 31, 2021
+721,015
+1,933,836
+The Group is engaged in a wide range of oil and gas products-related activities. Prices of oil and gas products are
+affected by a wide range of global and domestic factors which are beyond the control of the Group. The fluctuations in
+such prices may have favourable or unfavourable impacts on the Group.
+1,212,821
+The Group uses derivative financial instruments, including commodity futures, commodity swaps and commodity
+options, to hedge some price risks efficiently.
+As at 31 December 2021, it is estimated that a general increase/decrease of USD 10 per barrel in basic price of
+derivative financial instruments, with all other variables held constant, would impact the fair value of derivative financial
+instruments, which would increase/decrease the Group's profit for the year by approximately RMB 2,104 (2020:
+decrease/increase RMB 2,578), there is no effect on the Group's other reserves (2020: Nil). This sensitivity analysis
+has been determined assuming that the change in prices had occurred at the balance sheet date and the change was
+applied to the Group's derivative financial instruments at that date with exposure to commodity price risk.
+196 PETROCHINA COMPANY LIMITED
+The Group's investments in derivative financial instruments, receivables financing and other equity instruments are
+measured at fair value on the balance sheet date. The fair value of derivative financial instruments are mainly categorised
+into Level 1 and Level 2 of the fair value hierarchy, which are based on the unadjusted quoted prices in active markets for
+identical assets or liabilities as inputs used in the valuation techniques, or the inputs other than quoted prices included
+within Level 1 that are observable either directly or indirectly. Receivables financing are mainly categorised into Level 3 of
+the fair value hierarchy, which are based on that Receivables financing are mainly short-term bills of acceptance issued by
+banks, their fair values approximate the face values of the bills. The investments in other equity instruments are measured
+at fair value at the end of the reporting period. The investments in other equity instruments are mainly categorised into
+Level 1 of the fair value hierarchy, which are based on the unadjusted quoted prices in active markets for identical assets
+or liabilities as inputs used in the valuation techniques.
+The carrying amounts of the following financial assets and financial liabilities approximate their fair value as all of
+them are short-term in nature: cash at bank and on hand, accounts receivable, other receivables, receivable finiancing,
+accounts payable, other payables and short-term borrowings. The fair values of fixed rate long-term borrowings are
+likely to be different from their respective carrying amounts. Analysis of the fair values and carrying amounts of long-term
+borrowings and debentures payable are presented in Note 33 and Note 34, respectively.
+The methods and assumptions applied in determining the fair value of each class of financial assets and financial
+liabilities of the Group at December 31, 2021 and 2020 are disclosed in the respective accounting policies.
+3. Fair value estimation
+The Group monitors capital on the basis of the gearing ratio which is calculated as interest-bearing borrowings/
+(interest-bearing borrowings + total equity), interest-bearing borrowings include short-term and long-term borrowings,
+debentures payable and ultra short-term financing bond. The gearing ratio at December 31, 2021 is 19.46% (December
+31, 2020: 21.30%).
+The Group's objectives when managing capital are to safeguard its ability to continue as a going concern, optimise
+returns for equity holders and to minimise its cost of capital. In meeting its objectives of managing capital, the Group may
+issue new shares, adjust its debt levels or the mix between short-term and long-term borrowings.
+2. Capital management
+Analysis of the Group's long-term borrowings, debentures payable and lease liabilities based on the remaining
+period at the balance sheet date to the contractual maturity dates are presented in Note 33, 34 and 19.
+material.
+Given the low level of gearing and continued access to funding, the Group believes that its liquidity risk is not
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS PetroChina
+2021 ANNUAL REPORT 195
+In managing its liquidity risk, the Group has access to funding at market rates through equity and debt markets,
+including using undrawn committed borrowing facilities to meet foreseeable borrowing requirements.
+liabilities.
+Liquidity risk is the risk that the Group will encounter difficulty in meeting obligations associated with financial
+(3) Liquidity risk
+The Group has no significant concentration of credit risk.
+The carrying amounts of cash at bank and on hand, accounts receivable, other receivables and receivables
+financing included in the consolidated balance sheet represent the Group's maximum exposure to credit risk. No other
+financial assets carry a significant exposure to credit risk.
+The Group performs ongoing assessment of the credit quality of its customers, and sets appropriate credit limits
+taking into account the financial position and past history of defaults of customers. The aging analysis of accounts
+receivable and related provision for bad debts are presented in Note 8.
+A substantial portion of the Group's cash at bank and on hand are placed with the major state-owned banks and
+financial institutions in China and management believes that the credit risk is low.
+Credit risk arises from cash at bank and on hand and credit exposure to customers with outstanding receivable
+balances.
+(2) Credit risk
+As at 31 December 2021, the Group had certain commodity contracts of crude oil, refined oil products and
+chemical products designated as hedges. As at 31 December 2021, the fair value of such derivative hedging financial
+instruments is derivative financial assets of RMB 3,913 (2020: RMB 1,411) and derivative financial liabilities of RMB 3,881
+(2020: RMB 3,709).
+expenses
+987,733
+2,614,349
+2020
+Total assets
+balances (ii)
+Elimination of intersegment
+17,361
+Other assets
+4,452,367
+1,660,460
+356,082
+508,232
+433,364
+1,494,229
+Segment assets
+December 31, 2020
+246,493
+626
+341
+110
+21,143
+16,294
+21,810
+186,620
+Capital expenditures
+171
+42
+18
+Credit losses
+Segment liabilities
+1,626,616
+Other liabilities
+186,332
+2021
+Other
+China's mainland
+Non-current assets (i)
+Other
+China's mainland
+Revenue from external customers
+(2) Geographical information
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS PetroChina
+193
+2021 ANNUAL REPORT
+(ii) Elimination of intersegment balances represents elimination of intersegment accounts and investments.
+(i) Segment expenses include cost of sales, taxes and surcharges, selling expenses, general and administrative expenses, research
+and development expenses, other income.
+1,121,515
+(890,708)
+Total liabilities
+balances (ii)
+Elimination of intersegment
+80,114
+(1,981,328)
+2,488,400
+1,932,109
+573,340
+192,456
+321,460
+658,521
+Translation differences arising from
+Unallocated income and
+2,693 2,614,349
+(17,411) (2,423,642)
+(13,543)
+11,196
+Depreciation and depletion of right-of-use assets
+116,450
+124,072
+178,648
+184,636
+Depreciation and depletion of fixed asset and oil and gas properties
+143
+905
+341
+13,110
+11,272
+6,761
+27,611
+353
+Credit losses
+Add: Asset impairment losses
+62,745
+84,133
+33,481
+114,687
+Net profit
+2020
+2021
+2020
+23,520
+6,278
+6,630
+Amortisation of intangible assets
+Safety fund reserve
+8,456
+8,515
+8,934
+12,557
+Capitalised exploratory costs charged to expense
+1,416
+16,515
+5,674
+20,637
+Damage or scrapping of fixed assets and oil and gas properties
+(1,302)
+(931)
+(1,423)
+(1,091)
+Gains on disposal of fixed assets, oil and gas properties, intangible
+assets and other long-term assets
+2,652
+2,844
+3,513
+3,428
+Amortisation of long-term prepaid expenses
+4,130
+4,394
+5,078
+5,483
+The Company
+The Group
+2021
+(a) Reconciliation from the net profit to the cash flows from operating activities
+58 NOTES TO CONSOLIDATED AND COMPANY CASH FLOWS
+Less: Changes in inventories of finished goods and work in
+progress
+1,933,836
+2,614,349
+Operating income
+2020
+2021
+Expenses are analysed by nature:
+57 SUPPLEMENT TO INCOME STATEMENT
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS PetroChina
+189
+(34,737)
+(3,569)
+960
+(32,128)
+Total
+(43)
+(43)
+Others
+(35,532)
+(3,314)
+630
+(32,848)
+financial statements
+(11,078)
+(1,750) (1,505)
+(33,454)
+(1,758,941)
+64,783
+182,180
+(203,614)
+(254,920)
+Operating profit
+Other expenses
+(24,304)
+(17,043)
+Finance expenses
+(3,362)
+(2,645)
+Lease expenses
+(23,520)
+(27,611)
+Assets impairment losses
+(341)
+(353)
+Loss of credit losses
+(198,511)
+(204,743)
+Depreciation, depletion and amortisation expenses
+(147,604)
+(154,835)
+Employee benefits expenses
+(1,234,343)
+Raw materials and consumables used
+121
+(1,805)
+Finance expenses
+Head
+Office and
+Natural
+Gas and
+Pipeline
+Marketing
+Refining
+and
+Chemicals
+Exploration
+and
+Production
+(a) Segment information as of and for the year ended December 31, 2021 is as follows:
+(1) Operating segments
+The accounting policies of the operating segments are the same as those described in Note 4 - "Principal
+Accounting Policies and Accounting Estimates".
+The Head Office and Other segment relates to cash management and financing activities, the corporate center,
+research and development, and other business services supporting the other operating business segments of the Group.
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS PetroChina
+191
+2021 ANNUAL REPORT
+The Natural Gas and Pipeline segment is engaged in the transportation and sale of natural gas.
+The Marketing segment is engaged in the marketing of refined products and non-oil products, and trading business.
+The Refining and Chemicals segment is engaged in the refining of crude oil and petroleum products, production and
+marketing of primary petrochemical products, and derivative petrochemical products and other chemical products.
+The Exploration and Production segment is engaged in the exploration, development, transportation, production
+and marketing of crude oil and natural gas.
+The Group is principally engaged in a broad range of petroleum related products, services and activities. The
+Group's operating segments comprise: Exploration and Production, Refining and Chemicals, Marketing, and Natural
+Gas and Pipeline. On the basis of these operating segments, the management of the Company assesses the segmental
+operating results and allocates resources. Sales between operating segments are conducted principally at market prices.
+Additionally, the Group has presented geographical information based on entities located in regions with similar risk
+profile.
+59 SEGMENT REPORTING
+40,787
+31,955
+118,631
+136,789
+(2,000)
+Other
+(3,550)
+Total
+688,334
+23,597
+15,864
+56,697
+108,092
+Segment result
+(102,802)
+(1,496,597)
+(356,129)
+(450,703)
+Segment expenses (i)
+397,496
+1,772,577
+324,954
+116,629
+customers
+Revenue from external
+(1,201) (1,639,935)
+(19,526)
+(397,485)
+3,894 4,254,284
+417,022
+2,170,062
+974,972
+(650,018)
+(571,705)
+Less: Intersegment revenue
+Revenue
+190,707
+(27,319)
+Less: Time deposits with maturities over 3 months
+Cash and cash equivalents at the end of the period
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+FINANCIAL STATEMENTS
+(c) Cash and cash equivalents
+Add: Cash equivalents at the end of the period
+Less: Cash equivalents at the beginning of the period
+Increase /(decrease) in cash and cash equivalents
+Less: Cash at the beginning of the period
+Cash at the end of the period
+(b) Net increase/(decrease) in cash and cash equivalents
+PETROCHINA COMPANY LIMITED
+190
+20,871
+191,550
+554
+12,714
+39,272
+19,926
+23,505 14,972
+(51,845) (26,044) (114,412)
+7,666
+9,911
+43,645 (18,223)
+(8,265) 14,751 (2,348)
+(3,463) 13,320
+8,895
+240,770
+318,575
+341,469
+Net cash flows from operating activities
+(Decrease) / Increase in operating payables
+(Increase) / Decrease in operating receivables
+(15,889)
+9,685
+17,043
+(35,389)
+(Increase) / Decrease in inventories
+Changes in deferred taxation
+Investment income
+The Group
+2021
+(26,747)
+The Company
+2021
+42,787
+35,505
+145,950
+163,536
+Cash at bank and on hand
+December
+31, 2020
+31, 2021
+December
+December
+31, 2020
+December
+31, 2021
+The Company
+The Group
+36,151
+(8,832)
+32,222
+18,158
+(4,636)
+(40,787)
+(86,409)
+(118,631)
+40,787
+31,955
+118,631
+136,789
+2020
+2020
+(372,918)
+(4,186)
+T: +852 2289 8888, F: +852 2810 9888, www.pwchk.com
+Associate
+Associate
+Associate
+Associate
+Joint venture
+Joint venture
+Joint venture
+Fellow subsidiary of CNPC
+Fellow subsidiary of CNPC
+Fellow subsidiary of CNPC
+Fellow subsidiary of CNPC
+Fellow subsidiary of CNPC
+Fellow subsidiary of CNPC
+CNPC Transportation Co., Ltd.
+Fellow subsidiary of CNPC
+CNPC Material Company Co., Ltd.
+Fellow subsidiary of CNPC
+China National Oil and Gas Exploration and Development Corporation Co., Ltd.
+Fellow subsidiary of CNPC
+China National United Oil Co., Ltd.
+Fellow subsidiary of CNPC
+Fellow subsidiary of CNPC
+CNPC Shared Operation Co. LTD
+(4) Summary of significant related party transactions
+(a) Related party transactions with CNPC and its subsidiaries:
+The Company and CNPC entered into a new Comprehensive Products and Services Agreement on August 27,
+2020 for a period of three years effective from January 1, 2021. The Comprehensive Products and Services Agreement
+provides for a range of products and services which may be required and requested by either party. The products and
+services to be provided by CNPC and its fellow subsidiaries to the Group under the Comprehensive Products and
+Services Agreement include construction and technical services, production services, supply of material services, social
+services, ancillary services and financial services. The products and services required and requested by either party are
+provided in accordance with (1) government-prescribed prices; or (2) where there is no government-prescribed price,
+with reference to relevant market prices; or (3) where neither (1) nor (2) is applicable, then actual cost incurred or the
+agreed contractual prices are used.
+CNPC Oriental Geophysical Exploration Co., Ltd.
+CNPC Chuanqing Drilling Engineering Co., Ltd.
+Daqing Petroleum Administrative Bureau Co., Ltd.
+Liaohe Petroleum Exploration Bureau Co., Ltd.
+China Petroleum Pipeline Bureau Co., Ltd.
+CNPC Bohai Drilling Engineering Co., Ltd.
+Trans-Asia Gas Pipeline Co., Ltd.
+China Marine Bunker (PetroChina) Co., Ltd.
+Mangistau Investment B.V.
+December 31, 2021
+December 31, 2020
+Equity interest %
+Voting rights %
+Equity interest %
+Voting rights %
+China National Petroleum
+Corporation
+80.41
+80.41
+80.41
+80.41
+2021 ANNUAL REPORT 199
+(2) Subsidiaries
+198
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+(3) Nature of related parties that are not controlled by the Company
+Names of related parties
+China Oil & Gas Piping Network Corporation
+Relationship with the Company
+China Petroleum Finance Co., Ltd.
+CNPC Captive Insurance Co., Ltd.
+China National Aviation Fuel Group Limited
+Details about subsidiaries and related information are disclosed in Note 6(1).
+Oil and gas exploration and development,
+refining and petrochemical, oil product
+marketing, oil and gas storage and
+transportation, oil trading, construction and
+technical services and petroleum equipment
+manufacturing etc.
+FINANCIAL STATEMENTS PetroChina
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+1,649
+1,350
+27,802
+29,059
+Interest income
+(7)
+270
+381
+Interest expense
+(8)
+3,490
+7,165
+Other financial service expense
+(9)
+1,388
+886
+Rental and other expenses paid to CNPC and its fellow subsidiaries
+Purchases of assets from CNPC and its subsidiaries
+(10)
+6,797
+8,294
+(11)
+1,051
+767
+1,791
+1,965
+(4)
+110,078
+On August 25,2011, based on the Land Use Rights Leasing Contract signed for a period of 50 years from 2000,
+the Company and CNPC entered into a supplemental agreement to the Land Use Rights Leasing Contract which took
+effect on January 1, 2012. The expiry date of the supplemental agreement is the same as the Land Use Rights Leasing
+Contract, which is in 2050. The Company and CNPC may adjust area and rental payable for the leased land parcels every
+three years taking into consideration of production and operations of the Company and the prevailing market price. On
+August 27, 2020, the Company and CNPC each issued a confirmation letter to the Land Use Rights Leasing Contract,
+which adjusted the rental payable and the area for the leased land parcels with effect from January 1, 2021. The
+Company agreed to rent from CNPC and its fellow subsidiaries parcels of land with an aggregate area of approximately
+1,142 million square metres with annual rental payable (exclusive of tax and government charges) approximately RMB
+5,673 based on the area of leased land parcels and the current market conditions. Apart from the annual rental payable
+and are for the leased parcels, the other terms in the Land Use Rights Leasing Contract and supplemental agreement
+remained.
+On August 24, 2017, the Company entered into a new Buildings Leasing Contract with CNPC, which took effect
+on January 1, 2018 for a period of 20 years. The Company and CNPC may adjust the area of buildings leased and the
+rental fees every three years as appropriate by reference to the production and operations of the Company and the
+prevailing market prices, but the adjusted rental shall not exceed the comparable fair market prices. On August 27,
+2020, the Company and CNPC issued a confirmation letter to the Buildings Leasing Contract, which adjusted the annual
+rental payable and the area for the leased which took effect on January 1, 2021. Buildings covering an aggregate area of
+1,287,486 square meters were leased at annual rental payable approximately RMB 713 in accordance with the confirmed
+rental area and the current property market conditions. Apart from the annual rental payable and area of the leased
+building, the other terms in the Building Leasing Contract remains unchanged.
+200
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+Notes
+2021
+2020
+PETROCHINA COMPANY LIMITED
+Sales of goods and services rendered to CNPC and its subsidiaries
+Purchase of goods and services from CNPC and its subsidiaries:
+69,058
+63,623
+Fees paid for construction and technical services
+Fees for production services
+Social services charges
+Ancillary services charges
+Material supply services
+N O D C
+162,773
+140,241
+129,264
+(1)
+Notes:
+Principal activities
+Dai Houliang
+1,176
+4,246
+9,064
+As of December 31, 2021, financial liabilities continuing to be measured at fair value are listed in three levels as
+follows:
+Financial liabilities
+Derivative financial liabilities-
+Derivative financial liabilities
+Level 1
+RMB
+Level 2
+Level 3
+Total
+RMB
+RMB
+RMB
+726
+3,881
+As of December 31, 2020, financial assets continuing to be measured at fair value are listed in three levels as
+follows:
+Financial assets
+Derivative financial assets-
+Derivative financial assets
+Level 1
+RMB
+Level 2
+Level 3
+271
+3,975
+3,975
+3,913
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+As of December 31, 2021, financial assets continuing to be measured at fair value are listed in three levels as
+follows:
+Financial assets
+Derivative financial assets-
+Derivative financial assets
+Receivables financing-
+Receivables financing
+Investments in other equity instruments―
+other equity instruments
+Total
+Total
+Level 2
+Level 3
+Total
+RMB
+RMB
+RMB
+RMB
+2,625
+1,288
+905
+3,530
+1,288
+Level 1
+(b) Equity interest and voting rights of parent company
+RMB
+RMB
+Level 3
+Total
+RMB
+RMB
+RMB
+2,813
+896
+3,709
+The Group uses discounted cash flow model with inputted interest rate and commodity index, which were
+influenced by historical fluctuation and the probability of market fluctuation, to evaluate the fair value of the bills receivable
+classified as Level 3 financial assets.
+61 RELATED PARTIES AND RELATED PARTY TRANSACTIONS
+(1) Parent Company
+(a) General information of parent company
+CNPC, the immediate parent of the Company, is a limited liability company directly controlled by the PRC
+government.
+Type of Legal
+Entity
+Place of
+incorporation
+Legal
+representative
+China National
+Limited liability
+Petroleum
+Corporation
+company
+(wholly state-owned)
+PRC
+Level 2
+Level 1
+RMB
+Derivative financial liabilities
+Derivative financial liabilities-
+238
+1,173
+1,411
+Receivables financing―
+Receivables financing
+8,076
+8,076
+Investments in other equity instruments―
+other equity instruments
+653
+257
+RMB
+910
+891
+1,173
+8,333
+10,397
+2021 ANNUAL REPORT
+197
+FINANCIAL STATEMENTS PetroChina
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+As of December 31, 2020, financial liabilities continuing to be measured at fair value are listed in three levels as
+follows:
+Financial liabilities
+Total
+(1) Primarily crude oil, natural gas, refined products, chemical products and the supply of water, electricity, gas, heat,
+measurement, quality inspection, etc.
+3,155
+(3) Production services comprise the repair of machinery and equipment, supply of water, electricity and gas, provision of services
+such as communications, transportation, fire fighting, asset leasing, environmental protection and sanitation, maintenance of
+roads, manufacture of replacement parts and machinery, etc.
+According to the current policy, estimated annual payments for the next five years are as follows:
+Within one year
+Between one and two years
+Between two and three years
+Between three and four years
+Between four and five years
+204 PETROCHINA COMPANY LIMITED
+December 31, 2021
+December 31, 2020
+500
+800
+500
+800
+500
+800
+500
+800
+500
+800
+FINANCIAL STATEMENTS SUPPLEMENTARY INFORMATION
+1 NON-RECURRING PROFIT/LOSS ITEMS
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+SUPPLEMENTARY INFORMATION FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+2021
+The Company is obligated to make annual payments with respect to its exploration and production licenses to the
+Ministry of Natural Resources. Payments incurred were RMB 744 for the year ended December 31, 2021 (2020: RMB
+700).
+(2) Exploration and production licenses
+These capital commitments are transactions mainly with CNPC and its fellow subsidiaries.
+At December 31, 2021, the Group's capital commitments contracted but not provided for, mainly relating to
+property, plant and equipment, were RMB 882 (December 31, 2020: RMB 714).
+21
+As of December 31, 2021, the payables to related parties represented 31% (December 31, 2020: 33%) of total
+payables.
+(8) Key management personnel compensation
+Key management personnel compensation
+2021
+RMB'000
+2020
+RMB'000
+16,711
+17,936
+62 CONTINGENT LIABILITIES
+(1) Bank and other guarantees
+At December 31, 2021 and 2020, the Group did not guarantee related parties or third parties any significant
+borrowings or others.
+2020
+(2) Environmental liabilities
+As of December 31,2021, the amounts of asset retirement obligations which have already been reflected in the
+consolidated financial statements relating to environmental liability were RMB 129,405 (Note 35).
+2021 ANNUAL REPORT 203
+FINANCIAL STATEMENTS PetroChina
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+(3) Legal contingencies
+During the reporting period, the Group has complied with domestic and overseas laws and regulatory requirements.
+Notwithstanding certain insignificant lawsuits as well as other proceedings outstanding of the group, management
+believes that any resulting liabilities will not have a material adverse effect on the financial position of the Group.
+(4) Group insurance
+The Group has insurance coverage for certain assets that are subject to significant operating risks, third-party liability
+insurance against claims relating to personal injury, property and environmental damages that result from accidents, and
+employer liabilities insurance. The potential effect on the financial position of the Group of any liabilities resulting from
+future uninsured incidents cannot be estimated by the Group at present.
+63 COMMITMENTS
+(1) Capital commitments
+The PRC has enacted comprehensive environmental laws and regulations that affect the operation of the oil and
+gas industry. Management believes that there are no probable liabilities under existing legislation, except for the amounts
+which have already been reflected in the consolidated financial statements, which may have a material adverse effect on
+the financial position of the Group.
+3,214
+Losses on disposal of non-current assets
+(4,251)
+During the Restructuring in 1999, a valuation was carried out in 1999 for assets and liabilities injected by CNPC.
+Valuation results other than fixed assets and oil and gas properties were not recognised in the financial statements
+prepared under IFRS.
+2021 ANNUAL REPORT
+205
+pwc
+羅兵咸永道
+INDEPENDENT AUDITOR'S REPORT
+TO THE SHAREHOLDERS OF PETROCHINA COMPANY LIMITED
+(incorporated in the People's Republic of China with limited liability)
+Opinion
+What we have audited
+The consolidated financial statements of PetroChina Company Limited (the "Company") and its subsidiaries (the “Group”),
+which are set out on pages 213 to 277, comprise:
+•
+the consolidated statement of financial position as at December 31, 2021;
+•
+the consolidated statement of comprehensive income for the year then ended;
+• the consolidated statement of changes in equity for the year then ended;
+• the consolidated cash flow statement for the year then ended; and
+•
+the notes to the consolidated financial statements, which include significant accounting policies and other explanatory
+information.
+Our opinion
+In our opinion, the consolidated financial statements give a true and fair view of the consolidated financial position of
+the Group as at December 31, 2021, and of its consolidated financial performance and its consolidated cash flows for
+the year then ended in accordance with International Financial Reporting Standards ("IFRSS") and have been properly
+prepared in compliance with the disclosure requirements of the Hong Kong Companies Ordinance.
+206
+PricewaterhouseCoopers, 22/F, Prince's Building, Central, Hong Kong
+(2) Construction and technical services comprise geophysical survey, drilling, well cementing, logging, well testing, oil testing,
+oilfield construction, refineries and chemical plants construction, engineering design and supervision, repair of equipment, etc.
+2 SIGNIFICANT DIFFERENCES BETWEEN IFRS AND CAS
+30,993
+(7,370)
+(35)
+Government grants recognised in the income statement
+837
+1,347
+Reversal of provisions for bad debts against receivables
+321
+95
+Net gains arising from the disposal of associates and joint ventures
+(4)
+(5)
+Gain on Pipeline restructuring
+18,320
+(19,546)
+46,946
+3,575
+1,242
+Other non-operating income and expenses
+(4,387)
+(683)
+40,987
+Tax impact of non-recurring profit/loss items
+Impact of non-controlling interests
+Total
+1,226
+(9,959)
+(7,913)
+Gains on disposal of other subsidiaries
+2,930
+The consolidated net profit for the year under IFRS and CAS were RMB 114,696 and RMB 114,687, respectively,
+with a difference of RMB 9; the consolidated shareholders' equity for the year under IFRS and CAS were RMB 1,408,869
+and RMB 1,409,124, respectively, with a difference of RMB 255. These differences under the different accounting
+standards were primarily due to the revaluation for assets other than fixed assets and oil and gas properties revalued in
+1999.
+207
+760
+1,169
+9,475
+9,729
+243
+41
+20,688
+72,420
+19,554
+19,785
+(5) Commissioned loans
+The Company with its subsidiaries, the Group with CNPC and its subsidiaries, commissioned CP Finance and other
+financial institutions to provide loans to each other, charging interest in accordance with the prevailing interest rates.
+Loans between the Company and its subsidiaries have been eliminated in the consolidated financial statements. As of
+December 31, 2021, the eliminated commissioned loans include the loans provided by the Company to its subsidiaries
+amounted to RMB 150(December 31, 2020: RMB 655) and the loans provided to the Company by its subsidiaries
+amounted to RMB 18,306(December 31, 2020: RMB 19,185).
+(6) Guarantees
+CNPC and its subsidiaries provided guarantees of part of loans and debentures for the Group, see Note 32, Note
+33 and Note 34.
+(7) Receivables and payables with related parties
+(a) Receivables from related parties
+December 31, 2021
+December 31, 2020
+CNPC and its subsidiaries
+Accounts receivable
+5,832
+7,814
+Receivables financing
+1,850
+20,264
+27,540
+19,302
+16,824
+(4) Social services comprise mainly security service, education, hospitals, preschool, etc.
+(5) Ancillary services comprise mainly property management and provision of training centres, guesthouses, canteens, public
+shower rooms, etc.
+32
+(6) Material supply services comprise mainly purchase of materials, quality control, storage of materials and delivery of materials,
+etc.
+(7) The bank deposits in CNPC and its fellow subsidiaries as of December 31, 2021 were RMB 36,489(December 31, 2020: RMB
+40,377).
+(8) The loans from CNPC and its fellow subsidiaries including long-term borrowings, long-term borrowings due within one year
+and short-term borrowings as of December 31, 2021 were RMB 133,800(December 31, 2020: RMB 96,298).
+(9) Other financial service expense primarily refers to expense of insurance and other services.
+(10) Rental and other expenses paid to CNPC and its subsidiaries refer to: 1) Rental was calculated and paid in accordance with
+the Building and Land Use Rights leasing contract between the Group and CNPC. 2) Rents and other payments (including all
+rents, leasing service fees and prices for exercising purchase options) were paid according to other lease agreements entered
+in to by the Group and CNPC and its fellow subsidiaries.
+(11) Purchases of assets principally represent the purchases of manufacturing equipment, office equipment and transportation
+equipment.
+2021 ANNUAL REPORT 201
+FINANCIAL STATEMENTS PetroChina
+Advances to suppliers
+PETROCHINA COMPANY LIMITED
+(b) Related party transactions with associates and joint ventures:
+(a) Sales of goods
+- Crude Oil
+- Refined products
+- Chemical products
+- Natural Gas
+(b) Sales of services
+(c) Purchases of goods
+(d) Purchases of services
+2021
+2020
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+5,285
+The transactions between the Group and its associates and joint ventures are conducted at government-prescribed
+prices or market prices.
+Other receivables
+(b) Payables to related parties
+December 31, 2021
+December 31, 2020
+CNPC and its subsidiaries
+Notes payable
+Accounts payable
+348
+992
+44,183
+48,967
+Other payables
+As of December 31, 2021, the receivables from related parties represented 35% (December 31, 2020: 42%) of total
+receivables.
+2,746
+Contract liabilities
+2,671
+Lease liabilities (including lease liabilities due within one year)
+101,453
+99,725
+Associates and joint ventures
+Accounts payable
+2,042
+Contract liabilities
+11,497
+Other payables
+11,159
+As of December 31, 2021, the provisions for bad debts of the receivables from related parties amounted to RMB
+505(December 31, 2020: RMB 5).
+581
+FINANCIAL STATEMENTS
+4,380
+Other non-current assets
+7,343
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+2,551
+8,670
+Associates and joint ventures
+Accounts receivable
+842
+Advances to suppliers
+248
+314
+Other receivables
+1,568
+10,096
+8,353
+Other non-current assets
+7,245
+202
+10,946
+PETROCHINA COMPANY LIMITED
+Other current assets
+7,926
+6,581
+8,064
+32
+1,452,091
+Time deposits with maturities over one year
+11,364
+12,161
+9,119
+21
+66,344
+18
+209,786
+208,606
+20
+TOTAL NON-CURRENT ASSETS
+250,603
+902
+1,168
+67,494
+2,021,424
+128,539
+CURRENT ASSETS
+8,076
+Time deposits with maturities over three months but within one
+year
+3,975
+1,459,296
+265,785
+26,747
+25
+109,262
+112,820
+2,001,359
+24
+56,659
+23
+143,848
+2222
+Financial assets at fair value through other comprehensive income
+Prepayments and other current assets
+Accounts receivable
+Inventories
+52,325
+17
+0.10
+67 228
+BASIC AND DILUTED EARNINGS PER SHARE ATTRIBUTABLE TO OWNERS
+OF THE COMPANY (RMB)
+22,355
+110,195
+7,721
+20,634
+14,634
+89,561
+33,485
+14
+114,696
+22,526
+19,006
+92,170
+13
+27,319
+Non-controlling interests
+TOTAL COMPREHENSIVE INCOME FOR THE YEAR ATTRIBUTABLE TO:
+Owners of the Company
+Non-controlling interests
+14,479
+0.50
+The accompanying notes are an integral part of these financial statements.
+2021 ANNUAL REPORT
+Deferred tax assets
+Intangible and other non-current assets
+Right-of-use assets
+Equity investments measured at fair value through other
+comprehensive income
+Investments in associates and joint ventures
+Property, plant and equipment
+NON-CURRENT ASSETS
+RMB
+31,2020
+31,2021
+RMB
+Notes
+December
+December
+(All amounts in RMB millions unless otherwise stated)
+As of December 31, 2021
+CONSOLIDATED STATEMENT OF FINANCIAL POSITION
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS PetroChina
+213
+16
+Cash and cash equivalents
+Retained earnings
+26
+1,366,621
+151,463
+145,308
+1,408,869
+TOTAL EQUITY
+NON-CONTROLLING INTERESTS
+1,215,158
+1,263,561
+TOTAL EQUITY ATTRIBUTABLE TO OWNERS OF THE COMPANY
+NON-CURRENT LIABILITIES
+304,182
+31
+Reserves
+727,955
+771,980
+183,021
+183,021
+30
+Share capital
+308,560
+EQUITY ATTRIBUTABLE TO OWNERS OF THE COMPANY:
+Long-term borrowings
+Lease liabilities
+TOTAL NON-CURRENT LIABILITIES
+10,865
+Owners of the Company
+8,795
+Other long-term obligations
+16,380
+26,638
+122,644
+Asset retirement obligations
+123,222
+114,819
+129,405
+33
+251,379
+287,175
+29
+2328
+Deferred tax liabilities
+20
+EQUITY
+1,882,708
+1,984,104
+Income taxes payable
+91,477
+78,481
+28
+316,140
+303,002
+27
+28
+9,915
+Contract liabilities
+486,767
+480,838
+42,615
+CURRENT LIABILITIES
+TOTAL CURRENT ASSETS
+Assets held for sale
+118,631
+136,789
+Accounts payable and accrued liabilities
+3,730
+Other taxes payable
+66,859
+TOTAL ASSETS LESS CURRENT LIABILITIES
+(118,651)
+(37,320)
+NET CURRENT LIABILITIES
+605,418
+518,158
+TOTAL CURRENT LIABILITIES
+9,956
+Liabilities directly associated with the assets held for sale
+6,579
+6,626
+20
+117,542
+53,275
+22
+Lease liabilities
+29
+Short-term borrowings
+59,994
+26
+PROFIT FOR THE YEAR ATTRIBUTABLE TO:
+TO THE SHAREHOLDERS OF PETROCHINA COMPANY LIMITED (CONTINUED)
+(incorporated in the People's Republic of China with limited liability)
+110,195
+Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
+appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group's
+internal control.
+•
+• Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud
+or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient
+and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting
+from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions,
+misrepresentations, or the override of internal control.
+As part of an audit in accordance with HKSAS, we exercise professional judgment and maintain professional scepticism
+throughout the audit. We also:
+Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are
+free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion.
+We report our opinion solely to you, as a body, and for no other purpose. We do not assume responsibility towards or
+accept liability to any other person for the contents of this report. Reasonable assurance is a high level of assurance, but
+is not a guarantee that an audit conducted in accordance with HKSAS will always detect a material misstatement when
+it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they
+could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated
+financial statements.
+Auditor's responsibilities for the audit of the consolidated financial statements
+TO THE SHAREHOLDERS OF PETROCHINA COMPANY LIMITED (CONTINUED)
+(incorporated in the People's Republic of China with limited liability)
+INDEPENDENT AUDITOR'S REPORT
+•
+羅兵咸永道
+2021 ANNUAL REPORT 209
+The Audit Committee is responsible for overseeing the Group's financial reporting process.
+In preparing the consolidated financial statements, the directors are responsible for assessing the Group's ability to
+continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern
+basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or have no realistic
+alternative but to do so.
+The directors of the Company are responsible for the preparation of the consolidated financial statements that give a
+true and fair view in accordance with IFRSS and the disclosure requirements of the Hong Kong Companies Ordinance,
+and for such internal control as the directors determine is necessary to enable the preparation of consolidated financial
+statements that are free from material misstatement, whether due to fraud or error.
+Responsibilities of the directors and the audit committee for the consolidated financial statements
+If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we
+are required to report that fact. We have nothing to report in this regard.
+In connection with our audit of the consolidated financial statements, our responsibility is to read the other information
+and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial
+statements or our knowledge obtained in the audit or otherwise appears to be materially misstated.
+Our opinion on the consolidated financial statements does not cover the other information and we do not express any
+form of assurance conclusion thereon.
+pwc
+The directors of the Company are responsible for the other information. The other information comprises all of the
+information included in the annual report other than the consolidated financial statements and our auditor's report
+thereon.
+Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related
+disclosures made by the directors.
+pwc
+From the matters communicated with the directors, we determine those matters that were of most significance in the
+audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe
+these matters in our auditor's report unless law or regulation precludes public disclosure about the matter or when,
+in extremely rare circumstances, we determine that a matter should not be communicated in our report because the
+adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such
+communication.
+TO THE SHAREHOLDERS OF PETROCHINA COMPANY LIMITED (CONTINUED)
+(incorporated in the People's Republic of China with limited liability)
+INDEPENDENT AUDITOR'S REPORT
+羅兵咸永道
+pwc
+211
+2021 ANNUAL REPORT
+We also provide the directors with a statement that we have complied with relevant ethical requirements regarding
+independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear
+on our independence, and where applicable, actions taken to eliminate threats or safeguards applied.
+210 PETROCHINA COMPANY LIMITED
+We communicate with the directors regarding, among other matters, the planned scope and timing of the audit and
+significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
+Evaluate the overall presentation, structure and content of the consolidated financial statements, including the
+disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a
+manner that achieves fair presentation.
+Conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the
+audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant
+doubt on the Group's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are
+required to draw attention in our auditor's report to the related disclosures in the consolidated financial statements or,
+if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained
+up to the date of our auditor's report. However, future events or conditions may cause the Group to cease to continue
+as a going concern.
+•
+•
+•
+Auditor's responsibilities for the audit of the consolidated financial statements (continued)
+INDEPENDENT AUDITOR'S REPORT
+羅兵咸永道
+Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities
+within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction,
+supervision and performance of the group audit. We remain solely responsible for our audit opinion.
+羅兵咸永道
+Other Information
+TO THE SHAREHOLDERS OF PETROCHINA COMPANY LIMITED (CONTINUED)
+(incorporated in the People's Republic of China with limited liability)
+TO THE SHAREHOLDERS OF PETROCHINA COMPANY LIMITED (CONTINUED)
+(incorporated in the People's Republic of China with limited liability)
+INDEPENDENT AUDITOR'S REPORT
+羅兵咸永道
+pwc
+2021 ANNUAL REPORT 207
+Key audit matter identified in our audit is related to "Recoverability of the carrying amount of oil and gas properties".
+Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the
+consolidated financial statements of the current period. These matters were addressed in the context of our audit of the
+consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate
+opinion on these matters.
+Key audit matters
+Key audit matters (continued)
+We are independent of the Group in accordance with the HKICPA's Code of Ethics for Professional Accountants ("the
+Code"), and we have fulfilled our other ethical responsibilities in accordance with the Code.
+We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
+We conducted our audit in accordance with Hong Kong Standards on Auditing ("HKSAS") issued by the HKICPA.
+Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the
+Consolidated Financial Statements section of our report.
+Basis for opinion
+TO THE SHAREHOLDERS OF PETROCHINA COMPANY LIMITED (CONTINUED)
+(incorporated in the People's Republic of China with limited liability)
+INDEPENDENT AUDITOR'S REPORT
+羅兵咸永道
+pwc
+TOTAL EQUITY AND NON-CURRENT LIABILITIES
+Independence
+Key Audit Matter
+Recoverability of the carrying amount of oil and
+gas properties
+Refer to Note 5 (a) “Critical accounting estimates
+and judgements" and the oil and gas properties
+as included in Note 16 "Property, plant and
+equipment" to the consolidated financial
+statements, with the net book value of oil and gas
+properties amounted to RMB 816,788 million at
+December 31, 2021, and impairment loss of RMB
+19,463 million was recorded for the year ended
+December 31, 2021.
+INDEPENDENT AUDITOR'S REPORT
+pwc
+PETROCHINA COMPANY LIMITED
+208
+Based on our work, we found the key estimations and
+assumptions and input data adopted by management in
+determining the recoverable amounts were supported by the
+evidence we obtained.
+Used professionals with specialized skill and knowledge to
+assist in the evaluation of the appropriateness of discount
+rates adopted by the management.
+Compared the future cost profiles against historical costs
+or relevant budgets of the Group or relevant external data;
+Compared the future production profiles against the
+oil and gas reserve estimation report approved by the
+management. Evaluated the competence, capability
+and objectivity of the management's experts engaged
+in estimating the oil and gas reserves. Assessed key
+estimations or assumptions used in the reserve estimation,
+by reference to historical data, management plans and/or
+relevant external data;
+For certain projects which management has decided
+not to further develop, corroborated evidence of future
+development plans and capital allocation decisions;
+Assessed the appropriateness of the method used
+to determine recoverable amounts, including the
+methodology adopted in the discounted cash flow
+projections, tested mathematical accuracy of the
+projections, and the completeness, accuracy, and
+relevance of underlying data used in the projections;
+Compared estimates of future crude oil prices adopted
+by the Group against a range of published crude oil price
+forecasts;
+Evaluated and tested the key controls relating to the
+determination of recoverable amounts of oil and gas
+properties;
+Obtained an understanding of the management's internal
+control and assessment process of impairment of oil and
+gas properties and assessed the inherent risk of material
+misstatement by considering the degree of estimation
+uncertainty and level of other inherent risk factors such
+as complexity, subjectivity, changes and susceptibility to
+management bias or fraud;
+In addressing this matter, we performed the following key
+audit procedures:
+How our audit addressed the Key Audit Matter
+Because of the significance of the carrying amount
+of the oil and gas properties as at December
+31, 2021, together with the significant estimates
+and judgements by management in the use of
+key estimates and assumptions in determining
+recoverable amounts for oil and gas properties,
+we had placed our audit emphasis on this matter.
+- Discount rates.
+- Future production volumes; and
+- Future costs;
+- Future oil prices;
+An impairment loss is recognised for the amount
+by which the carrying amount of oil and gas
+properties exceeds the higher of its fair value less
+costs to sell and its value in use. The Group's
+determination of the recoverable amounts for oil
+and gas properties involved key estimates and
+assumptions, including:
+Uncertainty in future oil prices, future production
+costs, changes in operating conditions and the
+economic outlook gave rise to possible indicators
+that the carrying amount of the oil and gas
+properties as at December 31, 2021 might be
+impaired.
+The engagement partner on the audit resulting in this independent auditor's report is HON CHONG HENG.
+PricewaterhouseCoopers
+Certified Public Accountants
+Hong Kong, March 31, 2022
+212 PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS
+7
+PROFIT BEFORE INCOME TAX EXPENSE
+3,533
+13,267
+SHARE OF PROFIT OF ASSOCIATES AND JOINT VENTURES
+(23,397)
+(16,217)
+TOTAL NET FINANCE COSTS
+158,203
+(26,528)
+10
+10
+Interest expense
+3,023
+2,984
+Interest income
+14,387
+(14,279)
+(12,839)
+(19,739)
+56,073
+INCOME TAX EXPENSE
+12
+TOTAL COMPREHENSIVE INCOME FOR THE YEAR
+(441)
+(11,130)
+(4,501)
+OTHER COMPREHENSIVE INCOME, NET OF TAX
+(4)
+Share of the other comprehensive income of associates and joint ventures
+accounted for using the equity method
+(10,802)
+(4,729)
+Items that are or may be reclassified subsequently to profit or loss
+Currency translation differences
+113
+232
+Fair value changes in equity investment measured at fair value through other
+comprehensive income
+Item that will not be reclassified to profit or loss
+OTHER COMPREHENSIVE INCOME
+33,485
+114,696
+PROFIT FOR THE YEAR
+(22,588)
+(43,507)
+13,377
+22,355
+75,937
+(2,453,196)
+161,153
+8
+Employee compensation costs
+(1,267,797)
+(1,770,019)
+1,933,836
+2,614,349
+6
+RMB
+(154,835)
+2020
+Notes
+Purchases, services and other
+OPERATING EXPENSES
+REVENUE
+(All amounts in RMB millions unless otherwise stated)
+For the year ended December 31, 2021
+CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
+PETROCHINA COMPANY LIMITED
+2021
+RMB
+(147,604)
+Exploration expenses, including exploratory dry holes
+(24,248)
+50,905
+12,980
+(195,850)
+(228,003)
+9
+Exchange loss
+Exchange gain
+FINANCE COSTS
+PROFIT FROM OPERATIONS
+TOTAL OPERATING EXPENSES
+Other income, net
+Taxes other than income taxes
+(64,345)
+(57,802)
+Selling, general and administrative expenses
+(213,875)
+(231,269)
+Depreciation, depletion and amortisation
+(19,333)
+(1,857,899)
+575,235
+1,984,104
+(15,889)
+1,882,708
+2,224
+Proceeds from Pipeline restructuring
+31,074
+80,621
+Interest received
+2,836
+2,532
+Dividends received
+12,274
+4,778
+Decrease/(increase) in time deposits with maturities over three months
+1,627
+(12,063)
+(213,032)
+(181,986)
+NET CASH FLOWS USED FOR INVESTING ACTIVITIES
+CASH FLOWS FROM FINANCING ACTIVITIES
+Repayments of short-term borrowings
+(758,307)
+4,183
+(797,892)
+Proceeds from disposal of other non-current assets
+2,746
+2020
+RMB
+RMB
+CASH FLOWS FROM INVESTING ACTIVITIES
+Capital expenditures
+(261,617)
+(248,376)
+Acquisition of investments in associates and joint ventures
+(387)
+(2,599)
+Prepayments on long-term leases
+(3,048)
+Acquisition of intangible assets and other non-current assets
+(3,946)
+(5,303)
+Acquisition of subsidiaries
+(1,822)
+(1,947)
+Proceeds from disposal of property, plant and equipment
+1,195
+2021
+Increase in short-term borrowings
+Increase in long-term borrowings
+Repayments of lease liabilities
+(5)
+NET CASH FLOWS USED FOR FINANCING ACTIVITIES
+(107,971)
+(99,400)
+TRANSLATION OF FOREIGN CURRENCY
+(2,308)
+(4,967)
+Increase in cash and cash equivalents
+18,158
+32,222
+Cash and cash equivalents at beginning of the year
+118,631
+86,409
+Cash and cash equivalents at end of the year
+136,789
+118,631
+The accompanying notes are an integral part of these financial statements.
+216 PETROCHINA COMPANY LIMITED
+516,087
+(69)
+Repayments of long-term borrowings
+Capital reduction in subsidiaries paid to non-controlling interests
+673
+Interest paid
+Dividends paid to non-controlling interests
+681,258
+751,157
+(78,127)
+(219,770)
+128,834
+238,335
+(13,016)
+(12,821)
+(16,700)
+(16,508)
+(14,264)
+Dividends paid to owners of the Company
+(39,866)
+(28,078)
+Cash paid to acquire non-controlling interests
+(22)
+Cash contribution from non-controlling interests
+613
+(All amounts in RMB millions unless otherwise stated)
+(12,794)
+PETROCHINA COMPANY LIMITED
+Depreciation, depletion and amortisation
+231,269
+213,875
+Capitalised exploratory costs charged to expense
+12,557
+8,934
+Safety fund reserve
+(1,750)
+(1,505)
+Share of profit of associates and joint ventures
+(13,267)
+(3,533)
+Accrual of provision for impairment of receivables, net
+415
+343
+Write down in inventories, net
+580
+8,151
+Impairment of other non-current assets
+22,588
+465
+43,507
+Adjustments for:
+Chairman
+CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)
+For the Year Ended December 31, 2021
+Dai Houliang
+The accompanying notes are an integral part of these financial statements.
+214 PETROCHINA COMPANY LIMITED
+Director and President
+Huang Yongzhang
+Chief Financial Officer
+Chai Shouping
+PETROCHINA COMPANY LIMITED
+CONSOLIDATED STATEMENT OF CASH FLOWS
+For the Year Ended December 31, 2021
+(All amounts in RMB millions unless otherwise stated)
+CASH FLOWS FROM OPERATING ACTIVITIES
+Profit for the year
+FINANCIAL STATEMENTS
+2021
+2020
+RMB
+RMB
+33,485
+Income tax expense
+Loss on disposal and scrap of property, plant and equipment
+Loss/(gain) on disposal and scrap of other non-current assets
+114,696
+18,959
+Accounts payable and accrued liabilities
+2,251
+8,410
+Contract liabilities
+(12,996)
+8,987
+CASH FLOWS GENERATED FROM OPERATIONS
+367,962
+337,679
+(26,493)
+(19,104)
+NET CASH FLOWS FROM OPERATING ACTIVITIES
+341,469
+318,575
+The accompanying notes are an integral part of these financial statements.
+2021 ANNUAL REPORT
+Gain on disposal of subsidiaries
+215
+FINANCIAL STATEMENTS PetroChina
+43,645
+Inventories
+Income taxes paid
+(8,265)
+(1,142)
+14,751
+(3,575)
+(1,242)
+Gain on Pipeline restructuring
+Dividend income
+(46,946)
+(17)
+(25)
+(18,320)
+(2,984)
+Accounts receivable, prepayments and other current assets
+Changes in working capital:
+Interest income
+5,398
+Interest expense
+587
+19,739
+(3,023)
+26,528
+219
+Certain new accounting standards, amendments to accounting standards and interpretations have been published
+that are not mandatory for the December 31, 2021 reporting period and have not been early adopted by the Group.
+These standards, amendments or interpretations are not expected to have a material impact on the Group in the current
+or future reporting periods and on foreseeable future transactions.
+(a) Basis of consolidation
+(b) New and amended standards and interpretations not yet adopted by the Group
+Subsidiaries are entities controlled by the Group. The Group controls an entity when it is exposed to, or has right to,
+variable returns from its involvement with the entity and has the ability to affect those returns through its power over the
+entity.
+A subsidiary is consolidated from the date on which control is transferred to the Group and is no longer consolidated
+from the date that control ceases. The Group accounts for business combinations (except for business combination
+under common control) using the acquisition method when the acquired set of activities and assets meets the definition
+of a business and control is transferred to the Group. In determining whether a particular set of activities and assets
+is a business, the Group assesses whether the set of assets and activities acquired includes, at a minimum, an input
+and substantive process and whether the acquired set has the ability to produce outputs. The Group has an option to
+apply a 'concentration test' that permits a simplified assessment of whether an acquired set of activities and assets is
+not a business. The optional concentration test is met if substantially all of the fair value of the gross assets acquired is
+concentrated in a single identifiable asset or group of similar identifiable assets. The consideration transferred for the
+acquisition of a subsidiary is the fair values of the assets transferred, the liabilities incurred and the equity interests issued
+by the Group. The consideration transferred includes the fair value of any asset or liability resulting from a contingent
+consideration arrangement. Acquisition-related costs are expensed as incurred. Identifiable assets acquired and liabilities
+assumed in a business combination are measured initially at their fair values at the acquisition date. Contingent liabilities
+assumed in a business combination are recognised in the acquisition accounting if they are present obligations and their
+fair value can be measured reliably. On an acquisition-by-acquisition basis, the Group recognises any non-controlling
+interests in the acquiree either at fair value or at the non-controlling interests' proportionate share of the acquiree's net
+assets.
+(All amounts in RMB millions unless otherwise stated)
+The excess of the consideration transferred, the amount of any non-controlling interests in the acquiree and the
+acquisition-date fair value of any previous equity interest in the acquiree over the fair value of the identifiable net assets is
+recorded as goodwill. If this is less than the fair value of the net assets of the subsidiary acquired in the case of a bargain
+purchase, the difference is recognised directly in the consolidated statement of comprehensive income.
+An acquisition of a business which is a business combination under common control is accounted for in a manner
+similar to a uniting of interests whereby the assets and liabilities acquired are accounted for at carryover predecessor
+values to the other party to the business combination with all periods presented as if the operations of the Group and the
+business acquired have always been combined. The difference between the consideration paid by the Group and the net
+assets or liabilities of the business acquired is adjusted against equity.
+2021 ANNUAL REPORT
+3 SUMMARY OF PRINCIPAL ACCOUNTING POLICIES
+Associates are entities over which the Group has significant influence but not control, generally accompanying a
+shareholding of between 20% and 50% of the voting rights. Investments in associates are accounted for by the equity
+method of accounting in the consolidated financial statements of the Group and are initially recognised at cost.
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+Intercompany transactions, balances and unrealised gains on transactions between group companies are
+eliminated. Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that there is no
+evidence of impairment. Where necessary, accounting policies of subsidiaries have been changed to ensure consistency
+with the policies adopted by the Group.
+For purpose of the presentation of the Company's statement of financial position, investments in subsidiaries are
+accounted for at cost less impairment.
+A listing of the Group's principal subsidiaries is set out in Note 19.
+(b) Investments in associates
+Under this method of accounting, the Group's share of the post-acquisition profits or losses of associates is
+recognised in profit or loss and its share of post-acquisition movements in other comprehensive income is recognised
+in other comprehensive income. The cumulative post-acquisition movements are adjusted against the carrying amounts
+of the investments. When the Group's share of losses in an associate equals or exceeds its interest in the associate,
+including any other unsecured receivables, the Group does not recognise further losses, unless it has incurred obligations
+or made payments on behalf of the associate.
+Unrealised gains on transactions between the Group and its associates are eliminated to the extent of the Group's
+interest in the associates; unrealised losses are also eliminated unless the transaction provides evidence of an impairment
+of the asset transferred. The Group's investment in associates includes goodwill identified on acquisition, net of any
+accumulated impairment loss and is tested for impairment as part of the overall balance. Goodwill represents the excess
+of the cost of an acquisition over the fair value of the Group's share of the fair value of net identifiable assets of the
+acquired associate at the date of acquisition. Accounting policies of associates have been changed where necessary to
+ensure consistency with the policies adopted by the Group. The gain or loss resulting from a downstream transaction
+involving assets that constitute a business, as defined in IFRS 3, between the Group and its associate or joint venture is
+recognised in full in the consolidated financial statement.
+A listing of the Group's principal associates is shown in Note 17.
+Joint ventures are arrangements in which the Group with one or more parties have joint control, whereby the Group
+has rights to the net assets of the arrangements, rather than rights to their assets and obligations for their liabilities. The
+Group's interests in joint ventures are accounted for by the equity method of accounting (Note 3(b)) in the consolidated
+financial statements.
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(c) Investments in joint ventures
+FINANCIAL STATEMENTS PetroChina
+FINANCIAL STATEMENTS
+(72)
+145,308
+218
+(12,380)
+A listing of the Group's principal joint ventures is shown in Note 17.
+134
+183,021
+771,980
+168
+308,560
+302
+1,263,561
+230
+1,408,869
+The accompanying notes are an integral part of these financial statements.
+2021 ANNUAL REPORT
+217
+FINANCIAL STATEMENTS PetroChina
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+1 ORGANISATION AND PRINCIPAL ACTIVITIES
+PetroChina Company Limited (the "Company") was established as a joint stock company with limited liability on
+November 5, 1999 by
+KAKLIAI (China National Petroleum Corporation ("CNPC")) as the sole proprietor
+in accordance with the approval Guo Jing Mao Qi Gai [1999] No. 1024 "Reply on the approval of the establishment of
+PetroChina Company Limited" from the former State Economic and Trade Commission of the People's Republic of China
+("China" or "PRC"). CNPC restructured ("the Restructuring") and injected its core business and the related assets and
+liabilities into the Company. 中國石油天然氣集團公司 was renamed 中國石油天然氣集團有限公司(CNPC before and
+after the change of name) on December 19, 2017. CNPC is a wholly state-owned company registered in China. The
+Company and its subsidiaries are collectively referred to as the "Group".
+The Group is principally engaged in (i) the exploration, development, transportation and production and marketing
+of crude oil and natural gas; (ii) the refining of crude oil and petroleum products, production and marketing of primary
+petrochemical products, derivative petrochemical products and other chemical products; (iii) the marketing of refined
+products and non-oil products, and trading business; and (iv) the transportation and the sale of natural gas (Note 39).
+2 BASIS OF PREPARATION
+The consolidated financial statements of the Group have been prepared in accordance with the International
+Financial Reporting Standards ("IFRSS") as issued by the International Accounting Standards Board ("IASB"). These
+financial statements also comply with the disclosure requirements of the Hong Kong Companies Ordinance and the
+applicable disclosure provisions of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong
+Limited. A number of new or amended standards became applicable for the current reporting period. The Group did not
+have to change its accounting policies or make retrospective adjustments as a result of adopting these new or amended
+standards. The consolidated financial statements and the statement of financial position of the Company have been
+prepared under the historical cost convention except as disclosed in the accounting policies below.
+The preparation of financial statements in conformity with IFRSS requires the use of estimates and assumptions that
+affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the
+statement of financial position and the reported amounts of revenues and expenses during the reporting period. Although
+these estimates are based on management's best knowledge of current events and actions, actual results may ultimately
+differ from those estimates. The areas involving a higher degree of judgement or complexity, or areas where assumptions
+and estimates are significant to the consolidated financial statements are disclosed in Note 5.
+(a) New and amended standards and interpretations adopted by the Group
+On August 27, 2020, the IASB published amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16-Interest
+rate benchmark (IBOR) reform-Phase 2. These amendments should be applied for annual periods beginning on or after
+January 1, 2021, which have no material impact on the Group for the December 31, 2021 reporting period.
+PETROCHINA COMPANY LIMITED
+220
+4 to 14 years
+FINANCIAL STATEMENTS
+Estimated residual
+value ratio %
+Annual depreciation
+rate %
+Buildings
+8 to 40 years
+5
+2.4 to 11.9
+Equipment and Machinery
+4 to 30 years
+3 to 5
+3.2 to 24.3
+Motor Vehicles
+5
+6.8 to 23.8
+Other
+5 to 12 years
+5
+От
+7.9 to 19.0
+222
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+No depreciation is provided on construction in progress until the assets are completed and ready for use.
+769
+lives
+Estimated useful
+The Group uses the following estimated useful lives, estimated residual value ratios and annual depreciation rates
+for depreciation purposes:
+Depreciation, to write off the cost of each asset, other than oil and gas properties (Note 3(h)), to their residual values
+over their estimated useful lives is calculated using the straight-line method.
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+(d) Transactions with non-controlling interests
+Transactions with non-controlling interests are treated as transactions with owners in their capacity as owners of
+the Group. Gains and losses resulting from disposals to non-controlling interests are recorded in equity. The differences
+between any consideration paid and the relevant share of the carrying value of net assets of the subsidiary acquired
+resulting from the purchase of non-controlling interests, are recorded in equity.
+When the Group ceases to have control or significant influence, any retained interest in the entity is remeasured to
+its fair value, with the change in carrying amount recognised in profit or loss. The fair value is the initial carrying amount
+for the purposes of subsequently accounting for the retained interest as an associate, joint venture or financial asset.
+In addition, any amounts previously recognised in other comprehensive income in respect of that entity are accounted
+for as if the Group had directly disposed of the related assets or liabilities. The amounts previously recognised in other
+comprehensive income are reclassified to profit or loss.
+If the ownership interest in an associate is reduced but significant influence is retained, only a proportionate share of
+the amounts previously recognised in other comprehensive income are reclassified to profit or loss where appropriate.
+(e) Foreign currencies
+Items included in the financial statements of each entity in the Group are measured using the currency of the primary
+economic environment in which the entity operates ("the functional currency"). Most assets and operations of the Group
+are located in the PRC (Note 39), and the functional currency of the Company and most of the consolidated subsidiaries
+is the Renminbi ("RMB”). The consolidated financial statements are presented in the presentation currency of RMB.
+Foreign currency transactions of the Group are accounted for at the exchange rates prevailing at the respective
+dates of the transactions; monetary assets and liabilities denominated in foreign currencies are translated at exchange
+rates at the date of the statement of financial position; gains and losses resulting from the settlement of such transactions
+and from the translation of monetary assets and liabilities are recognised in profit or loss.
+For the Group entities that have a functional currency different from the Group's presentation currency, assets and
+liabilities for each statement of financial position presented are translated at the closing rate at the date of the statement
+of financial position. Income and expenses for each statement of comprehensive income presented are translated at the
+average exchange rates for each period and the resulting exchange differences are recognised in other comprehensive
+income.
+2021 ANNUAL REPORT
+221
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS PetroChina
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+(f) Discontinued operation
+A discontinued operation is a component of the Group's business, the operation and cash flows of which can be
+clearly distinguished from the rest of the Group and which:
+- represents a separate major line of business of geographic area of operations;
+-
+is part of a single co-ordinated plan to dispose of a separate major line of business or geographic area of
+operations; or
+- is a subsidiary acquired exclusively with a view to resale.
+Classification as a discontinued operation occurs at the earlier of disposal or when the operation meets the criteria
+to be classified as held-for-sale.
+When an operation is classified as a discontinued operation, the comprehensive statement of profit or loss and
+other comprehensive income ("OCI”) is re-presented as if the operation had been discontinued from the start of the
+comparative year.
+(g) Property, plant and equipment
+Property, plant and equipment, including oil and gas properties (Note 3(h)), are initially recorded in the consolidated
+statement of financial position at cost if it is probable that they will generate future economic benefits. Cost represents
+the purchase price of the asset and other costs incurred to bring the asset into intended use. Subsequent to their initial
+recognition, property, plant and equipment are carried at cost less accumulated depreciation, depletion and amortisation
+(including any impairment).
+PETROCHINA COMPANY LIMITED
+1,059
+Other comprehensive income for the year
+Balance at December 31, 2021
+(6,758)
+(11,130)
+Special reserve-safety fund reserve
+(1,633)
+(1,633)
+128
+(1,505)
+Transfer to reserves
+(6,275)
+6,275
+Dividends
+Transaction with non-controlling interests
+in subsidiaries
+Capital contribution from non-controlling
+interests
+Pipeline restructuring
+Acquisition of subsidiaries
+Disposal of subsidiaries
+Other
+Balance at December 31, 2020
+(28,078)
+(28,078)
+(14,827)
+(42,905)
+(2)
+(2)
+2
+(4,372)
+(4,372)
+ended December 31, 2020
+The assets' residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting
+period.
+(All amounts in RMB millions unless otherwise stated)
+FINANCIAL STATEMENTS
+Attributable to owners of the Company
+Non-
+controlling
+Interests
+Total
+Equity
+Share
+Capital
+Retained
+Earnings
+RMB
+RMB
+Reserves
+RMB
+Subtotal
+2
+RMB
+RMB
+Balance at January 1, 2020
+183,021
+743,124
+304,011
+1,230,156
+214,149 1,444,305
+Profit for the year ended December 31,
+2020
+19,006
+19,006
+14,479
+33,485
+RMB
+823
+825
+(57,425)
+(2,609)
+(2,609)
+(1,892)
+(4,501)
+Special reserve-safety fund reserve
+(1,579)
+(1,579)
+(171)
+(1,750)
+Transfer to reserves
+(8,413)
+8,413
+ended December 31, 2021
+Dividends
+Capital contribution from non-controlling
+interests
+(39,866)
+(39,866)
+(15,975)
+(55,841)
+(15)
+(15)
+(19)
+(34)
+Acquisition of subsidiaries
+Disposal of subsidiaries
+Other
+Transaction with non-controlling interests
+in subsidiaries
+1,059
+769
+(12,380)
+Other comprehensive income for the year
+22,526
+(57,425)
+1
+1
+1,186
+1,187
+(489)
+(489)
+178
+183,021
+727,955
+(102)
+304,182
+76
+114,696
+199
+1,215,158
+151,463
+1,366,621
+Balance at January 1, 2021
+183,021
+727,955
+304,182 1,215,158
+151,463 1,366,621
+Profit for the year ended December 31,
+2021
+92,170
+92,170
+275
+Property, plant and equipment, including oil and gas properties (Note 3(h)) and right-of-use assets (Note 3(m)), are
+reviewed for possible impairment when events or changes in circumstances indicate that the carrying amount may not
+be recoverable. An impairment loss is recognised for the amount by which the carrying amount of a cash-generating unit
+exceeds the higher of its fair value less costs to sell and its value in use. Value in use is the estimated net present value of
+future cash flows to be derived from the cash-generating unit.
+PETROCHINA COMPANY LIMITED
+Interest and other costs on borrowings to finance the construction of property, plant and equipment, including oil
+and gas properties (Note 3(h)), are capitalised during the period of time that is required to complete and prepare the
+asset for its intended use. Costs for repairs and maintenance activities are expensed as incurred except for costs of
+components that result in improvements or betterments which are capitalised as part of property, plant and equipment
+and depreciated over their useful lives.
+- it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling
+financial assets; and
+― its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on
+the principal amount outstanding.
+On initial recognition of an equity investment that is not held for trading, the Group may irrevocably elect to present
+subsequent changes in the investment's fair value in OCI. This election is made on an investment-by-investment basis.
+All financial assets not classified as measured at amortised cost or FVOCI as described above are measured at
+FVTPL. This includes all derivative financial assets.
+The Group makes an assessment of the objective of the business model in which a financial asset is held at a
+portfolio level because this best reflects the way the business is managed and information is provided to management.
+2021 ANNUAL REPORT 225
+FINANCIAL STATEMENTS PetroChina
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+For the purposes of this assessment whether contractual cash flows are solely payments of principal and interest,
+"principal" is defined as the fair value of the financial asset on initial recognition. “Interest” is defined as consideration for
+the time value of money and for the credit risk associated with the principal amount outstanding during a particular period
+of time and for other basic lending risks and costs (e.g. liquidity risk and administrative costs), as well as a profit margin.
+In assessing whether the contractual cash flows are solely payments of principal and interest, the Group considers
+the contractual terms of the instrument. This includes assessing whether the financial asset contains a contractual term
+that could change the timing or amount of contractual cash flows such that it would not meet this condition.
+Detailed accounting policies for subsequent measurement of financial assets are set out below:
+A debt investment is measured at FVOCI if it meets both of the following conditions and is not designated as at
+FVTPL:
+Financial assets at FVTPL
+Debt investments at FVOCI
+Equity investments at FVOCI
+These assets are subsequently measured at amortised cost using the effective interest
+method. The amortised cost is reduced by impairment losses. Interest income,
+foreign exchange gains and losses and impairment are recognised in profit or loss.
+Any gain or loss on derecognition is recognised in profit or loss.
+These assets are subsequently measured at fair value. Interest income calculated
+using the effective interest method, foreign exchange gains and losses and
+impairment are recognised in profit or loss. Other net gains and losses are
+recognised in OCI. On derecognition, gains and losses accumulated in OCI are
+reclassified to profit or loss.
+These assets are subsequently measured at fair value. Dividends are recognised as
+income in profit or loss unless the dividend clearly represents a recovery of part of
+the cost of the investment. Other net gains and losses are recognised in OCI and are
+never reclassified to profit or loss.
+(c) Derecognition
+Financial assets
+The Group derecognises a financial asset when the contractual rights to the cash flows from the financial asset
+expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all of the
+risks and rewards of ownership of the financial asset are transferred or in which the Group neither transfers nor retains
+substantially all of the risks and rewards of ownership and it does not retain control of the financial asset.
+The Group enters into transactions whereby it transfers assets recognised in its consolidated statement of financial
+position, but retains either all or substantially all of the risks and rewards of the transferred assets. In these cases, the
+transferred assets are not derecognised.
+226
+PETROCHINA COMPANY LIMITED
+CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
+For the Year Ended December 31, 2021
+Gains and losses on disposals of property, plant and equipment are determined by reference to their carrying
+amounts and are recorded in profit or loss.
+Financial assets at amortised cost
+- its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on
+the principal amount outstanding.
+These assets are subsequently measured at fair value. Net gains and losses, including
+any interest or dividend income, are recognised in profit or loss.
+A financial asset is measured at amortised cost if it meets both of the following conditions and is not designated as
+at FVTPL:
+(h) Oil and gas properties
+- it is held within a business model whose objective is to hold assets to collect contractual cashflows; and
+The successful efforts method of accounting is used for oil and gas exploration and production activities. Under
+this method, all costs for development wells, support equipment and facilities, and proved mineral interests in oil and
+gas properties are capitalised. Geological and geophysical costs are expensed when incurred. Costs of exploratory wells
+are capitalised pending determination of whether the wells find proved oil and gas reserves. Proved oil and gas reserves
+are the estimated quantities of crude oil and natural gas, which, by analysis of geoscience and engineering data, can be
+estimated with reasonable certainty to be economically producible from a given date forward, from known reservoirs, and
+under existing economic conditions, operating methods, and government regulation before the time at which contracts
+providing the right to operate expire, unless evidence indicates that renewal is reasonably certain, regardless of whether
+the estimate is a deterministic estimate or probabilistic estimate. Existing economic conditions include prices and costs
+at which economic producibility from a reservoir is to be determined. The price shall be the average price during the
+12-month period before the ending date of the period covered by the proved oil and gas reserve report, determined as
+an unweighted arithmetic average of the first-day-of-the-month price for each month within such period unless prices
+are defined by contractual arrangements, excluding escalations based upon future conditions. The costs shall be that
+prevailing at the end of the period.
+Exploratory wells in areas not requiring major capital expenditures are evaluated for economic viability within one
+year of completion of drilling. The related well costs are expensed as dry holes if it is determined that such economic
+viability is not attained. Otherwise, the related well costs are reclassified to oil and gas properties and are subject to
+impairment review (Note 3(g)). For exploratory wells that are found to have economically viable reserves in areas where
+major capital expenditure will be required before production can commence, the related well costs remain capitalised only
+if additional drilling is underway or firmly planned. Otherwise the related well costs are expensed as dry holes. The Group
+does not have any significant costs of unproved properties capitalised in oil and gas properties.
+2021 ANNUAL REPORT 223
+FINANCIAL STATEMENTS PetroChina
+PETROCHINA COMPANY LIMITED
+(All amounts in RMB millions unless otherwise stated)
+The Ministry of Natural Resources in China issues production licenses to applicants on the basis of the reserve
+reports approved by relevant authorities.
+The cost of oil and gas properties is amortised at the field level based on the units of production method. Units
+of production rates are based on oil and gas reserves estimated to be recoverable from existing facilities based on the
+current terms of the Group's production licenses.
+(i) Intangible assets and goodwill
+Expenditures on acquired patents, trademarks, technical know-how and licenses are capitalised at historical cost
+and amortised using the straight-line method over their estimated useful lives. Intangible assets are not subsequently
+revalued. The carrying amount of each intangible asset is reviewed and adjusted for impairment whenever events or
+changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised
+whenever the carrying amount of an intangible asset exceeds its recoverable amount and is recognised in profit or loss.
+The recoverable amount is measured as the higher of fair value less costs to sell and value in use. Value in use is the
+estimated net present value of future cash flows to be derived from the asset.
+Goodwill arises on the acquisition of subsidiaries and represents the excess of the consideration transferred over
+the net fair value of identifiable assets, liabilities and contingent liabilities of the acquiree and the amount of any non-
+controlling interests in the acquiree.
+Goodwill impairment reviews are undertaken annually or more frequently if events or changes in circumstances
+indicate a potential impairment. An impairment loss is recognised if the carrying amount of the cash-generating unit
+containing goodwill exceeds its recoverable amount. Impairment losses are allocated first to reduce the carrying amount
+of any goodwill allocated to the cash-generating unit, and then to reduce the carrying amounts of the other assets
+in the cash-generating unit on a pro rata basis. Any impairment is recognised immediately as an expense and is not
+subsequently reversed.
+NOTES TO THE FINANCIAL STATEMENTS
+Non-current assets, or disposal groups comprising assets and liabilities, are classified as held-for-sale if it is highly
+probable that they will be recovered primarily through sale rather than through continuing use.
+Financial assets are not reclassified subsequent to their initial recognition unless the Group changes its business
+model for managing financial assets, in which case all affected financial assets are reclassified on the first day of the first
+reporting period following the change in the business model.
+On initial recognition, a financial asset is classified as measured at: amortised cost; Fair value through other
+comprehensive income ("FVOCI") - debt investment; FVOCI – equity investment; or FVTPL.
+(i) Assets held for sale
+(b) Classification and subsequent measurement
+A financial asset (unless it is a accounts receivable without a significant financing component) or financial liability is
+initially measured at fair value plus, for an item not at Fair value through profit or loss ("FVTPL"), transaction costs that are
+directly attributable to its acquisition or issue. An accounts receivable without a significant financing component is initially
+measured at the transaction price.
+(a) Recognition and initial measurement
+(k) Financial instruments
+Accounts receivable and debt securities issued are initially recognised when they are originated. All other financial
+assets and financial liabilities are initially recognised when the Group becomes a party to the contractual provisions of the
+instrument.
+(All amounts in RMB millions unless otherwise stated)
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+FINANCIAL STATEMENTS
+224 PETROCHINA COMPANY LIMITED
+Once classified as held-for-sale, intangible assets and property, plant and equipment are no longer amortised or
+depreciated, and any equity-accounted investee is no longer equity accounted.
+Such assets, or disposal groups, are generally measured at the lower of their carrying amount and fair value less
+costs to sell. Any impairment loss on a disposal group is allocated first to goodwill, and then to the remaining assets
+and liabilities on a pro rata basis, except that no loss is allocated to inventories, financial assets, deferred tax assets,
+employee benefit assets, investment property or biological assets, which continue to be measured in accordance with
+the Group's other accounting policies. Impairment losses on initial classification as held-for-sale and subsequent gains
+and losses on remeasurement are recognized in profit or loss.
+The Group also incurs various other taxes and levies that are not income taxes. "Taxes other than income taxes",
+which form part of operating expenses, primarily comprise consumption tax (Note 9), resource tax (Note 9), crude oil
+special gain levy (Note 9), urban construction tax and education surcharges.
+(b) Deferred tax
+Deferred tax is provided in full, using the liability method, for temporary differences arising between the tax bases of
+assets and liabilities and their carrying values in the financial statements. However, deferred tax is not accounted for if it
+arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of
+the transaction affects neither accounting nor taxable profit or loss. Deferred tax is determined using tax rates that have
+been enacted or substantively enacted by the date of the statement of financial position and are expected to apply to the
+period when the related deferred tax asset is realised or deferred tax liability is settled, and reflects uncertainty related to
+income taxes, if any.
+Current tax comprises the expected tax payable or receivable on the taxable income or loss for the year and any
+adjustment to the tax payable or receivable in respect of previous years. The amount of current tax payable or receivable
+is the best estimate of the tax amount expected to be paid or received that reflects uncertainty related to income taxes,
+if any. It is measured using tax rates enacted or substantively enacted at the reporting date. Current tax also includes any
+tax arising from dividends.
+The principal temporary differences arise from depreciation on oil and gas properties and equipment and provision
+for impairment of receivables, inventories, investments and property, plant and equipment. Deferred tax assets relating
+to the carry forward of unused tax losses and deductible temporary differences are recognised to the extent that it is
+probable that future taxable income will be available against which they can be used.
+(c) Taxes other than income tax
+Current tax assets and liabilities are offset only if certain criteria are met.
+2021 ANNUAL REPORT 233
+Income is classified by the Group as revenue when it arises from the sale of crude oil, natural gas, refined products,
+chemical products, non-oil products, etc., and the provision of services in the ordinary course of the Group's business.
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+(x) Revenue recognition
+Revenue is recognised when control over a product or service is transferred to the customer at the amount of
+promised consideration to which the Group is expected to be entitled, excluding those amounts collected on behalf of
+third parties. Revenue excludes value added tax or other sales taxes and is after deduction of any trade discounts.
+Where the contract contains a financing component more than 12 months, interest income is accrued or interest
+expense is accrued separately under the effective interest method. The Group does not adjust the consideration for any
+effects of a significant financing component if the period of financing is 12 months or less.
+(a) Current tax
+(y) Provisions
+FINANCIAL STATEMENTS PetroChina
+The Group has determined that interest and penalties related to income taxes, including uncertain tax treatments,
+do not meet the definition of income taxes, and therefore accounted for them under IAS 37 "Provisions, Contingent
+Liabilities and Contingent Assets".
+(u) Share capital
+(w) Taxation
+Provisions are recognised when the Group has present legal or constructive obligations as a result of past events,
+it is probable that an outflow of resources will be required to settle the obligations, and reliable estimates of the amounts
+can be made.
+(t) Borrowings
+Borrowings are recognised initially at fair value, net of transaction costs incurred. In subsequent periods, borrowings
+are stated at amortised cost using the effective interest method.
+General and specific borrowing costs directly attributable to the acquisition, construction or production of qualifying
+assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are
+added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale.
+All other borrowing costs are recognised in profit or loss in the period in which they are incurred.
+Borrowings are classified as current liabilities unless the Group has unconditional rights to defer settlements of the
+liabilities for at least 12 months after the reporting period.
+Incremental costs directly attributable to the issue of ordinary shares are recognised as a deduction from equity.
+Income tax relating to transaction costs of an equity transaction is accounted for in accordance with IAS 12 "Income
+Taxes".
+(v) Interest income and interest expense
+Income tax expense comprises current and deferred tax. It is recognised in profit or loss except to the extent that it
+relates to a business combination, or items recognised directly in equity or in other comprehensive income.
+Interest income or expense is recognised using the effective interest method.
+- the gross carrying amount of the financial asset; or
+- the amortised cost of the financial liability.
+In calculating interest income and expense, the effective interest rate is applied to the gross carrying amount of the
+asset (when the asset is not credit-impaired) or to the amortised cost of the liability. However, for financial assets that
+have become credit-impaired subsequent to initial recognition, interest income is calculated by applying the effective
+interest rate to the amortised cost of the financial asset. If the asset is no longer credit-impaired, then the calculation of
+interest income reverts to the gross basis.
+232
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+The “effective interest rate” is the rate that exactly discounts estimated future cash payments or receipts through the
+expected life of the financial instrument to:
+Provision for future decommissioning and restoration is recognised in full on the installation of oil and gas properties.
+The amount recognised is the present value of the estimated future expenditure determined in accordance with local
+conditions and requirements. A corresponding addition to the related oil and gas properties of an amount equivalent
+to the provision is also created. This is subsequently depreciated as part of the costs of the oil and gas properties.
+Any change in the present value of the estimated expenditure other than due to passage of time which is regarded
+as interest expense, is reflected as an adjustment to the provision and oil and gas properties. Due to technological
+progress, legal requirements or changes in the market environment, changes in the provisions caused by changes in the
+amount of expenditure, estimated time of retirement obligations, discount rate, etc., may occur in fulfilling the retirement
+obligation. For an increase in provisions, the cost of oil and gas properties will be increased accordingly; for a decrease
+in provisions, the cost of oil and gas properties will be deducted within the limit of the carrying amount of assets related
+to decommissioning expenses. If a decrease in the provision exceeds the carrying amount of the oil and gas properties
+recognised corresponding to the provision, the excess shall be recognised immediately in profit or loss.
+4 FINANCIAL RISK AND CAPITAL MANAGEMENT
+234 PETROCHINA COMPANY LIMITED
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+(vii) A person identified in (a)(i) has significant influence over the entity or is a member of the key management
+personnel of the entity (or of a parent of the entity).
+(viii) The entity, or any member of a group of which it is a part, provides key management personnel services to
+the Group or to the Group's parent.
+Close members of the family of a person are those family members who may be expected to influence, or be
+influenced by, that person in their dealings with the entity.
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+4.1 Financial risk factors
+FINANCIAL STATEMENTS PetroChina
+The Group's activities expose it to a variety of financial risks, including market risk, credit risk and liquidity risk.
+Market risk is the possibility that changes in foreign exchange rates, interest rates and the prices of oil and gas
+products will adversely affect the value of assets, liabilities and expected future cash flows.
+(i) Foreign exchange risk
+The Group conducts its domestic business primarily in RMB, but maintains a portion of its assets in other currencies
+to pay for imported crude oil, natural gas, imported equipment and other materials and to meet foreign currency financial
+liabilities. The Group is exposed to currency risks arising from fluctuations in various foreign currency exchange rates
+against the RMB. The RMB is not a freely convertible currency and is regulated by the PRC government. Limitations on
+foreign exchange transactions imposed by the PRC government could cause future exchange rates to vary significantly
+from current or historical exchange rates.
+Additionally, the Group operates internationally and foreign exchange risk arises from future acquisitions and
+commercial transactions, recognised assets and liabilities and net investments in foreign operations. Certain entities in
+the Group might use currency derivatives to manage such foreign exchange risk.
+(ii) Interest rate risk
+The Group has no significant interest rate risk on interest-bearing assets. The Group's exposure to interest rate risk
+arises from its borrowings. The Group's borrowings at floating rates expose the Group to cash flow interest rate risk and
+its borrowings at fixed rates expose the Group to fair value interest rate risk. However, the exposure to interest rate risk is
+not material to the Group. A detailed analysis of the Group's borrowings, together with their respective interest rates and
+maturity dates, is included in Note 29.
+236
+PETROCHINA COMPANY LIMITED
+(a) Market risk
+Provision for onerous contracts is measured at the present value of the lower of the expected cost of terminating
+the contract and the expected net cost of continuing with the contract. Before a provision is established, the Group
+recognises any impairment loss on the assets associated with that contract.
+235
+(vi) The entity is controlled or jointly controlled by a person identified in (a).
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+(z) Research and development
+Research expenditure incurred is recognised as an expense. Costs incurred on development projects are
+recognised as intangible assets to the extent that such expenditure is expected to generate future economic benefits.
+(aa) Retirement benefit plans
+The Group contributes to various employee retirement benefit plans organised by PRC municipal and provincial
+governments under which it is required to make monthly contributions to these plans at prescribed rates for its
+employees in China. The relevant PRC municipal and provincial governments undertake to assume the retirement benefit
+obligations of existing and future retired employees of the Group in China. The Group has similar retirement benefit plans
+for its employees in its overseas operations. Contributions to these PRC and overseas plans ("defined contribution plan")
+are charged to expense as incurred. In addition, the Group joined the corporate annuity plan approved by relevant PRC
+authorities. Contribution to the annuity plan is charged to expense as incurred. The Group currently has no additional
+material obligations outstanding for the payment of retirement and other post-retirement benefits of employees in the
+PRC or overseas other than what described above.
+(ab) Related parties
+2021 ANNUAL REPORT
+(a) A person, or a close member of that person's family, is related to the Group if that person:
+(ii) has significant influence over the Group; or
+(iii) is a member of the key management personnel of the Group or the Group's parent.
+(b) An entity is related to the Group if any of the following conditions applies:
+(i) The entity and the Group are members of the same group (which means that each parent, subsidiary and
+fellow subsidiary is related to the others).
+(ii) One entity is an associate or joint venture of the other entity (or an associate or joint venture of a member of a
+group of which the other entity is a member).
+(iii) Both entities are joint ventures of the same third party.
+(iv) One entity is a joint venture of a third entity and the other entity is an associate of the third entity.
+(v) The entity is a post-employment benefit plan for the benefit of employees of either the Group or an entity
+related to the Group.
+(i) has control or joint control over the Group;
+PETROCHINA COMPANY LIMITED
+(All amounts in RMB millions unless otherwise stated)
+2021 ANNUAL REPORT 231
+(All amounts in RMB millions unless otherwise stated)
+Loss allowances for financial assets measured at amortised cost are deducted from the gross carrying amount of
+the assets. Impairment losses on trade and other receivables are presented under 'Selling, general and administrative
+expenses', similar to the presentation under IAS 39.
+The gross carrying amount of a financial asset is written off when the Group has no reasonable expectations of
+recovering a financial asset in its entirety or a portion thereof. For customers, the Group individually makes an assessment
+with respect to the timing and amount of write-off based on whether there is a reasonable expectation of recovery. The
+Group expects no significant recovery from the amount written off. However, financial assets that are written off could still
+be subject to enforcement activities in order to comply with the Group's procedures for recovery of amounts due.
+(m) Leases
+(a) As a lessee
+The Group recognises a right-of-use asset and a lease liability at the lease commencement date. The right-of-use
+asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments
+made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle
+and remove the underlying asset or to restore the underlying asset or the site on which it is located, less any lease
+incentives received.
+The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date
+to the end of the lease term, unless the lease transfers ownership of the underlying asset to the Group by the end of the
+lease term or the cost of the right-of-use asset reflects that the Group will exercise a purchase option. In that case the
+right-of-use asset will be depreciated over the useful life of the underlying asset, which is determined on the same basis
+as those of property and equipment. In addition, the right-of-use asset is periodically reduced by impairment losses, if
+any, and adjusted for certain remeasurements of the lease liability.
+The lease liability is initially measured at the present value of the lease payments that are not paid at the
+commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined,
+the Group's incremental borrowing rate. Generally, the Group uses its incremental borrowing rate as the discount rate.
+228
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+Lease payments included in the measurement of the lease liability comprise the following:
+- fixed payments, including in-substance fixed payments;
+- variable lease payments that depend on an index or a rate, initially measured using the index or rate as at the
+commencement date;
+- amounts expected to be payable under a residual value guarantee; and
+NOTES TO THE FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS PetroChina
+227
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+Financial liabilities
+The Group derecognises a financial liability when its contractual obligations are discharged or cancelled, or expire.
+The Group also derecognises a financial liability when its terms are modified and the cash flows of the modified liability
+are substantially different, in which case a new financial liability based on the modified terms is recognised at fair value.
+On derecognition of a financial liability, the difference between the carrying amount extinguished and the
+consideration paid (including any non-cash assets transferred or liabilities assumed) is recognised in profit or loss.
+(d) Offsetting
+Financial assets and financial liabilities are offset and the net amount presented in the consolidated statement of
+financial position when, and only when, the Group currently has a legally enforceable right to set off the amounts and it
+intends either to settle them on a net basis or to realise the asset and settle the liability simultaneously.
+the exercise price under a purchase option that the Group is reasonably certain to exercise, lease payments in
+an optional renewal period if the Group is reasonably certain to exercise an extension option, and penalties for early
+termination of a lease unless the Group is reasonably certain not to terminate early.
+(1) Impairment for financial assets
+- financial assets measured at amortised cost;
+- debt investments measured at FVOCI; and
+- contract assets.
+The Group measures loss allowances at an amount equal to lifetime ECLs, except for the financial assets for which
+credit risk (i.e. the risk of default occurring over the expected life of the financial instrument) has not increased significantly
+since initial recognition, which are measured as 12-month ECLs. When determining whether the credit risk of a financial
+asset has increased significantly since initial recognition and when estimating ECLs, the Group considers reasonable and
+supportable information that is relevant and available without undue cost or effort.
+Loss allowances for accounts receivable are always measured at an amount equal to lifetime ECLs. The maximum
+period considered when estimating ECLs is the maximum contractual period over which the Group is exposed to credit
+risk.
+ECLS are a probability-weighted estimate of credit losses. Credit losses are measured as the present value of all
+cash shortfalls (i.e. the difference between the cash flows due to the Group in accordance with the contract and the cash
+flows that the Group expects to receive). ECLs are discounted at the effective interest rate of the financial asset.
+At each reporting date, the Group assesses whether financial assets carried at amortised cost and debt securities at
+FVOCI are credit-impaired. A financial asset is 'credit-impaired' when one or more events that have a detrimental impact
+on the estimated future cash flows of the financial asset have occurred.
+2021 ANNUAL REPORT
+The Group recognises loss allowances for expected credit losses ("ECLS") on:
+The lease liability is measured at amortised cost using the effective interest method. It is remeasured when there is a
+change in future lease payments arising from a change in an index or rate, if there is a change in the Group's estimate of
+the amount expected to be payable under a residual value guarantee, if the Group changes its assessment of whether it
+will exercise a purchase, extension or termination option or if there is a revised in-substance fixed lease payment.
+When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of
+the right-of-use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to
+zero.
+recognised.
+230
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+(p) Contract assets and contract liabilities
+A contract asset is recognised when the Group recognises revenue before being unconditionally entitled to the
+consideration under the payment terms set out in the contract. Contract assets are assessed for ECLs in accordance
+with the policy set out in Note 3(1) and are reclassified to receivables when the right to the consideration has become
+unconditional (Note 3(q)).
+Amortisation of capitalised contract costs is charged to profit or loss when the revenue to which the asset relates is
+A contract liability is recognised when the customer pays consideration before the Group recognises the related
+revenue. A contract liability would also be recognised if the Group has an unconditional right to receive consideration
+before the Group recognises the related revenue. In such cases, a corresponding receivable would also be recognised
+(Note 3(q)).
+(q) Accounts receivable
+Accounts receivable are recognised when the Group has an unconditional right to receive consideration. A right to
+receive consideration is unconditional if only the passage of time is required before payment of that consideration is due
+(Note 3(p)).
+3(1)).
+Receivables are stated at amortised cost using the effective interest method less allowance for credit losses (Note
+(r) Cash and cash equivalents
+Cash and cash equivalents comprise cash in hand, deposits held with banks and highly liquid investments with
+original maturities of three months or less from the time of purchase.
+(s) Accounts payable
+Accounts payable are recognised initially at fair value and subsequently measured at amortised cost unless the
+effect of discounting would be immaterial, in which case they are stated at cost.
+When the contract includes a significant financing component, the contract balance includes interest accrued under
+the effective interest method (Note 3(v)).
+FINANCIAL STATEMENTS PetroChina
+Capitalised contract costs are stated at cost less accumulated amortisation and impairment losses. Impairment
+losses are recognised to the extent that the carrying amount of the contract cost asset exceeds the net of (i) remaining
+amount of consideration that the Group expects to receive in exchange for the goods or services to which the asset
+relates, less (ii) any costs that relate directly to providing those goods or services that have not yet been recognised as
+expenses.
+Incremental costs of obtaining a contract are those costs that the Group incurs to obtain a contract with a customer
+that it would not have incurred if the contract had not been obtained. Incremental costs of obtaining a contract are
+capitalised when incurred if the costs relate to revenue which will be recognised in a future reporting period and the
+costs are expected to be recovered, unless the expected amortisation period is one year or less from the date of initial
+recognition of the asset, in which case the costs are expensed when incurred. Other costs of obtaining a contract are
+expensed when incurred.
+The Group present right-of-use assets and lease liabilities separately in the statement of financial position.
+The Group has elected not to recognise right-of-use assets and lease liabilities for leases of low-value assets and
+short-term leases. The Group recognises the lease payments associated with these leases as an expense on a straight-
+line basis over the lease term.
+Payments made to the Ministry of Natural Resources to secure land use rights (excluding mineral properties) are
+treated as leases.
+(b) As a lessor
+At inception or on modification of a contract that contains a lease component, the Group allocates the consideration
+in the contract to each lease component on the basis of their relative stand-alone prices.
+When the Group acts as a lessor, it determines at lease inception whether each lease is a finance lease or an
+operating lease.
+To classify each lease, the Group makes an overall assessment of whether the lease transfers substantially all of the
+risks and rewards incidental to ownership of the underlying asset. If this is the case, then the lease is a finance lease; if
+not, then it is an operating lease. As part of this assessment, the Group considers certain indicators such as whether the
+lease is for the major part of the economic life of the asset. There are no significant finance lease for the Group.
+2021 ANNUAL REPORT
+Costs to fulfil a contract are capitalised if the costs relate directly to an existing contract or to a specifically
+identifiable anticipated contract; generate or enhance resources that will be used to provide goods or services in the
+future; and are expected to be recovered.
+229
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+If an arrangement contains lease and non-lease components, then the Group applies IFRS 15 to allocate the
+consideration in the contract.
+The Group recognises lease payments received under operating leases as income on a straight-line basis over the
+lease term as part of "other revenue".
+(n) Inventories
+Inventories include oil products, chemical products and crude oil and other raw materials and supplies which are
+stated at the lower of cost and net realisable value. Cost is primarily determined by the weighted average cost method.
+The cost of finished goods comprises raw materials, direct labour, other direct costs and related production overheads,
+but excludes borrowing costs. Net realisable value is the estimated selling price in the ordinary course of business, less
+the cost of completion and directly attributable marketing and distribution costs.
+(o) Contract costs
+Contract costs are either the incremental costs of obtaining a contract with a customer or the costs to fulfil a
+contract with a customer which are not capitalised as inventory (Note 3(n)), property, plant and equipment (Note 3(g)), oil
+and gas properties (Note 3(h)) or intangible assets (Note 3(i)).
+FINANCIAL STATEMENTS PetroChina
+At commencement or on modification of a contract that contains a lease component, the Group allocates the
+consideration in the contract to each lease component on the basis of its relative stand-alone prices.
+3,155
+3,155
+832,229
+939,775
+8,337
+(i) Other income, net primarily includes dividend income from equity investments measured at fair value through other
+comprehensive income, gain on Pipeline restructuring and disposal of investment in subsidiaries, loss on disposal of property,
+plant and equipment and government grants.
+(ii) The auditors' remuneration above represents the annual audit fees paid by the Company. This remuneration does not include
+fees of RMB 41 (2020: RMB 62) paid by subsidiaries to the Company's current auditor and its network firms which primarily
+relates to audit, tax compliance and other advisory services.
+2021 ANNUAL REPORT 243
+FINANCIAL STATEMENTS PetroChina
+PETROCHINA COMPANY LIMITED
+656
+NOTES TO THE FINANCIAL STATEMENTS
+8 EMPLOYEE COMPENSATION COSTS
+Wages, salaries and allowances
+Social security costs
+2021
+2020
+RMB
+(All amounts in RMB millions unless otherwise stated)
+RMB
+Write down in inventories
+16,729
+13,916
+49
+Cost of inventories recognised as expense
+2,047,256
+1,527,271
+Provision for impairment of receivables
+775
+15,746
+438
+18,959
+5,398
+Variable lease payments, low-value and short-term lease payment not
+included in the measurement of lease liabilities
+2,645
+3,362
+Research and development expenses
+Loss on disposal and scrap of property, plant and equipment (i)
+47
+100,971
+53,864
+154,835
+11,660
+9,882
+Crude oil special gain levy
+4,655
+178
+Urban and township land use tax
+Educational surcharge
+3,572
+Other
+6,692
+4,562
+228,003
+195,850
+10 INTEREST EXPENSE
+3,588
+98,832
+13,647
+City maintenance and construction tax
+48,772
+147,604
+Social security costs mainly represent contributions to plans for staff welfare organised by the PRC municipal and
+provincial governments and others, including contributions to the retirement benefit plans (Note 34).
+9 TAXES OTHER THAN INCOME TAXES
+2021
+2020
+16,078
+RMB
+Consumption tax
+161,623
+145,525
+Resource tax
+23,723
+18,468
+RMB
+Interest on
+Auditors' remuneration (ii)
+194,015
+customers
+92,906
+Other revenue
+231
+Total
+93,137
+Revenue from contracts with
+281,946
+162
+282,108
+257
+334,933
+401
+2,195
+1,932,753
+1,221,030
+335,334
+1,220,773
+32
+2,227
+1,200,722
+732,031
+65,878
+93,137
+282,108
+1,221,030
+335,334
+2,227
+1,933,836
+666,153
+Geographical Region
+27,028
+281,946
+554,620
+334,933
+2,195
+Others
+China's mainland
+14,388
+1,083
+242 PETROCHINA COMPANY LIMITED
+Gain on disposal of investment in subsidiaries (i)
+3,575
+1,242
+18,320
+46,946
+Gain on Pipeline restructuring (i)
+186
+Charged
+Depreciation and impairment losses:
+Owned property, plant and equipment
+Right-of-use assets
+5,774
+5,944
+211,107
+Amortisation of intangible and other assets
+1,933,836
+76
+95
+7 PROFIT BEFORE INCOME TAX EXPENSE
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+2021
+RMB
+2020
+Reversal of write down in inventories
+RMB
+Credited
+Dividend income from equity investments measured at fair value through
+other comprehensive income (i)
+17
+25
+Reversal of provision for impairment of receivables
+360
+Items credited and charged in arriving at the profit before income tax
+expense include:
+Bank loans
+Other loans
+Lease liabilities
+Mr. Zhang Fengshan
+Mr. Jiang Lifu
+Mr. Lu Yaozhong
+Mr. Wang Liang
+Mr. Fu Suotang
+Mr. Li Jiamin
+Mr. Xu Wenrong (V)
+Mr. Li Wendong (vi)
+1,325
+108
+1,433
+1,367
+1,109
+146
+Mr. Liu Xianhua
+1,255
+Mr. Lv Bo (v)
+2,969
+331
+Mr. Simon Henry
+499
+499
+320
+Mr. Cai Jinyong (iv)
+Supervisors:
+575
+Mr. Jiang Xiaoming (iv)
+575
+575
+2,732
+196
+41
+575
+527
+1,006
+35
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+(i) Mr. Wang Yilin ceased being the chairman from January 19, 2020. Mr. Dai Houliang was elected as the chairman and Mr.
+Li Fanrong was elected as the vice chairman from March 25, 2020. Mr. Li Fanrong ceased being the vice chairman and the
+director from May 10, 2021.
+(ii) Mr. Hou Qijun and Mr. Ren Lixin was appointed as director from October 21, 2021; and Mr. Hou Qijun was appointed as Vice
+chairman from October 28, 2021.
+Mr. Duan Liangwei was appointed as the president and executive director from March 9, 2020; On March 25, 2021, Mr. Duan
+Liangwei resigned as the Company's president and was transferred from an executive director to a non-executive director, and
+no longer received remuneration from the Company; Mr. Huang Yongzhang was appointed as the Company's president and
+the executive director.
+FINANCIAL STATEMENTS PetroChina
+(iv) Mr. Cai Jinyong and Mr. Jiang Xiaoming were elected as independent non-executive directors from June 11, 2020, and began
+to perform their duties. The remuneration had not been paid at the end of December 31, 2020. Mr. Zhang Biyi and Mr. Lin
+Boqiang ceased being the independent non-executive director from June 11, 2020.
+(vi) On May 28, 2021, Mr. Li Wendong resigned as the employee representative supervisor of the Company.
+(vii) The emoluments above are all pre-tax amounts.
+None of the directors and supervisors has waived their remuneration during the years ended December 31, 2021
+and 2020.
+The five highest paid individuals in the Company for the year ended December 31, 2021 included one supervisor
+whose emolument is reflected in the analysis shown above and the note; and four senior management whose allowances
+and other benefits were RMB 1.533, RMB 1.310, RMB 1.308 and RMB 1.257, respectively, and whose contribution
+to retirement benefit scheme were RMB 0.164, RMB 0.164, RMB 0.164 and RMB 0.164, respectively. The five highest
+paid individuals in the Company for the year ended December 31, 2020 included one supervisor whose emolument is
+reflected in the analysis shown above and the note; and four senior management whose allowances and other benefits
+were RMB 1.550, RMB 1.310, RMB 1.292 and RMB 1.270, respectively, and whose contribution to retirement benefit
+scheme were RMB 0.116, RMB 0.116, RMB 0.116 and RMB 0.116, respectively.
+During the years ended December 31, 2021 and 2020, the Company did not incur any severance payment to any
+director for loss of office or any payment as inducement to any director to join the Company.
+246 PETROCHINA COMPANY LIMITED
+(v) Mr. Xu Wenrong ceased being the Chairman of the Supervisory Committee and supervisor and Mr. Lv Bo ceased being the
+non-executive director from October 20, 2020. Mr. Lv Bo was elected as the Chairman of the Supervisory Committee and
+supervisor from November 5, 2020.
+102
+245
+7,080
+137
+1,193
+847
+98
+945
+1,011
+2021 ANNUAL REPORT
+3,383
+3,770
+4,577
+2,732
+4,223
+608
+7,563
+387
+527
+Mr. Tokuchi Tatsuhito
+331
+19,739
+26,528
+Amounts capitalised are borrowing costs that are attributable to the construction of qualifying assets. The average
+interest rate used to capitalise such general borrowing cost was 4.19% per annum for the year ended December 31,
+2021 (2020: 4.23% per annum).
+244 PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(895)
+(All amounts in RMB millions unless otherwise stated)
+Details of the emoluments of directors and supervisors for the years ended December 31, 2021 and 2020 are as
+follows:
+Name
+Chairmen:
+Mr. Dai Houliang (i)
+Mr. Wang Yilin (i)
+11 EMOLUMENTS OF DIRECTORS AND SUPERVISORS
+Vice chairmen:
+(1,008)
+20,747
+Accretion expense (Note 33)
+Less: Amounts capitalised
+2021
+2020
+RMB
+RMB
+27,423
+2,540
+8,092
+14,342
+5,419
+6,297
+4,696
+5,107
+1,677
+Mr. Hou Qijun (ii)
+Fee for
+directors and
+supervisors
+RMB'000
+2021
+Salaries,
+allowances and
+other benefits
+RMB'000
+Mr. Duan Liangwei (iii)
+Mr. Liu Yuezhen
+Mr. Jiao Fangzheng
+196
+41
+237
+Non-executive directors:
+735
+388
+Mr. Zhang Biyi
+398
+Ms. Elsie Leung Oi-sie
+556
+556
+Mr. Lin Boqiang
+824
+180
+644
+2020
+Contribution
+to retirement
+benefit scheme
+RMB'000
+Total
+RMB'000
+Total
+RMB'000
+Mr. Li Fanrong (i)
+Executive directors:
+Mr. Huang Yongzhang (iii)
+505
+124
+629
+Mr. Ren Lixin (ii)
+139
+56
+195
+Total
+1,083
+2,503
+401
+- Derivative financial liabilities
+1,411
+8,076
+8,076
+653
+249
+Accounts payable and accrued liabilities:
+902
+1,173
+8,325
+10,389
+2,813
+896
+2,813
+891
+896
+Liabilities
+- Bills receivable
+As of December 31, 2020, financial assets and financial liabilities continuing to be measured at fair value are listed
+as follows in three levels:
+Assets
+Level 1
+RMB
+Level 2
+Level 3
+Total
+- Other investments
+RMB
+RMB
+Accounts receivable:
+- Derivative financial assets
+238
+1,173
+Financial assets at fair value through other comprehensive income:
+RMB
+3,881
+3,709
+The Group uses discounted cash flow model with inputted interest rate and commodity index, which were
+influenced by historical fluctuation and the probability of market fluctuation, to evaluate the fair value of the bills receivable
+classified as Level 3 financial assets.
+(All amounts in RMB millions unless otherwise stated)
+According to changes in the internal and external environment, accounting standards and company asset
+retirement expense measures and other relevant regulations, oil and gas field companies recalculate their asset retirement
+obligations of oil and gas properties based on the latest parameters to more objectively reflect the actual situation of the
+Company's asset retirement obligation of oil and gas properties.
+6 REVENUE
+Revenue represents revenues from the sale of crude oil, natural gas, refined products, chemical products, non-oil
+products, etc., and from the transportation of crude oil, refined products and natural gas. Revenue from contracts with
+customers is mainly recognised at a point in time. The revenue information for the year ended December 31, 2021 and
+2020 are as follows:
+2021
+Type of contract
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+Type of goods and services
+Natural gas
+Refined products
+Exploration
+and
+Production
+Refining
+and
+Chemicals
+Marketing
+Natural Gas
+and Pipeline
+Crude oil
+3,709
+FINANCIAL STATEMENTS
+Provision is recognised for the future decommissioning and restoration of oil and gas properties. The amount
+of the provision recognised is the present values of the estimated future expenditures. The estimation of the future
+expenditures is based on current local conditions and requirements, including legal requirements, technology, price
+levels, etc. In addition to these factors, the present values of these estimated future expenditures are also impacted by
+the management plan for the decommissioning of oil and gas properties, the estimation of the economic lives of oil and
+gas properties and estimates of discount rates. The estimations and underlying assumptions are reviewed on an ongoing
+basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision
+affects only that period, or in the period of the revision and future periods if the revision affects both current and future
+period. Changes in any of these estimates will impact the operating results and the financial position of the Group over
+the remaining economic lives of the oil and gas properties.
+2021 ANNUAL REPORT
+239
+FINANCIAL STATEMENTS PetroChina
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+240 PETROCHINA COMPANY LIMITED
+5 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS
+The matters described below are considered to be the most critical in understanding the estimates and judgements
+that are involved in preparing the Group's consolidated financial statements.
+(a) Estimation of oil and gas reserves
+Estimates of oil and natural gas reserves are key elements in the Group's investment decision-making process.
+They are also important elements in testing impairment of property, plant and equipment (Note 5(b)). Changes in proved
+oil and gas reserves, particularly proved developed reserves, will affect unit-of-production depreciation, depletion and
+amortisation recorded in the consolidated financial statements for property, plant and equipment relating to oil and gas
+production activities. An increase/reduction in proved developed reserves will decrease/increase depreciation, depletion
+and amortisation charges. Proved oil and gas reserves estimates are subject to revision, either upward or downward,
+based on new information, such as from development drilling and production activities or from changes in economic
+factors, including product prices, contract terms, evolution of technology or development plans, etc.
+(b) Estimation of impairment of property, plant and equipment
+Property, plant and equipment, including oil and gas properties, are reviewed for possible impairments when events
+or changes in circumstances indicate that the carrying amount may not be recoverable. Determination as to whether and
+how much an asset is impaired involves management estimates and judgements such as the future price of crude oil,
+natural gas, refined and chemical products, the operation costs, the product mix, production volumes, production profile
+and the oil and gas reserves. The impairment reviews and calculations are based on assumptions that are consistent with
+the Group's business plans taking into account current economic conditions. Favourable changes to some assumptions,
+may allow the Group to avoid the need to impair any assets or make it necessary to reverse an impairment loss
+recognised in prior periods, whereas unfavourable changes may cause the assets to become impaired. For example,
+when the assumed future price and production profile of crude oil used for the expected future cash flows are different
+from the actual price and production profile of crude oil respectively experienced in future, the Group may either over or
+under recognise the impairment losses for certain assets.
+(c) Estimation of asset retirement obligations
+Estimates and judgements are regularly evaluated and are based on historical experience and other factors,
+including expectations of future events that are believed to be reasonable under the circumstances.
+Head
+Office and
+Other
+3,881
+726
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+(c) Liquidity risk
+Liquidity risk is the risk that the Group will encounter difficulty in meeting obligations associated with financial
+liabilities.
+FINANCIAL STATEMENTS PetroChina
+In managing its liquidity risk, the Group has access to funding at market rates through equity and debt markets,
+including using undrawn committed borrowing facilities to meet foreseeable borrowing requirements.
+Analysis of the Group's borrowings and lease liabilities based on the remaining period at the date of the statement
+of financial position to the contractual maturity dates is presented in Note 29 and Note 20.
+4.2 Capital management
+The Group monitors capital on the basis of the gearing ratio which is calculated as interest-bearing borrowings /
+(interest-bearing borrowings + total equity), interest-bearing borrowings include short-term and long-term borrowings.
+The gearing ratio at December 31, 2021 is 19.5% (2020: 21.3%).
+4.3 Fair value estimation
+The methods and assumptions applied in determining the fair value of each class of financial assets and financial
+liabilities of the Group at December 31, 2021 and 2020 are disclosed in the respective accounting policies.
+The carrying amounts of the following financial assets and financial liabilities approximate their fair value as all of
+them are short-term in nature: cash and cash equivalents, time deposits with maturities over three months but within one
+year, accounts receivable, other receivables, trade payables, other payables and short-term borrowings. The fair values of
+fixed rate long-term borrowings are likely to be different from their respective carrying amounts. Analysis of the fair values
+and carrying amounts of long-term borrowings is presented in Note 29.
+Given the low level of gearing and continued access to funding, the Group believes that its liquidity risk is not
+material.
+The Group's investments in derivative financial instruments and FVOCI are measured at fair value on the balance
+sheet date. The fair value of derivative financial instruments are mainly categorised into Level 1 and Level 2 of the fair
+value hierarchy, which are based on the unadjusted quoted prices in active markets for identical assets or liabilities as
+inputs used in the valuation techniques, or the inputs other than quoted prices included within Level 1 that are observable
+either directly or indirectly. Trade accounts receivable and bills receivable in FVOCI are mainly categorised into Level 3 of
+the fair value hierarchy, which are based on that trade accounts receivable and bills receivable are mainly short-term bills
+of acceptance issued by banks, their fair values approximate the face values of the bills. The equity investments in FVOCI
+that are not held for trading are measured at fair value at the end of the reporting period. The fair value of such equity
+investments are mainly categorised into Level 1 of the fair value hierarchy, which are based on the unadjusted quoted
+prices in active markets for identical assets or liabilities as inputs used in the valuation techniques.
+237
+The Group has no significant concentration of credit risk.
+32
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+(iii) Price risk
+The Group is engaged in a wide range of oil and gas products-related activities. Prices of oil and gas products are
+affected by a wide range of global and domestic factors which are beyond the control of the Group. The fluctuations in
+such prices may have favourable or unfavourable impacts on the Group.
+2021 ANNUAL REPORT
+The Group uses derivative financial instruments, including commodity futures, commodity swaps and commodity
+options, to hedge some price risks efficiently.
+As at 31 December 2021, it is estimated that a general increase/decrease of USD 10 per barrel in basic price of
+derivative financial instruments, with all other variables held constant, would impact the fair value of derivative financial
+instruments, which would increase/decrease the Group's profit for the year by approximately RMB 2,104 (2020:
+decrease/increase RMB 2,578), there is no effect on the Group's other reserves (2020: Nil). This sensitivity analysis
+has been determined assuming that the change in prices had occurred at the balance sheet date and the change was
+applied to the Group's derivative financial instruments at that date with exposure to commodity price risk.
+(b) Credit risk
+Credit risk arises from cash and cash equivalents, time deposits with banks, accounts receivable, prepayments and
+other current assets and intangible and other non-current assets.
+A substantial portion of the Group's cash at bank and time deposits are placed with the major state-owned banks
+and financial institutions in China and management believes that the credit risk is low.
+The Group performs ongoing assessment of the credit quality of its customers and sets appropriate credit limits
+taking into account the financial position and past history of defaults of customers. The aging analysis of accounts
+receivable (net of impairment of accounts receivable) is presented in Note 23.
+The carrying amounts of cash and cash equivalents, time deposits placed with banks, accounts receivable,
+prepayments and other current assets and financial assets at fair value through other comprehensive income included in
+the consolidated statement of financial position represent the Group's maximum exposure to credit risk. No other financial
+assets carry a significant exposure to credit risk.
+As at 31 December 2021, the Group had certain commodity contracts of crude oil, refined oil products and
+chemical products designated as hedges. As at 31 December 2021, the fair value of such derivative hedging financial
+instruments is derivative financial assets of RMB 3,913 (2020: RMB 1,411) and derivative financial liabilities of RMB 3,881
+(2020: RMB 3,709).
+726
+238
+FINANCIAL STATEMENTS
+- Other investments
+Liabilities
+Accounts payable and accrued liabilities:
+- Derivative financial liabilities
+3,913
+3,975
+- Bills receivable
+3,975
+263
+1,168
+3,530
+1,288
+4,238
+9,056
+905
+PETROCHINA COMPANY LIMITED
+Financial assets at fair value through other comprehensive income:
+2,625
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+As of December 31, 2021, financial assets and financial liabilities continuing to be measured at fair value are listed
+as follows in three levels:
+Assets
+Level1
+Level2
+1,288
+Level3
+RMB
+RMB
+RMB
+RMB
+Accounts receivable:
+- Derivative financial assets
+Total
+Total
+The Group's objectives when managing capital are to safeguard its ability to continue as a going concern, optimise
+returns for owners and to minimise its cost of capital. In meeting its objectives of managing capital, the Group may issue
+new shares, adjust its debt levels or the mix between short-term and long-term borrowings.
+685,743
+Type of goods and services
+Crude oil
+333,557
+447,384
+780,941
+Natural gas
+Total
+118,388
+294,297
+586,381
+Refined products
+616,063
+822,192
+1,438,255
+173,696
+Chemical products
+Office and
+Other
+Marketing
+1,207
+2,614,349
+2021 ANNUAL REPORT
+241
+FINANCIAL STATEMENTS PetroChina
+PETROCHINA COMPANY LIMITED
+Natural Gas
+and Pipeline
+NOTES TO THE FINANCIAL STATEMENTS
+2020
+Exploration
+and
+Type of contract
+Production
+Refining
+and
+Chemicals
+Head
+(All amounts in RMB millions unless otherwise stated)
+2,613,142
+Pipeline transportation
+150,296
+(1,243,597)
+Revenue from contracts with
+customers
+92,906
+281,946
+1,220,773
+(1,320)
+334,933
+1,932,753
+Other revenue
+231
+162
+464,298
+257
+2,195
+business
+(35,437)
+23,800
+30,344
+180,640
+52,273
+52,273
+Non-oil sales in gas stations
+22,360
+3,515
+22,360
+78,631
+8,254
+Intersegment elimination
+(437,670)
+(492,667)
+1,300
+(276,503)
+Others
+2,670
+23
+2,693
+115,500
+1,772,577
+90,539
+Intersegment elimination
+(571,705)
+7,072
+(650,018)
+1,272
+(397,485)
+32,208
+(19,526)
+Others
+3,871
+(1,201)
+(1,639,935)
+Revenue from contracts with
+customers
+116,280
+324,776
+1,772,004
+134,962
+25,148
+3,360
+25,148
+133,148
+397,496
+1,150,041
+344,196
+381,370
+759,912
+1,064,890
+858,714
+1,824,802
+Chemical products
+Pipeline transportation
+business
+48,240
+256,050
+3,360
+Non-oil sales in gas stations
+397,412
+Other revenue
+207,810
+178
+2,670
+1,625,414
+987,728
+Revenue from contracts with
+customers
+116,280
+Other revenue
+397,412
+324,776
+178
+397,412
+84
+324,954
+349
+Total
+116,629
+1,772,004
+573
+47,953
+349
+397,496
+Others
+116,629
+324,954
+84
+1,772,577
+2,670
+23
+2,693
+2,613,142
+Total
+Geographical Region
+China's mainland
+68,327
+324,776
+1,207
+2,614,349
+573
+904
+1,532
+1,823
+1,989
+677
+191
+Dividends received by the Group
+6,846
+943
+207
+389
+6,444
+389
+424
+6,216
+5,698
+29,778
+Total comprehensive income
+(1,603)
+424
+78
+(606)
+2
+Other comprehensive income/(loss)
+Group's share of total comprehensive
+income
+74
+31, 2021
+PETROCHINA COMPANY LIMITED
+50.00
+50.00
+50.00
+50.00
+7,819
+Percentage ownership interest (%)
+RMB
+RMB
+RMB
+RMB
+RMB
+RMB
+252
+31, 2020
+31, 2020
+December December
+December December
+Trans-Asia Gas Pipeline
+Co., Ltd.
+B.V.
+Mangistau Investment
+China Marine Bunker
+(PetroChina) Co., Ltd.
+December December
+31, 2021 31, 2020
+Summarised statement of financial position as included in their own financial statements, adjusted for fair value
+adjustments and differences in accounting policies in respect of the Group's principal joint ventures and reconciliation to
+carrying amount is as follows:
+(All amounts in RMB millions unless otherwise stated)
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+FINANCIAL STATEMENTS
+Interest in Joint Ventures
+31, 2021
+6,304
+157,346
+29,776
+151,135
+Carrying amount of interest in
+associates
+349
+349
+Goodwill
+3,281
+3,410
+23,765
+24,684
+151,135
+157,346
+Group's share of net assets
+25,033
+6,695
+74,267
+77,139
+570,282
+615,103
+Net assets
+2,776
+3,900
+12,617
+50.00
+8,396
+104,150
+103,243
+6,959
+6,444
+24,114
+3,281
+Profit for the year
+735
+1,510
+7,954
+12,691
+22,766
+101,572
+Revenue
+RMB
+RMB
+RMB
+RMB
+3,410
+RMB
+2020
+2021
+2020
+2021
+31, 2020
+2021
+2020 to Dec
+From Oct 01,
+CNPC Captive
+Insurance Co., Ltd.
+CP Finance
+PipeChina
+Summarised statement of comprehensive income and dividends received by the Group are as follow:
+RMB
+50.00
+Carrying amount of interest in joint
+ventures
+1,571
+2020
+2021
+2020
+2021
+2020
+2021
+Trans-Asia Gas Pipeline
+Co., Ltd.
+B.V.
+Mangistau Investment
+China Marine Bunker
+(PetroChina) Co., Ltd.
+Summarised statement of comprehensive income as included in their own financial statements, adjusted for fair
+value adjustments and differences in accounting policies and dividends received by the Group is as follows:
+20,065
+21,409
+3,917
+4,621
+1,336
+976
+20,065
+21,409
+3,917
+4,621
+1,336
+976
+Group's share of net assets
+40,130
+RMB
+RMB
+RMB
+RMB
+Interest expense
+42
+Non-current liabilities.
+31
+4
+3
+16
+11
+Interest income
+(38)
+(57)
+(1,048)
+42,818
+(1,002)
+(190)
+amortisation
+Depreciation, depletion and
+18
+17
+8,152
+11,543
+36,695
+58,210
+Revenue
+RMB
+RMB
+(195)
+Non-current assets
+7,833
+2,672
+3,008
+2,033
+158
+540
+Non-current liabilities
+739
+1,411
+74
+1,631
+1,343
+2,292
+equivalents
+Including: cash and cash
+2,886
+1,437
+830
+2,220
+7,319
+11,305
+Current assets
+39,809
+44,011
+10,586
+9,927
+1,685
+2,147
+2,330
+Including: Non-current financial
+liabilities
+1,952
+of the Company
+Net assets attributable to owners
+40,130
+42,818
+7,833
+9,242
+2,919
+2,339
+Net assets
+3,267
+5,810
+9,242
+other payables
+Including: Current financial
+235
+483
+575
+872
+5,927
+9,997
+Current liabilities
+2,330
+2,101
+848
+1
+liabilities excluding trade and
+4,752
+29,387
+404,201
+30,338
+Additions to capitalised exploratory well costs pending the determination of
+proved reserves
+36,101
+38,807
+At beginning of the year
+RMB
+RMB
+2020
+2021
+The following table indicates the changes to the Group's exploratory well costs, which are included in construction
+in progress, for the years ended December 31, 2021 and 2020.
+The Group's exploration and production segment determines whether there are any indicators of impairment for
+the oil fields or blocks and performs the impairment tests on those oil fields or blocks with indications of impairment, and
+reports the results to the Group's internal professional team (including exploration and finance expert) for further overall
+assessment and evaluation. The final results of the impairment tests have been submitted to the Group's management
+for review and approval. The Group recorded impairment losses amounting to RMB 19,463 related to oil and gas
+properties under the exploration and production segment for the year ended December 31, 2021 (2020: RMB 13,908)
+due to decline in oil and gas reserves in certain oilfield as well as no further development plans for certain other projects.
+The carrying amount of those impaired oil and gas properties was written down to their respective recoverable amounts,
+which were primarily determined using the discounted cash flow model. The Group referred to the weighted average
+cost of capital of the oil and gas industry when determining discount rate, and made relevant adjustments according to
+specific risks in different countries or regions. In 2021, the after-tax discount rates adopted by most oil fields or blocks of
+the Group ranged from 7.6% to 15.0% (2020: 5.9% to 12.0%) per annum.
+(All amounts in RMB millions unless otherwise stated)
+NOTES TO THE FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS PetroChina
+2021 ANNUAL REPORT 249
+1,452,091
+223,356
+13,077
+5,426
+258,295
+813,888
+138,049
+At end of the year
+Net book value
+30,104
+Reclassified to wells, facilities, and equipment based on the determination
+of proved reserves
+(27,201)
+(18,464)
+17 INVESTMENTS IN ASSOCIATES AND JOINT VENTURES
+(All amounts in RMB millions unless otherwise stated)
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+250
+Capitalised exploratory well costs over one year are principally related to the wells that are under further evaluation
+of drilling results or pending completion of development planning to ascertain economic viability.
+38,807
+29,387
+15,379
+10,033
+23,428
+14,825
+(2,195,939)
+19,354
+RMB
+December
+31, 2020
+December
+31, 2021
+Balance at December 31
+Over one year
+One year or less
+The following table provides an aging of capitalised exploratory well costs based on the date the drilling was
+completed.
+38,807
+At end of the year
+(8,934)
+(12,557)
+Capitalised exploratory well costs charged to expense
+RMB
+The summarised financial information of the Group's principal associates and joint ventures, including the
+aggregated amounts of assets, liabilities, revenue, profit or loss and the interest held by the Group were as follows:
+(10)
+(5,526)
+37
+(17,431)
+228,882 3,648,030
+Accumulated depreciation
+and impairment
+At beginning of the year
+Charge for the year and
+others
+(107,943) (1,429,389)
+(615,770) (19,947) (23,092)
+(6,233) (2,202,374)
+(11,005)
+Impairment charge
+(214)
+(136,433)
+(13,908)
+(45,912)
+(113)
+(1,260) (10,573)
+(205,183)
+(837)
+(295)
+(15,367)
+Disposals or write offs or
+transfers
+7,948
+24,234
+173,196
+3,739
+2,031
+(72)
+1,012
+(22,932)
+(1,074)
+(49) (746)
+22,857 45,014
+(1,086)
+746,404
+(488,109)
+490
+13,459
+(1,542,037)
+315
+(110,899)
+At end of the year
+differences
+Additions
+Transfers
+3,620
+16,827
+Disposals or write offs
+(22,910)
+1,044
+152,389
+(39,497)
+534
+(31,937)
+8,425
+23,618
+(438,169)
+36,155
+776
+(5,661)
+12,169
+(3,340)
+255,302
+188,591
+(205,003)
+3,985,598
+203,875
+(8,934)
+(518,511)
+Currency translation
+differences
+At end of the year
+(763)
+248,948
+(19,214)
+2,355,925
+27,148
+1,419
+859
+Interest Held
+Country of
+Incorporation
+December December
+December
+31, 2020
+31, 2021
+RMB
+RMB
+RMB
+December
+December
+31, 2020
+December
+31, 2021
+CNPC Captive Insurance
+Co., Ltd.
+CP Finance
+PipeChina
+Summarised financial information in respect of the Group's principal associates and reconciliation to carrying
+amount is as follows:
+Interest in Associates
+(All amounts in RMB millions unless otherwise stated)
+NOTES TO THE FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS PetroChina
+251
+2021 ANNUAL REPORT
+50.00
+50.00
+50.00
+49.00
+technology consulting
+promotion and
+31, 2021
+31, 2020
+RMB
+RMB
+446,369
+55,562
+136,150
+Current liabilities
+2,956
+2,618
+177,344
+116,765
+655,982
+768,161
+Non-current assets
+11,267
+development,
+9,100
+415,139
+74,012
+86,335
+Current assets
+49.00
+49.00
+32.00
+32.00
+29.90
+29.90
+Percentage ownership interest (%)
+RMB
+313,741
+Name
+advisory, technology
+consulting, enterprise
+bills acceptance
+settlement, lending,
+32.00
+Deposits, loans,
+8,331
+PRC
+China Petroleum Finance Co.,
+Ltd. ("CP Finance")
+technology
+promotion of
+technology transfer,
+technology service,
+technology consulting,
+of informatization,
+research, research
+and application
+import of equipment,
+import and export of
+techniques, science
+and technology
+storage service,
+29.90
+Pipeline transport,
+500,000
+PRC
+China Oil & Gas Piping Network
+Corporation ("PipeChina")
+Indirect %
+Direct %
+Principal Activities
+Registered
+Capital
+CNPC Captive Insurance Co.,
+Ltd.
+PRC
+5,000
+China Marine Bunker
+(PetroChina) Co., Ltd.
+investment
+management,
+investment
+investment holding,
+Main contractor,
+of oil and gas
+development and sale
+are exploration,
+main subsidiaries
+activities of its
+5,000
+PRC
+management
+Trans-Asia Gas Pipeline Co.,
+Ltd.
+Engages in investing
+USD 131
+million
+Netherlands
+Mangistau Investment B.V.
+transportation, sale
+and storage
+export trade and
+Oil import and
+insurance capital
+business
+Property loss insurance,
+liability insurance,
+credit insurance and
+deposit insurance; as
+well as the application
+of the above insurance
+reinsurance and
+discounting, guarantee
+and other banking
+business
+1,000
+PRC
+activities, the principle
+(60)
+138,441
+(160)
+Charge for the year and
+others
+(11,057)
+Impairment charge
+(516)
+(138,251)
+(19,463)
+(33,404)
+(2,723)
+(992) (2,485)
+(186,189)
+(121)
+(3,648)
+(26,471)
+Disposals or write offs or
+transfers
+1,952
+58,312
+7,429
+1,421
+997
+396
+70,507
+Currency translation
+differences
+103
+At end of the year
+(120,417)
+(2,195,939)
+(5,526)
+(17,431) (31,937)
+(488,109)
+(12,010)
+(1,588)
+(1,675)
+(22,175)
+(117,960)
+Currency translation
+differences
+(286)
+(7,255)
+(345)
+(11)
+At end of the year
+5,602
+(1,635,837)
+258,858
+778,003
+21,903
+(313)
+47,275
+(704)
+(8,914)
+232,282
+3,790,946
+Accumulated depreciation
+and impairment
+At beginning of the year
+(110,899)
+(1,542,037)
+2,452,625
+(75,411)
+158
+(516,649)
+401
+(33,145)
+1,561
+1
+9,202
+8,785
+the year
+Cash and cash equivalents at the end of
+8
+1,561
+13,074
+9,202
+beginning of the year
+Cash and cash equivalents at the
+1,553
+(1,560)
+(3,872)
+(417)
+equivalents
+Net (decrease)/increase in cash and cash
+(776)
+(15)
+Effect of foreign exchange rate changes
+on cash and cash equivalents
+(3,186)
+(3,995)
+7,410
+(8,531)
+256
+PETROCHINA COMPANY LIMITED
+1,153,616
+2,261,203
+167
+6,442
+(8,611) (2,331,650)
+Net book value
+At end of the year
+212,160
+816,788
+261,354
+4,912
+14,130
+223,671
+1,459,296
+11
+(16,991)
+Year Ended
+Buildings
+RMB
+Oil and
+Gas
+Properties
+RMB
+Equipment
+and
+Machinery
+RMB
+Construc-
+Motor
+Vehicles
+RMB
+Other
+RMB
+tion in
+Progress
+RMB
+Total
+RMB
+Cost
+At beginning of the year
+252,174
+December 31, 2020
+Net cash (outflow)/inflow from financing
+activities
+(5,101)
+269,790
+Effect of income taxes from international operations different from taxes at the PRC
+statutory tax rate
+2,692
+1,522
+Effect of preferential tax rate
+(8,603)
+(1,312)
+Tax effect of income not subject to tax
+(10,305)
+(3,612)
+Tax effect of expenses not deductible for tax purposes
+15,789
+5,455
+Tax effect of temporary differences and losses not recognised as deferred tax
+assets
+4,639
+6,261
+Income tax expense
+43,507
+22,588
+2021 ANNUAL REPORT
+247
+FINANCIAL STATEMENTS PetroChina
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+13 PROFIT ATTRIBUTABLE TO OWNERS OF THE COMPANY
+256
+(256)
+Tax return true-up
+14,018
+12 INCOME TAX EXPENSE
+Current taxes
+Deferred taxes (Note 32)
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+2021
+2020
+RMB
+RMB
+33,822
+14,922
+The profit attributable to owners of the Company in the consolidated financial statements of the Group is RMB
+92,170 for the year ended December 31, 2021 (2020: RMB 19,006).
+9,685
+43,507
+22,588
+In accordance with the relevant PRC income tax rules and regulations, the PRC corporate income tax rate
+applicable to the Group is principally 25%. In accordance with the Circular jointly issued by the Ministry of Finance ("MOF"),
+the General Administration of Customs of the PRC and the State Administration of Taxation ("SAT”) on Issues Concerning
+Tax Policies for In-depth Implementation of Western Development Strategy (Cai Shui [2011] No.58) and the Notice on
+Continuing the Income Tax Policy for Western Development (Notice No.23 of 2020 of the MOF, the SAT, the NDRC), the
+corporate income tax for the enterprises engaging in the encouraged industries in the Western China Region is charged
+at a preferential corporate income tax rate of 15% from January 1, 2011 to December 31, 2030. Certain branches and
+subsidiaries of the Company in the Western China Region obtained the approval for the use of the preferential corporate
+income tax rate of 15%.
+The tax on the Group's profit before taxation differs from the theoretical amount that would arise using the corporate
+income tax rate in the PRC applicable to the Group as follows:
+2021
+RMB
+2020
+RMB
+Profit before income tax expense
+158,203
+56,073
+Tax calculated at a tax rate of 25%
+39,551
+7,666
+Disposals or write offs
+14 BASIC AND DILUTED EARNINGS PER SHARE
+There are no potentially dilutive ordinary shares.
+RMB
+Motor
+Vehicles
+RMB
+Other
+RMB
+Construc-
+tion in
+Progress
+Total
+RMB
+RMB
+Cost
+At beginning of the year
+248,948
+2,355,925
+746,404
+22,857
+Additions
+1,561
+18,556
+5,305
+645
+Transfers
+13,736
+160,810
+38,649
+45,014
+1,880
+2,369
+228,882
+241,843
+(215,564)
+3,648,030
+RMB
+RMB
+and
+Machinery
+Properties
+15 DIVIDENDS
+2021
+2020
+RMB
+RMB
+Interim dividends attributable to owners of the Company for 2021 (a)
+Proposed final dividends attributable to owners of the Company for 2021 (b)
+Interim dividends attributable to owners of the Company for 2020 (c)
+Final dividends attributable to owners of the Company for 2020 (d)
+23,866
+17,610
+16,000
+16,000
+41,476
+32,000
+Basic and diluted earnings per share for the years ended December 31, 2021 and 2020 have been computed by
+dividing profit for the year attributable to owners of the Company by 183,021 million shares issued and outstanding for
+the year.
+(a) Interim dividends attributable to owners of the Company in respect of 2021 of RMB 0.13040 yuan (inclusive of applicable tax)
+per share, amounting to a total of RMB 23,866. The dividends were paid on September 17, 2021 (A shares) and October 29,
+2021 (H shares).
+(c) Interim dividends attributable to owners of the Company in respect of 2020 of RMB 0.08742 yuan (inclusive of applicable tax)
+per share, amounting to a total of RMB 16,000. The dividends were paid on September 22, 2020 (A shares) and November
+13, 2020 (H shares).
+(d) Final dividends attributable to owners of the Company in respect of 2020 of RMB 0.08742 yuan (inclusive of applicable tax)
+per share, amounting to a total of RMB 16,000. The dividends approved at the 2020 Annual General Meeting held on June 10,
+2021, and were paid on June 29, 2021 (A shares) and July 30, 2021 (H shares).
+248 PETROCHINA COMPANY LIMITED
+16 PROPERTY, PLANT AND EQUIPMENT
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+Year Ended
+Oil and
+Gas
+Equipment
+December 31, 2021
+Buildings
+(b) At the 14th meeting of the 8th Board, the Board of Directors proposed final dividends attributable to owners of the Company
+in respect of 2021 of RMB 0.09622 yuan (inclusive of applicable tax) per share amounting to a total of RMB 17,610. These
+consolidated financial statements do not reflect this dividend payable as the final dividends were proposed after the reporting
+period and will be accounted for in equity as an appropriation of retained earnings during the year ended December 31, 2022
+when approved at the forthcoming 2021 Annual General Meeting.
+(141)
+(380)
+(16,187)
+Company Limited (i)
+and Development
+16,100
+PRC
+CNPC Exploration
+company
+liability
+Limited
+Voting
+Equity
+Interest% Rights%
+100.00
+100.00
+Limited
+Entity
+Legal
+Registered
+Capital
+47,500
+PRC
+Daqing Oilfield Company
+Country of
+Incorporation
+Company Name
+Type of Attributable
+(All amounts in RMB millions unless otherwise stated)
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+FINANCIAL STATEMENTS
+The principal subsidiaries of the Group are:
+19 SUBSIDIARIES
+Limited
+liability
+company
+50.00
+PetroChina Hong Kong
+Limited
+Hong Kong
+90.00
+Limited
+liability
+company
+Company Limited
+Petrochemical
+10,000
+PRC
+PetroChina Sichuan
+100.00
+100.00
+Limited
+liability
+company
+18,096
+PRC
+254 PETROCHINA COMPANY LIMITED
+PetroChina International
+Company Limited
+Exploration, production and
+sale of crude oil and natural
+gas
+57.14 Exploration, production and
+sale of crude oil and natural
+gas outside the PRC
+Investment holding. The
+principal activities of its
+subsidiaries, associates
+and joint ventures are the
+exploration, production
+and sale of crude oil in and
+outside the PRC as well
+as natural gas sale and
+transmission in the PRC
+Investment holding. The
+principal activities of its
+subsidiaries associates
+and joint ventures are the
+exploration, development
+and production of crude oil,
+natural gas, oil sands and
+coalbed methane outside
+the PRC
+Principal Activities
+100.00
+Limited
+liability
+company
+Investment Company
+Limited
+31,314
+PRC
+PetroChina International
+100.00
+100.00
+Limited
+liability
+company
+HKD 7,592
+million
+100.00
+90.00
+Dividends amounting to RMB 17 were received on these investments during the year ended December 31, 2021
+(2020: RMB 25).
+1,168
+(344)
+comprehensive (loss)/income
+Group's share of total
+(3,007)
+3,508
+(650)
+1,874
+140
+(691)
+Total comprehensive (loss)/income
+3,060
+4,067
+362
+2,114
+185
+(610)
+Net (loss)/profit
+1
+(293)
+(846)
+(57)
+(56)
+Income tax expense
+(58)
+(56)
+46
+937
+(325)
+1,754
+486
+501
+188
+133
+228
+534
+RMB
+December 31, 2020
+December 31, 2021
+RMB
+Chengdu Huaqi Houpu Holding Co., Ltd.
+China Pacific Insurance (Group) Co., Ltd.
+Other items
+18 EQUITY INVESTMENTS MEASURED AT FAIR VALUE THROUGH OTHER
+COMPREHENSIVE INCOME
+In 2021, the share of profit and other comprehensive income in all individually immaterial associates and joint
+ventures accounted for using equity method in aggregate was RMB 1,418 (2020: a loss of RMB 2,468) and RMB 622
+(2020: RMB 3,631), respectively.
+902
+In 2021, investments in associates and joint ventures of RMB 489 (2020: RMB 1,687) were disposed, resulting in a
+loss of RMB 4 (2020: RMB 5) which was included in other income.
+(All amounts in RMB millions unless otherwise stated)
+NOTES TO THE FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS PetroChina
+253
+2021 ANNUAL REPORT
+410
+539
+233
+29
+Dividends received by the Group
+(1,504)
+Dividends received or receivable from associates and joint ventures were RMB 4,715 in 2021 (2020: RMB 4,517).
+(231)
+Kunlun Energy
+Company Limited (ii)
+HKD 160
+million
+Profit attributable to non-controlling
+520
+3,383
+(6,972)
+5,231
+Total comprehensive income/(loss)
+520
+3,383
+6,006
+8,413
+Net profit
+35,319
+48,493
+33,312
+42,730
+Revenue
+RMB
+RMB
+RMB
+RMB
+2020
+2021
+2020
+2021
+Petrochemical Company Limited
+interests
+4,837
+3,311
+338
+(5,191)
+Net cash outflow from investing activities
+5,119
+2,666
+5,681
+13,320
+Net cash inflow from operating activities
+RMB
+RMB
+RMB
+RMB
+2020
+PetroChina Sichuan
+2021
+2021
+Petrochemical Company Limited
+PetroChina Sichuan
+CNPC Exploration and
+Development Company Limited
+Summarised statement of cash flows is as follows:
+22
+12
+307
+1,498
+1,485
+Dividends paid to non-controlling interests
+52
+2020
+Bermuda
+CNPC Exploration and
+Development Company Limited
+24,781
+RMB
+RMB
+RMB
+31, 2020
+31, 2021
+December
+December
+December
+31, 2020
+31, 2021
+PetroChina Sichuan
+Petrochemical Company Limited
+December
+CNPC Exploration and
+Development Company Limited
+Summarised financial information in respect of the Group's principal subsidiaries with significant non-controlling
+interests as follows:
+(All amounts in RMB millions unless otherwise stated)
+NOTES TO THE FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS PetroChina
+2021 ANNUAL REPORT 255
+(ii) Kunlun Energy Co., Ltd. is a company listed on The Stock Exchange of Hong Kong Limited.
+(i) The Company consolidated the financial statements of the entity because it is exposed to, or has rights to, variable returns
+from its involvement with the entity and has the ability to affect those returns through its power over the entity.
+Investment holding. The
+principal activities of its
+principal subsidiaries,
+associates and joint ventures
+are the sales of natural gas,
+sales of liquefied petroleum
+gas and liquefied natural
+gas processing and terminal
+business in the PRC and the
+exploration and production
+of crude oil and natural gas
+in the PRC, the Republic of
+Kazakhstan, the Sultanate of
+Oman, the Republic of Peru,
+the Kingdom of Thailand and
+the Republic of Azerbaijan.
+Marketing of refined
+products and trading of
+crude oil and petrochemical
+products, storage,
+investment in refining,
+chemical engineering,
+storage facilities, service
+station, and transportation
+facilities and related business
+in and outside the PRC
+Engaged in oil refining,
+petrochemical, chemical
+products production,
+sales, chemical technology
+development, technical
+transfer and services
+54.38
+54.38
+Limited
+liability
+company
+RMB
+Summarised statement of comprehensive income is as follows:
+Percentage ownership interest (%)
+50.00
+25,032
+154,052
+158,507
+Net assets
+486
+382
+22,566
+30,293
+Non-current liabilities
+5,382
+3,876
+21,820
+50.00
+11,282
+26,371
+25,317
+182,392
+184,486
+Non-current assets
+4,278
+3,973
+16,046
+15,596
+Current assets
+90.00
+90.00
+Current liabilities
+Currency translation
+2021 ANNUAL REPORT
+257
+110
+Reclassified as liabilities held for sale
+(6,500)
+At end of the year
+340,450
+368,921
+264 PETROCHINA COMPANY LIMITED
+30 SHARE CAPITAL
+(56,849)
+Registered, issued and fully paid:
+H shares
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+December 31, 2021
+RMB
+December 31, 2020
+A shares
+Pipeline restructuring
+(6,282)
+(2,129)
+2020
+RMB
+RMB
+368,921
+466,722
+At beginning of the year
+Changes from financing cash flows:
+Increase in borrowings
+810,092
+989,492
+Repayments of borrowings
+(836,434)
+(1,017,662)
+Total changes from financing cash flows
+(26,342)
+(28,170)
+Exchange adjustments
+RMB
+161,922
+21,099
+183,021
+161,922
+RMB
+RMB
+RMB
+RMB
+Capital Reserve
+Beginning balance
+133,308
+133,308
+130,681
+130,681
+Ending balance
+133,308
+133,308
+130,681
+130,681
+Statutory Common Reserve Fund (a)
+Beginning balance
+2020
+2021
+2021
+The Company
+21,099
+183,021
+In accordance with the Restructuring Agreement between CNPC and the Company effective as of November 5,
+1999, the Company issued 160 billion state-owned shares in exchange for the assets and liabilities transferred to the
+Company by CNPC. The 160 billion state-owned shares were the initial registered capital of the Company with a par
+value of RMB 1.00 yuan per share.
+On April 7, 2000, the Company issued 17,582,418,000 shares, represented by 13,447,897,000 H shares and
+41,345,210 ADSS (each representing 100 H shares) in a global initial public offering ("Global Offering") and the trading
+of the H shares and the ADSs on The Stock Exchange of Hong Kong Limited and the New York Stock Exchange
+commenced on April 7, 2000 and April 6, 2000, respectively. Pursuant to the approval of the China Securities Regulatory
+Commission, 1,758,242,000 state-owned shares of the Company owned by CNPC were converted into H shares for sale
+in the Global Offering. The H shares and ADSs were issued at prices of HK$ 1.28 per H share and US$ 16.44 per ADS
+respectively for which the net proceeds to the Company were approximately RMB 20 billion. The shares issued pursuant
+to the Global Offering rank equally with existing shares.
+On September 1, 2005, the Company issued an additional 3,196,801,818 new H shares at HK$ 6.00 per share
+and net proceeds to the Company amounted to approximately RMB 19,692. CNPC also sold 319,680,182 state-owned
+shares it held concurrently with PetroChina's sale of new H shares in September 2005.
+On October 31, 2007, the Company issued 4,000,000,000 new A shares at RMB 16.70 yuan per share and net
+proceeds to the Company amounted to approximately RMB 66,243 and the listing and trading of the A shares on the
+Shanghai Stock Exchange commenced on November 5, 2007.
+Following the issuance of the A shares, all the existing state-owned shares issued before November 5, 2007 held by
+CNPC have been registered with the China Securities Depository and Clearing Corporation Limited as A shares.
+Shareholders' rights are governed by the Company Law of the PRC that requires an increase in registered capital to
+be approved by the shareholders in shareholders' general meetings and the relevant PRC regulatory authorities.
+2021 ANNUAL REPORT
+265
+FINANCIAL STATEMENTS PetroChina
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+31 RESERVES AND RETAINED EARNINGS
+(a) Reserves
+The Group
+2021
+2020
+203,557
+Reconciliation of movements of borrowings to cash flows arising from financing activities:
+366,350
+192,079
+- at floating rates
+208,644
+176,732
+340,450
+368,921
+Weighted average effective interest rates:
+131,705
+-
+corporate debentures
+- medium-term notes
+- other loans
+2.18%
+2.20%
+4.14%
+3.49%
+bank loans
+- at fixed rates
+Patents and technical
+101
+20,170
+51,239
+71,000
+86,000
+134,811
+151,337
+340,450
+368,921
+Borrowings of the Group of RMB 13,558 were guaranteed by CNPC and its fellow subsidiaries and non-controlling
+interests of the subsidiaries of the Group at December 31, 2021 (2020: RMB 13,726).
+The Group's borrowings include mortgage loans totaling RMB 1,185 at December 31, 2021 (2020: RMB 3,486),
+which were secured by property, plant and equipment with net book value of RMB 1,287 and intangible and other non-
+current assets with net book value of RMB 117.
+Total borrowings:
+December 31, 2021
+December 31, 2020
+RMB
+RMB
+-
+interest free
+3.28%
+3.32%
+2.51%
+3.47%
+The fair values of the Group's long-term borrowings including the current portion of long-term borrowings are RMB
+290,937 at December 31, 2021 (2020: RMB 323,809). The carrying amounts of short-term borrowings approximate
+their fair values. The fair values are based on discounted cash flows using applicable discount rates based upon the
+prevailing market rates of interest available to the Group for financial instruments with substantially the same terms and
+characteristics at the dates of the consolidated statement of financial position. Such discount rates ranged from 0.10%
+to 5.14% per annum as of December 31, 2021 (2020: -0.49% to 4.65%) depending on the type of the borrowings.
+The following table sets out the borrowings' remaining contractual maturities at the date of the consolidated
+statement of financial position, which are based on contractual undiscounted cash flows including principal and interest,
+and the earliest contractual maturity date:
+Within 1 year
+Between 1 and 2 years
+Between 2 and 5 years
+After 5 years
+December 31, 2021
+RMB
+December 31, 2020
+RMB
+58,923
+124,777
+53,250
+53,526
+226,124
+188,012
+28,053
+27,894
+368,921
+394,209
+7,910
+7,286
+2021 ANNUAL REPORT
+263
+FINANCIAL STATEMENTS PetroChina
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+The borrowings by major currency at December 31, 2021 and 2020 are as follows:
+RMB
+US Dollar
+Other currencies
+December 31, 2021
+RMB
+December 31, 2020
+RMB
+238,361
+262,458
+94,803
+98,553
+340,450
+197,282
+192,465
+186,190
+(7,369)
+Buildings
+(11,611)
+2,328
+(7,344)
+(6,595)
+Land
+(6,601)
+Accumulated depreciation
+(62,024)
+26,319
+269,819
+Total
+2,195
+(596)
+723
+234,114
+3,131
+(10,839)
+Equipment and Machinery
+166,302
+Land
+Net book value
+(24,328)
+5,829
+(15,074)
+(15,083)
+Total
+(712)
+115
+(426)
+(401)
+Other
+(1,166)
+255
+(703)
+(718)
+2,068
+Other
+2,641
+(322)
+209,786
+Total
+1,483
+Other
+1,475
+Equipment and Machinery
+46,498
+Buildings
+160,330
+Land
+Net book value
+(35,176)
+3,917
+(14,765)
+(24,328)
+Total
+(757)
+162,183
+Buildings
+42,465
+1,061
+29
+2,934
+Equipment and Machinery
+171,941
+57,337
+(40,603)
+6,020
+(20,503)
+19,547
+172,897
+91,920
+Buildings
+Land
+Cost
+December 31, 2020
+Reduction
+Additions
+December 31, 2019
+208,606
+2,897
+84,551
+Equipment and Machinery
+2,216
+10,810
+4,829
+(1,805)
+4,708
+Currency Translation Differences (b)
+Beginning balance
+(32,848)
+(28,939)
+Currency translation differences
+(2,684)
+(3,909)
+Ending balance
+(35,532)
+(32,848)
+Other Reserves
+Beginning balance
+(10,645)
+(10,083)
+9,231
+(7,076)
+Ending balance
+(1,633)
+Transfer from retained earnings
+8,413
+6,275
+8,413
+Ending balance
+211,970
+203,557
+200,878
+6,275
+192,465
+Special Reserve-Safety Fund Reserve
+Beginning balance
+10,810
+12,443
+4,708
+6,513
+Safety fund reserve
+(1,579)
+121
+80,345
+(5,739)
+(15)
+304,182
+329,270
+320,778
+266
+(a) Pursuant to the PRC regulations and the Company's Articles of Association, the Company is required to transfer 10% of its
+net profit, as determined under the PRC accounting regulations, to a Statutory Common Reserve Fund ("Reserve Fund").
+Appropriation to the Reserve Fund may cease when the fund aggregates to 50% of the Company's registered capital. The
+transfer to this reserve must be made before distribution of dividends to shareholders.
+The Reserve Fund shall only be used to make good previous years' losses, to expand the Company's production operations,
+or to increase the capital of the Company. Upon approval of a resolution of shareholders' in a general meeting, the Company
+may convert its Reserve Fund into share capital and issue bonus shares to existing shareholders in proportion to their original
+shareholdings or to increase the nominal value of each share currently held by them, provided that the balance of the Reserve
+Fund after such issuance is not less than 25% of the Company's registered capital.
+(b) The translation reserve comprises all foreign currency differences arising from the translation of the financial statements of
+foreign operations.
+PETROCHINA COMPANY LIMITED
+209,786
+254,736
+Total
+1,483
+1,475
+46,498
+160,330
+1,667
+Other
+308,560
+Transaction with non-controlling interests
+(7,076)
+(10,645)
+Fair value changes in equity investments measured at
+fair value through other comprehensive income
+79
+(22)
+(30)
+(10)
+Share of the other comprehensive income of associates
+and joint ventures accounted for using the equity
+method
+(4)
+(441)
+(175)
+(514)
+Other
+168
+(99)
+163
+(813)
+Ending balance
+(10,417)
+(7,118)
+268
+114,469
+RMB
+Provision for impairment of accounts receivable
+396
+426
+Reversal of provision for impairment of accounts receivable
+(110)
+(76)
+Receivables written off as uncollectible
+2,431
+(12)
+At end of the year
+1,414
+1,140
+The Group measures loss allowance for accounts receivable at an amount equal to lifetime ECLs. The ECLs were
+calculated by reference to the historical actual credit loss experience. The rates were considered the differences between
+economic conditions during the period over which the historical data has been collected, current conditions and the
+Group's view of economic conditions over the expected lives of the receivables. The Group performed the calculation of
+ECL rates by the operating segment and geography.
+260
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS
+(1,641)
+1,140
+At beginning of the year
+RMB
+December 31, 2020
+RMB
+55,446
+51,641
+816
+374
+194
+209
+203
+101
+56,659
+52,325
+The Group offers its customers credit terms up to 180 days.
+Movements in the provision for impairment of accounts receivable are as follows:
+2021
+2020
+RMB
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+Impairment provision on
+provision matrix basis
+1.6%
+50
+76
+1 to 2 years past due
+648
+153
+25.5%
+126
+279
+2 to 3 years past due
+329
+67
+45.0%
+118
+185
+Over 3 years past due
+Total
+845
+26
+December 31, 2021
+RMB
+3,153
+55
+Gross
+carrying
+amount
+Impairment
+provision on
+individual basis
+average loss rate
+Weighted- Impairment
+provision
+Loss
+allowance
+December 31, 2021
+Current (not past due)
+RMB
+RMB
+%
+RMB
+RMB
+53,098
+0.1%
+55
+Within 1 year past due
+352
+Over 3 years
+Between 1 and 2 years
+8,161
+(36)
+8,125
+(9,797)
+16,338
+(26,018)
+28,641
+7,987
+16,446 26,135
+29,006 54,659
+37,338
+38,853
+67,494
+(i) Goodwill primarily relates to the acquisition of Singapore Petroleum Company and Petrolneos Trading Limited, subsidiaries in
+the Marketing segment, completed in 2009 and 2011, respectively.
+The impairment of goodwill shall be tested in combination with its related asset groups. The recoverable amount of all cash-
+generating units has been determined based on the higher of fair value less costs to sell and value in use. These calculations
+use post-tax cash flow projections based on financial budgets prepared by management. The post-tax discount rates reflect
+specific risks relating to the cash-generating unit.
+For impairment test of the goodwill, the post-tax discount rates ranged 8.5% to 14.7% (2020: 4.9% to 10.5%) were used by
+the management, and no impairment loss was charged for the goodwill for the year ended December 31, 2021 (2020: nil).
+22 INVENTORIES
+December 31, 2021
+December 31, 2020
+66,344
+Other assets
+(27,581)
+56,587
+(6,905)
+1,308 7,846
+(6,657)
+1,189
+Computer software
+13,016
+(9,751)
+3,265 12,517
+(9,528)
+2,989
+Goodwill (i)
+8,023
+(36)
+Other
+27,335
+(10,889)
+Intangible assets
+RMB
+RMB
+Crude oil and other raw materials
+Work in progress
+(All amounts in RMB millions unless otherwise stated)
+23 ACCOUNTS RECEIVABLE
+Accounts receivable
+Less: Provision for impairment of receivables
+December 31, 2021
+December 31, 2020
+RMB
+RMB
+58,073
+53,465
+(1,414)
+(1,140)
+56,659
+52,325
+As of December 31, 2021, accounts receivable of the Group included derivative financial assets, which were
+generated by hedges, of RMB 3,913 (2020: RMB 1,411).
+The aging analysis of accounts receivable (net of impairment of accounts receivable) based on the invoice date (or
+date of revenue recognition, if earlier), at December 31, 2021 and 2020 is as follows:
+Within 1 year
+NOTES TO THE FINANCIAL STATEMENTS
+Between 2 and 3 years
+PETROCHINA COMPANY LIMITED
+259
+40,334
+35,855
+15,393
+12,387
+Finished goods
+Spare parts and consumables
+88,811
+80,739
+91
+75
+144,629
+Less: Write down in inventories
+(781)
+143,848
+129,056
+(517)
+128,539
+2021 ANNUAL REPORT
+FINANCIAL STATEMENTS PetroChina
+94.7%
+467
+819
+4,034
+Construction fee and equipment cost payables
+92,683
+107,199
+Other (i)
+53,834
+303,002
+82,187
+2,672
+316,140
+As of December 31, 2021, trade payables included derivative financial liabilities, which were generated by hedges,
+of RMB 3,881 (2020: RMB 3,709).
+The aging analysis of trade payables at December 31, 2021 and 2020 is as follows:
+Within 1 year
+Between 1 and 2 years
+Between 2 and 3 years
+Over 3 years
+262
+(i) Other consists primarily of notes payables, insurance payable, etc.
+Interests payable
+952
+419
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+25 FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME
+Financial assets at fair value through other comprehensive income represent mainly bills of acceptance issued by
+banks. The Group's business model of financial assets at fair value through other comprehensive income is achieved
+both by collecting contractual cash flows and selling of these assets. All financial assets at fair value through other
+comprehensive income are due within one year, and their fair values approximate the face values of the bills.
+26 CASH AND CASH EQUIVALENTS
+The weighted average effective interest rate on bank deposits was 1.68% per annum for the year ended December
+31, 2021 (2020: 1.69% per annum).
+27 ACCOUNTS PAYABLE AND ACCRUED LIABILITIES
+December 31, 2021
+RMB
+December 31, 2020
+RMB
+Trade payables
+144,419
+113,119
+Salaries and welfare payable
+8,975
+8,649
+Dividends payable by subsidiaries to non-controlling shareholders
+PETROCHINA COMPANY LIMITED
+December 31, 2021
+RMB
+December 31, 2020
+RMB
+Medium-term notes
+Other loans
+December 31, 2021
+RMB
+December 31, 2020
+RMB
+40,010
+42,354
+13,265
+75,188
+53,275
+117,542
+287,175
+251,379
+340,450
+368,921
+December 31, 2021
+December 31, 2020
+Corporate debentures
+PETROCHINA COMPANY LIMITED
+Bank loans
+Current portion of long-term borrowings
+134,744
+104,812
+2,767
+1,696
+948
+2,342
+5,960
+4,269
+144,419
+113,119
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+28 CONTRACT LIABILITIES
+As of December 31, 2021 and December 31, 2020, contract liabilities mainly represented advances from customers
+related to the sales of crude oil, natural gas and refined oil, etc. The majority of related obligations were expected to be
+performed with corresponding revenue recognised within one year. Substantially all of contract liabilities at the beginning
+of the year has been recognised as revenue for the year ended December 31, 2021.
+29 BORROWINGS
+Short-term borrowings excluding current portion of long-term
+borrowings
+Long-term borrowings
+FINANCIAL STATEMENTS PetroChina
+2021 ANNUAL REPORT 261
+(ii) Other current assets consist primarily of receivables from associates, dividends receivables, interests receivables, etc.
+Loss
+allowance
+RMB
+RMB
+0.1%
+34
+34
+154
+19
+65
+6.9%
+22
+87
+50
+25.6%
+10
+21
+854
+Impairment
+provision
+342
+11711
+RMB
+58,073
+598
+816
+1,414
+December 31, 2020
+Current (not past due)
+Within 1 year past due
+1 to 2 years past due
+2 to 3 years past due
+Over 3 years past due
+Total
+Gross
+carrying
+amount
+RMB
+46,849
+Impairment
+provision on
+individual basis
+Impairment provision on
+provision matrix basis
+Weighted-
+average loss rate
+%
+RMB
+94.3%
+825
+22,330
+55,883
+43,458
+(2,986)
+(3,378)
+52,897
+40,080
+42,644
+44,514
+505
+373
+4,853
+5,997
+11,921
+112,820
+18,298
+109,262
+(i) As of December 31, 2021 and December 31, 2020, the Group's other receivables are mainly in the first stage.
+14,900
+483
+21,128
+RMB
+53,465
+572
+568
+1,140
+5,326
+386
+0.4%
+24 PREPAYMENTS AND OTHER CURRENT ASSETS
+Other receivables(i)
+Advances to suppliers
+Less: Provision for impairment
+Value-added tax recoverable
+Prepaid expenses
+Prepaid income taxes
+Other current assets (ii)
+December 31, 2021
+RMB
+December 31, 2020
+40,983
+8,213
+(313)
+Other
+11,824
+11,181
+10,236
+30,541
+29,862
+154,636
+153,967
+208,853
+205,889
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+21 INTANGIBLE AND OTHER NON-CURRENT ASSETS
+December 31, 2021
+Accumulated
+December 31, 2020
+amortization,
+Accumulated
+amortisation,
+including
+including
+Cost
+impairment losses
+Net
+RMB
+RMB
+12,495
+RMB
+RMB
+December 31, 2021
+RMB
+(712)
+FINANCIAL STATEMENTS PetroChina
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+The Group's use of right assets mainly include leased land, buildings, equipment and machinery. The leases
+underlying assets classified as buildings are mainly the leased gas filling stations, oil storages and office buildings. The
+leases underlying assets classified as equipment and machinery are mainly drilling equipment, production equipment and
+other movable equipment.
+(b) Lease liabilities
+Lease liabilities
+Less: Lease liabilities due within one year
+December 31, 2021
+RMB
+December 31, 2020
+RMB
+129,848
+129,223
+(6,626)
+123,222
+(6,579)
+122,644
+Depreciation charged to profit or loss provided on right-of-use assets for the year ended December 31, 2021 was
+RMB 14,388 (2020:RMB 13,916).
+Analysis of the undiscounted cash flow of the lease liabilities is as follows:
+Within 1 year
+Between 1 and 2 years
+Between 2 and 5 years
+Over 5 years
+258
+PETROCHINA COMPANY LIMITED
+December 31, 2020
+Cost
+RMB
+know-how
+Net
+2,195
+186
+(563)
+1,818
+Total
+234,114
+17,251
+(7,583)
+243,782
+Accumulated depreciation
+Land
+(11,611)
+(7,022)
+(18,417)
+Buildings
+(10,839)
+(6,334)
+2,748
+(14,425)
+Equipment and Machinery
+(1,166)
+(1,096)
+685
+(1,577)
+impairment losses
+Other
+4,474
+216
+2,614
+RMB
+RMB
+(781)
+20 LEASES
+The leases where the Group is a lessee.
+(a) Right-of-use assets
+FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+December 31, 2020
+Additions
+Reduction
+December 31, 2021
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+5,120
+Land
+171,941
+9,331
+(672)
+180,600
+Buildings
+57,337
+Equipment and Machinery
+(5,567)
+2,641
+Cost
+56,890
+599,833
+628,226
+(39,866)
+RMB
+At beginning of the year
+Total comprehensive income for the year
+(8,413)
+62,751
+Transfer to reserves
+(6,275)
+Dividends
+RMB
+84,143
+2020
+On August 24, 2017, the Company entered into a new Buildings Leasing Contract with CNPC, which took effect
+on January 1, 2018 for a period of 20 years. The Company and CNPC may adjust the area of buildings leased and the
+rental fees every three years as appropriate by reference to the production and operations of the Company and the
+prevailing market prices, but the adjusted rental shall not exceed the comparable fair market prices. On August 27,
+2020, the Company and CNPC issued a confirmation letter to the Buildings Leasing Contract, which adjusted the annual
+rental payable and the area for the leased which took effect on January 1, 2021. Buildings covering an aggregate area of
+1,287,486 square meters were leased at annual rental payable approximately RMB 713 in accordance with the confirmed
+rental area and the current property market conditions. Apart from the annual rental payable and area of the leased
+building, the other terms in the Building Leasing Contract remains unchanged.
+(All amounts in RMB millions unless otherwise stated)
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+FINANCIAL STATEMENTS
+(b) The Company's retained earnings
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+The principal related party transactions with CNPC and its fellow subsidiaries, associates and joint ventures, which
+were carried out in the ordinary course of business, are as follows:
+The Company and CNPC entered into a new Comprehensive Products and Services Agreement on August 27,
+2020 for a period of three years effective from January 1, 2021. The Comprehensive Products and Services Agreement
+provides for a range of products and services which may be required and requested by either party. The products and
+services to be provided by CNPC and its fellow subsidiaries to the Group under the Comprehensive Products and
+Services Agreement include construction and technical services, production services, supply of material services, social
+services, ancillary services and financial services. The products and services required and requested by either party are
+provided in accordance with (1) government-prescribed prices; or (2) where there is no government-prescribed price,
+with reference to relevant market prices; or (3) where neither (1) nor (2) is applicable, then the actual cost incurred or the
+agreed contractual prices are used.
+On August 25, 2011, based on the Land Use Rights Leasing Contract signed for a period of 50 years from 2000,
+the Company and CNPC entered into a supplemental agreement to the Land Use Rights Leasing Contract which took
+effect on January 1, 2012. The expiry date of the supplemental agreement is the same as the Land Use Rights Leasing
+Contract, which is in 2050. The Company and CNPC may adjust area and rental payable for the leased land parcels every
+three years taking into consideration of production and operations of the Company and the prevailing market price. On
+August 27, 2020, the Company and CNPC each issued a confirmation letter to the Land Use Rights Leasing Contract,
+which adjusted the rental payable and the area for the leased land parcels with effect from January 1, 2021. The
+Company agreed to rent from CNPC and its fellow subsidiaries parcels of land with an aggregate area of approximately
+1,142 million square metres with annual rental payable (exclusive of tax and government charges) approximately RMB
+5,673 based on the area of leased land parcels and the current market conditions. Apart from the annual rental payable
+and are for the leased parcels, the other terms in the Land Use Rights Leasing Contract and supplemental agreement
+remained.
+2021 ANNUAL REPORT 271
+FINANCIAL STATEMENTS PetroChina
+PETROCHINA COMPANY LIMITED
+(28,078)
+2021
+Other
+Deferred tax assets:
+664,090
+24,646
+1,892
+Tax losses
+4,740
+9,124
+Receivables and inventories
+NOTES TO THE FINANCIAL STATEMENTS
+RMB
+RMB
+December 31, 2020
+December 31, 2021
+(5,016)
+(198)
+224
+(14,477)
+(7,666)
+(9,685)
+2,848
+628,226
+According to the relevant PRC regulations, the distributable reserve is the lower of the retained earnings computed
+under PRC accounting regulations and IFRS. As of December 31, 2021, the Company's distributable reserve amounted
+to RMB 654,956 (2020: RMB 619,102).
+32 DEFERRED TAXATION
+The movements in the deferred taxation account are as follows:
+At beginning of the year
+Transfer to profit and loss (Note 12)
+At end of the year
+Credit/debit) to other comprehensive income
+Deferred tax balances before offset are attributable to the following items:
+2021
+2020
+RMB
+RMB
+(5,016)
+At end of the year
+(All amounts in RMB millions unless otherwise stated)
+1,850
+•Sales of goods represent the sale of crude oil, refined products, chemical products and natural gas, etc. The total
+amount of these transactions amounted to RMB 115,587 for the year ended December 31, 2021 (2020: RMB
+105,535).
+101,453
+99,725
+(b) Key management compensation
+Emoluments and other benefits
+Contribution to retirement benefit scheme
+(c) Transactions with other state-controlled entities in the PRC
+2021
+RMB'000
+2020
+RMB'000
+15,143
+16,598
+1,568
+1,338
+16,711
+2,692
+17,936
+• Sales and purchases of goods and services;
+• Purchases of assets;
+Lease of assets; and
+• Bank deposits and borrowings
+These transactions are conducted in the ordinary course of the Group's business.
+2021 ANNUAL REPORT
+273
+FINANCIAL STATEMENTS PetroChina
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+39 SEGMENT INFORMATION
+The Group is principally engaged in a broad range of petroleum related products, services and activities. The
+Group's operating segments comprise: Exploration and Production, Refining and Chemicals, Marketing, and Natural
+Gas and Pipeline. On the basis of these operating segments, the management of the Company assesses the segmental
+operating results and allocates resources. Sales between operating segments are conducted principally at market prices.
+Additionally, the Group presents geographical information based on entities located in regions with a similar risk profile.
+The Exploration and Production segment is engaged in the exploration, development, transportation, production
+and marketing of crude oil and natural gas.
+Apart from the transactions with CNPC and its fellow subsidiaries, associates and joint ventures, the Group's
+transactions with other state-controlled entities include but are not limited to the following:
+613
+Lease liabilities
+Contract liabilities
+• Sales of services principally represent the provision of services in connection with the transportation of crude
+oil and natural gas, etc. The total amount of these transactions amounted to RMB 8,313 for the year ended
+December 31, 2021 (2020: RMB 8,593).
+• Purchases of goods and services principally represent construction and technical services, production services,
+social services, ancillary services and material supply services, etc. The total amount of these transactions
+amounted to RMB 416,561 for the year ended December 31, 2021 (2020: RMB 321,858).
+• Purchases of assets principally represent the purchases of manufacturing equipment, office equipment and
+transportation equipment, etc. The total amount of these transactions amounted to RMB 1,051 for the year ended
+December 31, 2021 (2020: RMB 767).
+• Interest income represents interests from deposits placed with CNPC and its fellow subsidiaries. The total interest
+income amounted to RMB 270 for the year ended December 31, 2021 (2020: RMB 381). The balance of deposits
+at December 31, 2021 was RMB 36,489 (2020: RMB 40,377).
+• Interest expense and other financial service expense, principally represents interest charged on the loans from
+CNPC and its fellow subsidiaries, insurance fee charged on the insurance services from CNPC and its fellow
+subsidiaries, etc. The total amount of these transactions amounted to RMB 4,878 for the year ended December
+31, 2021 (2020: RMB 8,051).
+•The borrowings from CNPC and its fellow subsidiaries at December 31, 2021 were RMB 133,800 (2020: RMB
+96,298).
+• Rents and other payments paid to CNPC and its fellow subsidiaries including (1) the rental expense paid by the
+Group according to Land Use Rights Leasing Contract and Buildings Leasing Contract between the Group and
+CNPC; (2) the payable by the Group (including all rents, leasing service fees and prices for exercising purchase
+options) for the period according to the leasing agreements entered into by the Group and CNPC and its fellow
+subsidiaries. The total rents and other payments amounted to RMB 6,797 for the year ended December 31, 2021
+(2020: RMB 8,294).
+272
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+Amounts due from and to CNPC and its fellow subsidiaries, associates and joint ventures included in the following
+accounts captions are summarised as follows:
+December 31, 2021
+December 31, 2020
+RMB
+RMB
+67,262
+49,526
+Accounts payable and accrued liabilities
+15,251
+15,696
+Intangible and other non-current assets
+Transactions with CNPC and its fellow subsidiaries, associates and joint ventures are summarised as follows:
+Impairment, depreciation and depletion of long-term assets
+35,063
+24,925
+Prepayments and other current assets
+8,651
+7,395
+Accounts receivable
+Financial assets at fair value through other comprehensive income
+8,250
+Deferred tax balances after offset are listed as follows:
+Other
+500
+800
+500
+RMB
+RMB
+December 31, 2020
+December 31, 2021
+The Group's major customers are as follows:
+37 MAJOR CUSTOMERS
+Between four and five years
+Between three and four years
+Between two and three years
+Between one and two years
+Within one year
+800
+According to the current policy, estimated annual payments for the next five years are as follows:
+NOTES TO THE FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS PetroChina
+2021 ANNUAL REPORT 269
+The Company is obligated to make annual payments with respect to its exploration and production licenses to the
+Ministry of Natural Resources. Payments incurred were RMB 744 for the year ended December 31, 2021 (2020: RMB
+700).
+(b) Exploration and production licenses
+At December 31, 2021, the Group's capital commitments contracted but not provided for, mainly relating to
+property, plant and equipment, were RMB 882 (2020: RMB 714). These capital commitments are transactions mainly with
+CNPC and its fellow subsidiaries.
+(a) Capital commitments
+36 COMMITMENTS
+The Group has insurance coverage for certain assets that are subject to significant operating risks, third-party liability
+insurance against claims relating to personal injury, property and environmental damages that result from accidents and
+employer liabilities insurance. The potential effect on the financial position of the Group of any liabilities resulting from
+future uninsured incidents cannot be estimated by the Group at present.
+(d) Group insurance
+During the reporting period, the Group has complied with domestic and overseas laws and regulatory requirements.
+Notwithstanding certain insignificant lawsuits as well as other proceedings outstanding, management believes that any
+resulting liabilities will not have a material adverse effect on the financial position of the Group.
+(c) Legal contingencies
+As of December 31,2021, the amounts of asset retirement obligations which have already been reflected in the
+consolidated financial statements relating to environmental liability were RMB 129,405 (Note 33).
+(All amounts in RMB millions unless otherwise stated)
+500
+800
+500
+PETROCHINA COMPANY LIMITED
+Related parties include CNPC and its fellow subsidiaries, their associates and joint ventures, other state-owned
+enterprises and their subsidiaries which the PRC government has control, joint control or significant influence over, and
+enterprises which the Group is able to control, jointly control or exercise significant influence over, key management
+personnel of the Company and CNPC and their close family members.
+CNPC, the immediate parent of the Company, is a limited liability company incorporated in PRC and directly
+controlled by the PRC government. Equity interest and voting rights of CNPC in the Company in 2021 was 80.41% (2020:
+80.41%).
+38 RELATED PARTY TRANSACTIONS
+8
+162,259
+8
+205,558
+3
+63,623
+3
+69,058
+CNPC and its fellow subsidiaries
+5
+98,636
+5
+136,500
+800
+500
+800
+2021
+2020
+Revenue
+The PRC has enacted comprehensive environmental laws and regulations that affect the operation of the oil and
+gas industry. Management believes that there are no probable liabilities under existing legislation, except for the amounts
+which have already been reflected in the consolidated financial statements, which may have a material adverse effect on
+the financial position of the Group.
+Percentage of
+total revenue
+Percentage of
+total revenue
+RMB
+%
+RMB
+%
+China Petrochemical Corporation and its fellow
+subsidiaries
+Revenue
+(b) Environmental liabilities
+At December 31, 2021 and 2020, the Group did not guarantee related parties or third parties any significant
+borrowings or others.
+(a) Bank and other guarantees
+12,161
+26,638
+RMB
+December 31, 2020
+December 31, 2021
+RMB
+Deferred tax liabilities
+Deferred tax assets
+The Refining and Chemicals segment is engaged in the refining of crude oil and petroleum products, production and
+marketing of primary petrochemical products, derivative petrochemical products and other chemical products.
+(All amounts in RMB millions unless otherwise stated)
+NOTES TO THE FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS PetroChina
+267
+2021 ANNUAL REPORT
+(5,016)
+(14,477)
+47,333
+41,640
+7,897
+6,622
+Total deferred tax assets
+27,163
+42,317
+Deferred tax liabilities:
+11,364
+Accelerated tax depreciation
+Total deferred tax liabilities
+Net deferred tax liabilities
+16,023
+24,147
+25,617
+23,186
+Other
+6,309
+16,380
+33 ASSET RETIREMENT OBLIGATIONS
+35 CONTINGENT LIABILITIES
+(All amounts in RMB millions unless otherwise stated)
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+268
+For the years ended December 31, 2021 and 2020, the Group had no forfeited in the defined contribution plans
+available for the Group used to reduce the existing contribution level.
+The Group participates in various employee retirement benefit plans (Note 3(aa)). Expenses incurred by the Group
+in connection with the retirement benefit plans for the year ended December 31, 2021 amounted to RMB 19,939 (2020:
+RMB 16,833).
+34 PENSIONS
+Asset retirement obligations relate to oil and gas properties (Note 16).
+114,819
+(654)
+(198)
+129,405
+At end of the year
+Currency translation differences
+5,107
+4,696
+2021
+2020
+RMB
+RMB
+At beginning of the year
+114,819
+At December 31, 2021, certain subsidiaries of the Company did not recognise deferred tax asset of deductible tax
+losses carried forward of RMB 109,752 (2020: RMB 99,997), of which RMB 13,866 (2020: RMB 10,973) was incurred
+for the year ended December 31, 2021, because it was not probable that the related tax benefit will be realised. These
+deductible tax losses carried forward of RMB 525, RMB 400, RMB 585, RMB 3,669 and RMB 104,573 will expire in
+2022, 2023, 2024, 2025, 2026 and thereafter, respectively.
+137,935
+16,057
+(24,059)
+Liabilities settled
+(5,969)
+(3,510)
+Accretion expense (Note 10)
+Net liabilities incurred, including reassessment
+The Marketing segment is engaged in the marketing of refined products and non-oil products, and the trading
+business.
+(571,705)
+The Head Office and Other segment relates to cash management and financing activities, the corporate center,
+research and development, and other business services supporting the other operating business segments of the Group.
+(17,833)
+(19,475)
+(1,825)
+(213,875)
+Including: Impairment
+losses of property, plant
+and equipment
+(15,364)
+(15,367)
+Profit/(loss) from operations
+23,092
+(1,834)
+(2,906)
+72,410
+(23,893)
+(14,825)
+Finance costs:
+Exchange gain
+14,387
+Exchange loss
+Interest income
+(14,279)
+3,023
+Interest expense
+(26,528)
+Total net finance costs
+(23,397)
+Share of (loss)/profit of
+associates and joint
+ventures
+75,937
+(150,849)
+amortisation
+Depreciation, depletion and
+Office and
+Marketing
+Pipeline
+Other
+Total
+RMB
+RMB
+RMB
+RMB
+RMB
+RMB
+Revenue
+530,807
+Less: Intersegment sales
+(437,670)
+774,775
+(492,667)
+1,497,533
+1,933,836
+2,227
+335,334
+1,221,030
+282,108
+93,137
+(616)
+customers
+3,177,433
+(1,243,597)
+(1,320)
+(35,437)
+(276,503)
+3,547
+370,771
+Revenue from external
+Gas and
+(24)
+2,128
+246,493
+1,932,109
+Other liabilities
+80,104
+Elimination of intersegment
+balances (a)
+(890,708)
+Total liabilities
+1,121,505
+Geographical information
+Revenue
+Non-current assets (b)
+2021
+RMB
+2020
+RMB
+626
+573,340
+December 31, 2021
+December 31, 2020
+RMB
+China's mainland
+Other
+1,626,616
+1,212,821
+987,733
+2,614,349
+721,015
+1,933,836
+1,838,505
+165,117
+2,003,622
+1,789,349
+190,625
+1,979,974
+(a) Elimination of intersegment balances represents elimination of intersegment accounts and investments.
+(b) Non-current assets mainly include non-current assets other than financial instruments and deferred tax assets.
+276
+PETROCHINA COMPANY LIMITED
+RMB
+21,143
+192,456
+16,294
+321,460
+21,810
+186,332
+2,773
+3,533
+Profit before income tax
+expense
+Income tax expense
+56,073
+(22,588)
+Profit for the year
+33,485
+Segment assets
+1,452,554
+432,022
+489,984
+195,353
+1,631,577
+Other assets
+4,201,490
+17,361
+Investments in associates
+186,620
+658,521
+Segment liabilities
+Capital expenditures
+(1,981,328)
+2,488,126
+Total assets
+balances (a)
+(728)
+Elimination of intersegment
+28,884
+160,730
+18,239
+1,289
+41,461
+and joint ventures
+250,603
+Head
+Natural
+Refining
+and
+Chemicals
+116,629
+324,954
+1,772,577
+397,496
+2,693
+2,614,349
+Depreciation, depletion and
+amortisation
+(175,329)
+(28,466)
+(20,338)
+(5,288)
+(1,848)
+(231,269)
+customers
+Including: Impairment
+(20,218)
+(4,681)
+(176)
+(26,471)
+Profit/(loss) from operations
+68,452
+49,740
+13,277
+43,965
+(14,281)
+161,153
+Finance costs:
+Exchange gain
+Exchange loss
+losses of property, plant
+and equipment
+Revenue from external
+4,254,284
+(1,639,935)
+(1,201)
+The accounting policies of the operating segments are the same as those described in Note 3 - "Summary of
+Principal Accounting Policies".
+274
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+(All amounts in RMB millions unless otherwise stated)
+The segment information for the operating segments for the years ended December 31, 2021 and 2020 are as
+follows:
+Exploration
+Year Ended December
+31, 2021
+and
+Production
+Refining
+and
+Chemicals
+Marketing
+Natural
+Gas and
+Pipeline
+Head
+Office and
+Other
+Total
+RMB
+(19,526)
+(397,485)
+3,894
+417,022
+2,170,062
+974,972
+(650,018)
+13,377
+Less: Intersegment sales
+Revenue
+RMB
+RMB
+RMB
+RMB
+RMB
+688,334
+(12,839)
+Interest income
+2,984
+Elimination of intersegment
+balances (a)
+Total assets
+(1,889,352)
+2,502,262
+Capital expenditures
+178,259
+Segment liabilities
+550,365
+54,487
+199,159
+10,982
+349,609
+6,750
+128,490
+700
+251,178
+566,602
+1,794,225
+Other liabilities
+Elimination of intersegment
+Production
+Exploration
+and
+Year Ended December
+31, 2020
+(All amounts in RMB millions unless otherwise stated)
+NOTES TO THE FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+265,785
+FINANCIAL STATEMENTS PetroChina
+2021 ANNUAL REPORT
+1,093,393
+(804,244)
+103,412
+Total liabilities
+balances (a)
+275
+The Natural Gas and Pipeline segment is engaged in the transportation and sale of natural gas.
+30,899
+19,020
+Interest expense
+(19,739)
+Total net finance costs
+Share of profit of associates
+and joint ventures
+(16,217)
+2,633
+68
+88
+680
+7,570
+2,316
+13,267
+Profit before income tax
+expense
+158,203
+Income tax expense
+(43,507)
+Profit for the year
+1,966
+44,289
+and joint ventures
+Investments in associates
+17,014
+Other assets
+169,611
+4,108,815
+164,934
+520,938
+457,914
+1,391,129
+Segment assets
+114,696
+1,573,900
+(1,396)
+(a) Transactions with CNPC and its fellow subsidiaries, associates and joint ventures
+270
+The Group has extensive transactions with other companies in CNPC and its fellow subsidiaries, associates and
+joint ventures. Due to the relationships, it is possible that the terms of the transactions between the Group and other
+members of CNPC and its fellow subsidiaries, associates and joint ventures are not the same as those that would result
+from transactions with other related parties or wholly unrelated parties.
+Property, plant and equipment
+74,916
+6,064
+Reserves at December 31, 2021
+(1,625)
+(4,420)
+(888)
+Production
+(2)
+(3)
+Sales
+1,286
+4,885
+472
+Extensions and discoveries
+121
+18,550
+27
+Proved developed reserves at:
+4,654
+6,079
+32,340
+689
+December 31, 2021
+6,279
+34,360
+552
+December 31, 2020
+Proved undeveloped reserves at:
+12,471
+42,576
+5,375
+December 31, 2021
+11,667
+42,077
+December 31, 2020
+117
+Improved recovery
+825
+108
+108
+Improved recovery
+(1,652)
+(595)
+(1,553)
+Revisions of previous estimates
+33
+107
+15
+Purchase
+Changes resulting from:
+19,959
+76,236
+7,253
+Extensions and discoveries
+385
+4,976
+1,215
+(2,011)
+1,160
+Revisions of previous estimates
+Purchase
+Changes resulting from:
+17,946
+76,437
+Equity method investments
+5,206
+(91)
+(1,626)
+(4,221)
+(922)
+Production
+(66)
+(80)
+Sales
+Reserves at December 31, 2020
+Share of proved developed and undeveloped
+reserves of associates and joint ventures
+December 31, 2020
+Total
+Other
+China's mainland
+2021
+Share of costs of property acquisition, exploration and
+development of associates and joint ventures
+Equity method investments
+Total
+Development costs
+Exploration costs
+Property acquisition costs
+The Group
+Costs Incurred for Property Acquisitions, Exploration and Development Activities
+20,465
+19,056
+964,423
+RMB
+RMB
+RMB
+7,610
+PetroChina
+FINANCIAL STATEMENTS
+281
+2021 ANNUAL REPORT
+2,110
+2,110
+190,753
+936,371
+20,573
+144,913
+12,084
+132,829
+38,230
+879
+37,351
+7,610
+170,180
+(million barrels of
+oil equivalent)
+(1,542,037)
+2,506,460
+Capitalised Costs
+At December 31, 2021, 5,286 million barrels (2020: 4,375 million barrels) of crude oil and condensate and 73,459.9
+billion cubic feet (2020: 74,794 billion cubic feet) of natural gas proved developed and undeveloped reserves of the
+Group are located within China's mainland and 778 million barrels (2020: 831 million barrels) of crude oil and condensate
+and 1,455.9 billion cubic feet (2020: 1,643 billion cubic feet) of natural gas proved developed and undeveloped reserves
+of the Group are located overseas.
+At December 31, 2021, total proved developed and undeveloped reserves of the Group and equity method
+investments is 18,844 million barrels of oil equivalent (2020: 18,202 million barrels of oil equivalent), comprising 6,272
+million barrels of crude oil and condensate (2020: 5,402 million barrels) and 75,427.3 billions of cubic feet of natural gas
+(2020: 76,800 billions of cubic feet).
+SUPPLEMENTARY INFORMATION ON OIL AND GAS EXPLORATION AND PRODUCTION ACTIVITIES (UNAUDITED)
+(Amounts in millions unless otherwise stated)
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS
+PETROCHINA COMPANY LIMITED
+280
+294
+511
+208
+December 31, 2021
+256
+363
+196
+The Group
+Property costs and producing assets
+Support facilities
+Construction-in-progress
+2,572,208
+150,535
+119,583
+465,022
+483,216
+1,890,903
+1,969,409
+(1,635,837)
+RMB
+December 31, 2020
+December 31, 2021
+Share of net capitalised costs of associates and joint ventures
+Equity method investments
+Net capitalised costs
+Accumulated depreciation, depletion and amortisation
+Total capitalised costs
+RMB
+(billion cubic feet)
+(million barrels)
+PETROCHINA COMPANY LIMITED
+200,055
+197,402
+TOTAL CURRENT ASSETS
+40,787
+31,955
+Cash and cash equivalents
+2,000
+3,550
+one year
+Time deposits with maturities over three months but within
+2,830
+3,598
+Financial assets at fair value through other comprehensive
+income
+68,213
+55,042
+CURRENT LIABILITIES
+Accounts payable and accrued liabilities
+Contract liabilities
+Other taxes payable
+396,639
+336,533
+3,706
+3,137
+86,962
+28,833
+45,769
+Prepaid expenses and other current assets
+51,615
+57,698
+200,325
+195,250
+NET CURRENT LIABILITIES
+TOTAL CURRENT LIABILITIES
+Lease liabilities
+Short-term borrowings
+59,877
+(139,131)
+8,412
+Accounts receivable
+December 31, 2021
+RMB
+Notes
+(All amounts in RMB millions unless otherwise stated)
+PETROCHINA COMPANY LIMITED
+NOTES TO THE FINANCIAL STATEMENTS
+FINANCIAL STATEMENTS
+Inventories
+CURRENT ASSETS
+TOTAL NON-CURRENT ASSETS
+Time deposits with maturities over one year
+Deferred tax assets
+Intangible and other non-current assets
+Right-of-use assets
+Subsidiaries
+Equity investments measured at fair value through other
+comprehensive income
+Investments in associates and joint ventures
+December 31,2020
+RMB
+1,032,712
+205,963
+77,813
+95,828
+1,619,858
+1,651,771
+3,050
+1,500
+2,019
+7,429
+34,746
+117,309
+115,152
+261,449
+260,759
+419
+380
+1,005,376
+195,490
+35,305
+NON-CURRENT ASSETS
+1,512,640
+TOTAL ASSETS LESS CURRENT LIABILITIES
+SUPPLEMENTARY INFORMATION ON OIL AND GAS EXPLORATION AND PRODUCTION ACTIVITIES (UNAUDITED)
+(Amounts in millions unless otherwise stated)
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS
+278 PETROCHINA COMPANY LIMITED
+Proved oil and gas reserves cannot be measured exactly. Reserve estimates are based on many factors related to
+reservoir performance that require evaluation by the engineers interpreting the available data, as well as price and other
+economic factors. The reliability of these estimates at any point in time depends on both the quality and quantity of
+the technical and economic data, and the production performance of the reservoirs as well as engineering judgement.
+Consequently, reserve estimates are subject to revision as additional data become available during the producing life of
+a reservoir. When a commercial reservoir is discovered, proved reserves are initially determined based on limited data
+from the first well or wells. Subsequent data may better define the extent of the reservoir and additional production
+performance, well tests and engineering studies will likely improve the reliability of the reserve estimate. The evolution
+of technology may also result in the application of improved recovery techniques such as supplemental or enhanced
+recovery projects, or both, which have the potential to increase reserves.
+Proved Oil and Gas Reserve Estimates
+The "Other" geographic area includes oil and gas producing activities principally in countries such as Kazakhstan,
+Australia and Indonesia. As the Group does not have significant reserves held through its investments accounted for
+using the equity method, information presented in relation to these equity method investments is presented in the
+aggregate.
+The supplemental information presented below covers the Group's proved oil and gas reserves estimates, historical
+cost information pertaining to capitalised costs, costs incurred for property acquisitions, exploration and development
+activities, result of operations for oil and gas producing activities, standardised measure of estimated discounted future
+net cash flows and changes in estimated discounted future net cash flows.
+In accordance with the Accounting Standards Update 2010-03 Extractive Activities Oil and Gas (Topic 932): Oil
+and Gas Reserve Estimation and Disclosures (an update of Accounting Standards Codification Topic 932 Extractive
+Activities - Oil and Gas or "ASC 932") issued by the Financial Accounting Standards Board and corresponding disclosure
+requirements of the U.S. Securities and Exchange Commission, this section provides supplemental information on oil
+and gas exploration and development; and results of operation related to oil and gas producing activities of the Company
+and its subsidiaries (the "Group") and also the Group's investments that are accounted for using the equity method of
+accounting.
+-
+SUPPLEMENTARY INFORMATION ON OIL AND GAS EXPLORATION AND PRODUCTION ACTIVITIES (UNAUDITED)
+(Amounts in millions unless otherwise stated)
+PETROCHINA COMPANY LIMITED
+PetroChina
+FINANCIAL STATEMENTS
+2021 ANNUAL REPORT 277
+Proved oil and gas reserves are the estimated quantities of crude oil and natural gas, which, by analysis of
+geoscience and engineering data, can be estimated with reasonable certainty to be economically producible from a given
+date forward, from known reservoirs, and under existing economic conditions, operating methods, and government
+regulation before the time at which contracts providing the right to operate expire, unless evidence indicates that renewal
+is reasonably certain, regardless of whether the estimate is a deterministic estimate or probabilistic estimate.
+Existing economic conditions include prices and costs at which economic producibility from a reservoir is to be
+determined. The price shall be the average price during the 12-month period before the ending date of the period
+covered by this report, determined as an unweighted arithmetic average of the first-day-of-the-month price for each
+month within such period, unless prices are defined by contractual arrangements, excluding escalations based upon
+future conditions. The costs shall be that prevailing at the end of the period.
+Proved developed oil and gas reserves are proved reserves that can be expected to be recovered:
+a. Through existing wells with existing equipment and operating methods or in which the cost of the required
+equipment is relatively minor compared with the cost of a new well.
+Natural Gas
+Crude Oil and
+Condensate
+Reserves at December 31, 2019
+The Group
+Proved developed and undeveloped reserves
+Estimated quantities of net proved crude oil and condensate and natural gas reserves and of changes in net
+quantities of proved developed and undeveloped reserves for each of the periods indicated are as follows:
+SUPPLEMENTARY INFORMATION ON OIL AND GAS EXPLORATION AND PRODUCTION ACTIVITIES (UNAUDITED)
+(Amounts in millions unless otherwise stated)
+The financial statements were approved by the Board of Directors on March 31, 2022 and will be submitted to
+shareholders for approval at the annual general meeting to be held on June 9, 2022.
+PETROCHINA COMPANY LIMITED
+FINANCIAL STATEMENTS
+279
+2021 ANNUAL REPORT
+Proved reserve estimates as of December 31, 2021 and 2020 were based on reports prepared by DeGolyer and
+MacNaughton, McDaniel & Associates, Ryder Scott and GLJ independent engineering consultants.
+The taxes, fees and royalty in China are domestic tax schemes and are paid in cash to PRC authorities. The proved
+reserves includes quantities that are ultimately produced and sold to pay these taxes, fees and royalty.
+Proved undeveloped oil and gas reserves are proved reserves that are expected to be recovered from new wells on
+undrilled acreage, or from existing wells where a relatively major expenditure is required for recompletion.
+b. Through installed extraction equipment and infrastructure operational at the time of the reserves estimate if the
+extraction is by means not involving a well.
+PetroChina
+(196,584)
+1,423,274
+1,423,274
+291,249
+1,176,381
+TOTAL EQUITY
+320,778
+329,270
+31 (a)
+Reserves
+628,226
+664,090
+31 (b)
+Retained earnings
+183,021
+183,021
+Share capital
+EQUITY ATTRIBUTABLE TO OWNERS OF THE COMPANY:
+EQUITY
+1,132,025
+NON-CURRENT LIABILITIES
+Long-term borrowings
+Lease liabilities
+336,259
+5,496
+4,678
+7,897
+81,941
+90,941
+47,983
+1,512,640
+47,976
+184,767
+41 APPROVAL OF FINANCIAL STATEMENTS
+TOTAL EQUITY AND NON-CURRENT LIABILITIES
+TOTAL NON-CURRENT LIABILITIES
+Other long-term obligations
+Deferred tax liabilities
+Asset retirement obligations
+155,829
+Total All products
+15 Queen's Road
+Property acquisition costs
+112,834
+150,979
+Extensions, discoveries and improved recovery
+(358,008)
+407,882
+Net changes in prices and production costs and other
+(215,390)
+(344,643)
+Sales and transfers of oil and gas produced, net of production costs
+1,325,069
+1,062,281
+Beginning of the year
+RMB
+RMB
+2020
+Development costs incurred
+Revisions of previous quantity estimates
+23,675
+39,238
+CORPORATE INFORMATION
+284 PETROCHINA COMPANY LIMITED
+1,062,281
+1,401,105
+End of the year
+(4,949)
+(301)
+2021
+Net change due to purchases and sales of minerals in place
+(73,272)
+Net change in income taxes
+146,137
+86,172
+Accretion of discount
+(138,772)
+88,332
+156,122
+Board of Directors
+The Group
+Changes in Standardised Measure of Discounted Future Net Cash Flows
+At December 31, 2020
+The Group
+SUPPLEMENTARY INFORMATION ON OIL AND GAS EXPLORATION AND PRODUCTION ACTIVITIES (UNAUDITED)
+(Amounts in millions unless otherwise stated)
+PETROCHINA COMPANY LIMITED
+PetroChina
+FINANCIAL STATEMENTS
+283
+2021 ANNUAL REPORT
+1,401,105
+(1,108,580)
+2,509,685
+(549,495)
+(462,411)
+(1,723,220)
+5,244,811
+Future cash inflows
+Future production costs
+Future development costs
+Future income tax expense
+14,788
+8,573
+December 31, 2020
+December 31, 2021
+Share of standardised measure of discounted future net cash flows of associates and joint ventures:
+At December 31, 2021, RMB 1,336,419 (2020: RMB 1,028,640) of standardised measure of discounted future net
+cash flows related to proved oil and gas reserves located within China's mainland and RMB 64,686 (2020: RMB 33,641)
+of standardised measure of discounted future net cash flows related to proved oil and gas reserves located overseas.
+1,062,281
+(947,035)
+Changes in the standardised measure of discounted net cash flows for the Group for each of the years ended
+December 31, 2021 and 2020 are as follows:
+2,009,316
+(445,462)
+(1,470,460)
+4,366,906
+RMB
+Standardised measure of discounted future net cash flows
+Discount at 10% for estimated timing of cash flows
+Future net cash flows
+(441,668)
+RMB
+Chairman:
+Non-executive Directors:
+Public Interest Entity Auditor registered
+PricewaterhouseCoopers
+Overseas Auditors
+Auditors
+CORPORATE INFORMATION
+285
+2021 ANNUAL REPORT
+Chai Shouping
+Liu Yuezhen
+Authorised Representatives
+Zhang Minglu
+Yang Jigang
+Tian Jinghui
+Li Luguang
+Sun Longde
+Chai Shouping
+Zhu Guowen
+in accordance with the Financial
+Reporting Council Ordinance
+22/F, Prince's Building
+Central, Hong Kong, PRC
+as to United States law:
+Shearman & Sterling
+12/F, Gloucester Tower
+The Landmark
+PRC
+Beijing 100020
+Chaoyang District
+No.1 East 3rd Ring Middle Road
+18/F, East Tower, World Financial Center
+King & Wood Mallesons
+Other Senior Management
+as to PRC law:
+Freshfields Bruckhaus Deringer
+3705 China World Office Two
+as to Hong Kong law:
+Legal Advisers to the Company
+2 Corporate Avenue, 202 Hu Bin Road, Huangpu
+District, Shanghai, PRC
+11/F, PricewaterhouseCoopers Center,
+PricewaterhouseCoopers Zhong Tian LLP
+Domestic Auditors
+1 Jianguomenwai Avenue
+Beijing
+Vice Chairman:
+Li Jiamin
+Jiang Lifu
+Fu Suotang
+Hong Kong Representative Office
+Unit 3705
+Tower 2 Lippo Centre
+89 Queensway
+Hong Kong
+Hong Kong Share Registrar and Transfer Office
+Hong Kong Registrars Limited
+Shops 1712-16, 17th Floor,
+Hopewell Centre, 183 Queen's Road East
+Hong Kong
+286 PETROCHINA COMPANY LIMITED
+Secretary to the Board of Directors:
+Independent Non-executive Directors:
+Executive Director and Senior Vice President:
+Executive Director and President:
+Central, Hong Kong
+Supervisory Committee
+Chairman:
+Supervisors:
+Zhang Fengshan
+Wang Liang
+Liu Xianhua
+Lv Bo
+Chai Shouping
+Jiang, Simon X.
+Cai Jinyong
+Simon Henry
+Tokuchi Tatsuhito
+Lu Yaozhong
+Elsie Leung Oi-sie
+Huang Yongzhang
+Jiao Fangzheng
+Liu Yuezhen
+Duan Liangwei
+PetroChina
+CORPORATE INFORMATION
+Dai Houliang
+Hou Qijun
+Ren Lixin
+The Group
+Discount at 10% for estimated timing of cash flows
+Standardised measure of discounted future net cash flows
+Future income tax expense
+(23,418)
+Exploration expenses
+(139,093)
+(12,177)
+(126,916)
+Production costs excluding taxes
+537,109
+65,844
+471,265
+413,760
+25,149
+388,611
+Inter-segment sales
+123,349
+40,695
+(830)
+(24,248)
+Depreciation, depletion and amortisation
+(128,297)
+137,382
+Results of operations from producing activities
+(33,294)
+(11,210)
+(22,084)
+Income taxes
+(4,696)
+82,654
+(139)
+Accretion expense
+(34,421)
+(5,810)
+(28,611)
+Taxes other than income taxes
+(157,714)
+(29,417)
+(4,557)
+6,261
+RMB
+Total
+3,712
+3,712
+RMB
+RMB
+RMB
+Total
+Other
+China's mainland
+2020
+development of associates and joint ventures
+Share of costs of property acquisition, exploration and
+Equity method investments
+Total
+Development costs
+Exploration costs
+35,862
+1,051
+36,913
+129,738
+Other
+2021
+RMB
+China's mainland
+Sales to third parties
+Revenue
+The Group
+RMB
+The results of operations for oil and gas producing activities for the years ended December 31, 2021 and 2020 are
+presented below. "Revenue” includes sales to third parties and inter-segment sales (at arm's-length prices), net of value-
+added taxes. Resource tax, crude oil special gain levy and other taxes are included in "taxes other than income taxes".
+Income taxes are computed using the applicable statutory tax rate, reflecting tax deductions and tax credits for the
+respective years ended.
+1,462
+1,462
+186,783
+21,183
+165,600
+146,158
+16,420
+Results of Operations for Oil and Gas Producing Activities
+Future net cash flows
+143,643
+Share of profit for producing activities of associates and
+joint ventures
+(4,905)
+(21,555)
+(2,690)
+(18,865)
+(149,960)
+(15,953)
+(134,007)
+(19,333)
+(482)
+(18,851)
+(133,759)
+(9,605)
+(124,154)
+382,548
+43,263
+(202)
+(5,107)
+(9,369)
+(5,340)
+Future development costs
+Future production costs
+Future cash inflows
+At December 31, 2021
+The Group
+The standardised measure of discounted future net cash flows related to proved oil and gas reserves at December
+31, 2021 and 2020 is as follows:
+The standardised measure of discounted future net cash flows related to proved oil and gas reserves at December
+31, 2021 and 2020 is based on the prices used in estimating the Group's proved oil and gas reserves, year-end costs,
+currently enacted tax rates related to existing proved oil and gas reserves and a 10% annual discount factor. "Future cash
+inflows" are net of value-added taxes. Corporate income taxes are included in “future income tax expense". Other taxes
+are included in "future production costs" as production taxes.
+339,285
+38,049
+29,134
+(76)
+(76)
+38,125
+8,991
+29,134
+(14,709)
+8,915
+Equity method investments
+319,031
+306,623
+Depreciation, depletion and amortisation
+Exploration expenses
+Production costs excluding taxes
+Inter-segment sales
+Sales to third parties
+Revenue
+The Group
+PETROCHINA COMPANY LIMITED
+282
+145,547
+8,165
+137,382
+Total of the Group and equity method investments results
+of operations for producing activities
+1,904
+1,904
+Taxes other than income taxes
+Accretion expense
+Income taxes
+FINANCIAL STATEMENTS
+63,517
+30,855
+32,662
+Standardised Measure of Discounted Future Net Cash Flows
+RMB
+RMB
+Total
+12,408
+Other
+2020
+Total of the Group and equity method investments
+results of operations for producing activities
+Share of profit for producing activities of associates
+and joint ventures
+Equity method investments
+Results of operations from producing activities
+SUPPLEMENTARY INFORMATION ON OIL AND GAS EXPLORATION AND PRODUCTION ACTIVITIES (UNAUDITED)
+(Amounts in millions unless otherwise stated)
+PETROCHINA COMPANY LIMITED
+China's mainland
+RMB
+SUPPLEMENTARY INFORMATION ON OIL AND GAS EXPLORATION AND PRODUCTION ACTIVITIES (UNAUDITED)
+(Amounts in millions unless otherwise stated)
+40 COMPANY-LEVEL STATEMENT OF FINANCIAL POSITION
+(0.6) percentage point
+Tons/day
+Sales volume per service station
+35.9
+35.3
+%
+Market share in domestic retail market
+5.1
+48,377
+8.05
+50,862
+Diesel
+8.1
+8,331
+9,005
+'000 tons
+Kerosene
+7.0
+49,188
+'000 tons
+52,626
+8.48
+Unit
+(0.2)
+20,212
+20,178
+Units
+Number of convenience stores
+(1.5)
+21,042
+20,734
+(5.1)
+Units
+among which:
+0.8
+Year-on-year change (%)
+December 31, 2020
+22,619
+22,800
+Units
+Number of service stations
+December 31, 2021
+owned service stations
+'000 tons
+of which: Gasoline
+6.2
+In 2021, the international trading business of the
+Group focused on domestic and overseas resources and
+markets, deepened global integration and cooperation,
+optimized supply chain management, strengthened
+sales of oil and gas, optimized the pace of refined oil
+exports, and expanded overseas markets for refining
+PetroChina
+BUSINESS REVIEW
+and chemical products.
+International Trading Operations
+022 PETROCHINA COMPANY LIMITED
+of gas stations in markets where it has an advantage
+with high profitability. The number of gas stations in
+operation reached 22,800. Development of new energy
+business was accelerated, with the first integrated service
+demonstration station for oil, gas, hydrogen, electricity
+and non-oil business completed and put into operation
+in Beijing. Furthermore, a number of hydrogen refuelling
+stations, battery-swap stations and photovoltaic stations
+were put into operation. The Group intensified integration
+and mutual market promotion of oil and non-oil businesses,
+promoted the marketing of its own commodities, poverty
+alleviation commodities and specialty commodities, and
+the gross profit of non-oil business increased significantly
+as compared with last year.
+In 2021, the Group's marketing business enhanced
+the efforts of marketing, and made every effort to expand
+the sales and improve the profitability based on ensuring
+the smooth operation of the industrial chains. It actively
+innovated the business model, accelerated the promotion
+and application of direct wholesale APP, flexibly adjusted
+gasoline and diesel marketing strategies, put into use the
+first batch of commercial intelligent fuelling robots and
+continued to improve the quality and efficiency of retailing
+business. The Group strengthened the development
+In 2021, the sales volume of gasoline, kerosene and
+diesel of the Group achieved a total of 163.307 million tons,
+representing an increase of 1.3% as compared with last
+year, of which the domestic sales of gasoline, kerosene
+and diesel were 112.493 million tons, representing an
+increase of 6.2% as compared with last year.
+Domestic Operations
+Note: Figures have been converted at the rate of 1 ton of crude oil = 7.389 barrels.
+12.0
+2,163
+2,422
+'000 tons
+Urea
+4.3
+1,001
+(3) Marketing
+Summary of Operations of the Marketing Segment
+Unit
+Sales volume of gasoline, kerosene and diesel
+105,896
+112,493
+'000 tons
+Domestic sales volume of gasoline, kerosene and diesel
+1.2
+81,728 80,796
+'000 tons
+Diesel
+8.7
+(0.2)
+66,084
+1.3
+2020 Year-on-year change (%)
+161,230
+2021
+163,307
+65,981
+15,598 14,350
+'000 tons
+Kerosene
+'000 tons
+of which: Gasoline
+'000 tons
+2021 ANNUAL REPORT
+1,044
+023
+(4) Natural Gas and Pipeline
+16.5
+6,725
+7,835
+2.6
+5,659
+5,808
+Polyethylene
+38.0
+Polypropylene
+2,652
+8.7
+14,350
+15,598
+Kerosene
+27.8
+4,221
+5,395
+1.2
+3,661
+80,796
+4,272
+1.7
+Selling, General and Administrative Expenses Selling,
+general and administrative expenses for 2021 was
+RMB57,802 million, representing a decrease of 10.2%
+as compared with last year. This was primarily due to the
+fact that the Group further promoted the improvement
+of quality and profitability, and the decrease in non-
+production expenses.
+Depreciation, Depletion and Amortisation Depreciation,
+depletion and amortisation for 2021 was RMB231,269
+million, representing an increase of 8.1% as compared
+with last year. This was primarily due to the combined
+effect of the increase in assets, the structural change in oil
+and gas resources and the impairment in assets.
+Exploration expenses for
+2021 was RMB24,248 million, representing an increase of
+25.4% as compared with last year. This was primarily due
+to the fact that the Group strengthened its efforts in terms
+of exploration and development and vigorously promoted
+the increase in both reserve and production of oil and gas.
+Exploration Expenses
+Employee Compensation Costs Employee compensation
+costs (including salaries of employees and cost of market-
+oriented temporary and seasonal contractors, various
+types of insurance, housing provident fund, training fees
+and other additional costs) for 2021 was RMB154,835
+million, representing an increase of 4.9% as compared
+with last year. This was primarily due to the fact that the
+State introduced temporary preferential policy for social
+insurance in 2020 in response to the COVID-19, which
+expired in 2021, and that employee's compensation in
+2021 changed in tandem with the Group's operating
+results.
+Purchases, Services and Other Purchases, services
+and other for 2021 was RMB1,770,019 million, representing
+an increase of 39.6% as compared with last year. This was
+primarily due to the increase of expenses for purchasing
+oil and gas products and trading expenses, along with the
+increase in the sales volume of the oil and gas products
+and the prices of the raw materials.
+Operating Expenses Operating expenses for 2021
+was RMB2,453,196 million, representing an increase of
+32.0% as compared with last year, of which:
+*The crude oil listed above represents all the external sales volume of crude oil of the Group.
+** The natural gas listed above represents all the external sales volume of natural gas of the Group. The large increase in average realised
+prices was mainly due to a significant increase in overseas re-export trade prices. The domestic sales price of natural gas increased
+by 6.5% as compared with last year.
+4,200
+6.7
+6,858
+11.5
+1,404
+1,565
+Lubricant
+11.8
+7,002
+7,830
+6,426
+81,728
+Diesel
+26.2
+Crude oil*
+2020
+2021
+Average Realised Price (RMB/ton)
+Sales Volume ('000 ton)
+DISCUSSION AND ANALYSIS OF OPERATIONS
+2021 ANNUAL REPORT 025
+Revenue The revenue of the Group was RMB2,614,349 million for 2021, representing an increase of
+35.2% as compared with last year. This was primarily due to the increase in the sales volume, the sharp rise
+in selling prices of most of the oil and gas products of the Group, and the outstanding work results of quality
+and profitability enhancement. The table below sets out external sales volume and average realised prices
+for major products sold by the Group in 2021 and 2020 and their respective percentage of change:
+158,342
+In 2021, the Group achieved a revenue of RMB2,614,349 million, representing an increase of 35.2%
+as compared with last year. Net profit attributable to equity holders of the Company was RMB92,170 million,
+representing an increase of 385.0% as compared with last year. Basic earnings per share were RMB0.50
+yuan, representing an increase of RMB0.40 yuan as compared with last year.
+1. The financial data set out below is extracted from the audited financial
+statements of the Group prepared under IFRS.
+The following discussion and analysis should be read in conjunction with the audited financial
+statements of the Group and the notes set out thereto in the Annual Report and other sections thereof.
+DISCUSSION AND ANALYSIS OF OPERATIONS
+Huang Yongzhang an Executive Director and President
+024 PETROCHINA COMPANY LIMITED
+In 2021, the Group sold 273.974 billion cubic metres
+of natural gas, representing an increase of 10.1% as
+compared with the same period last year. Among that,
+194.591 billion cubic metres were sold in domestic
+market, representing an increase of 12.7% as compared
+with the same period last year. By the end of 2021, the
+Group's domestic oil and gas pipelines measured a total
+length of 26,076 km, consisting of 17,329 km of natural
+gas pipelines, 7,340 km of crude oil pipelines and 1,407
+km of refined oil pipelines.
+terminal stations and related branch pipelines were
+completed and put into operation.
+In 2021, the Group's natural gas and pipeline
+business, seizing the favourable opportunities of
+recovery of the demand in markets, vigorously developed
+wholesale and retail markets as well as direct supply and
+sales customers, strengthened oil and gas mixing, gas-
+electricity integration and integration of gas-electricity
+and new energy, and actively carried out online bidding
+transactions. The Group continued to optimize the
+structure of the gas resources, and effectively ensured the
+safe and stable supply of natural gas. The construction
+of key projects was promoted in an orderly manner.
+The Tangshan LNG emergency peak management and
+guarantee project, the third phase of the Jiangsu LNG
+(1) Consolidated Operating Results
+158,266
+Percentage of
+Change (%)
+Generally even
+2021
+5,561
+7,018
+(0.2)
+66,084
+65,981
+Gasoline
+47.8
+1,170
+1,729
+10.1
+2,487.45
+2,739.74
+RMB/'000 cubic metre)**
+Natural gas (hundred million cubic metres,
+54.5
+2,070
+3,198
+Percentage of
+Change (%)
+2020
+BUSINESS REVIEW
+'000 tons
+Synthetic rubber
+(10.3)
+Billion cubic feet
+Marketable natural gas output
+(24.4)
+178.0
+CHAIRMAN'S REPORT
+PetroChina
+In terms of International Business, the Group will continue to optimize the structure of overseas assets, business
+structure and regional layout, and continue to improve the profitability of investment. It will strengthen fine exploration
+in mature exploration areas, expand the discovery scale of new areas, and confirm the reserves of more large-scale oil
+and gas fields of high quality. It will actively promote the construction of key projects, solidly develop new projects in
+high-profitability core areas overseas, optimize existing assets to a greater extent, carry out on a satisfactory basis the
+closing and follow-up operation of the Rumaila project. The Group will arrange the extension of high-quality projects and
+the transfer of rights and interests of newly discovered projects, so as to achieve the optimal allocation of assets and
+continuous improvement of investment returns.
+In terms of green and low-carbon transformation, the Group will comprehensively promote clean production, strengthen
+the dual control of energy consumption intensity and total volume, highlight the treatment of volatile organic compounds
+and methane emissions, and achieve synergy between energy saving, pollution reduction and carbon reduction. The
+Group will promote the construction of new energy bases in "desert, gobi, wasteland" with the integration of wind, solar,
+gas and storage, accelerate the development of geothermal resources in Beijing, Tianjin, Hebei, Shandong and other
+areas, and make efforts to provide clean and low-carbon energy.
+4,420.0
+Dai Houliang
+Beijing, the PRC
+March 31, 2022
+2021 ANNUAL REPORT
+017
+BUSINESS REVIEW
+BUSINESS REVIEW
+1. Market Review
+(1) Crude Oil Market
+In 2021, as demand for oil in global market gradually
+recovered and inventories decreased significantly, the
+supply-and-demand fundamentals in the market continued
+to improve. Supported by the abundant global liquidity
+and the larger-than-expected boost by European energy
+crisis by the end of this year, oil price in the international
+market had a sharp rise as compared with last year. The
+annual average spot price of North Sea Brent crude oil
+was US$70.91 per barrel, representing an increase of
+69.7% as compared with last year. The annual average
+spot price of the West Texas Intermediate ("WTI") crude
+oil was US$68.12 per barrel, representing an increase of
+73.4% as compared with last year.
+Chairman
+Statistics from the National Development and Reform
+Commission (the "NDRC") showed that the domestic output
+of crude oil was 198.98 million tons in 2021, representing
+an increase of 2.4% as compared with last year.
+4,221.0
+of which: domestic
+3.4
+1,409.7
+1,457.4
+Million barrels
+of which: domestic
+1,625.5
+1,624.8
+Million barrels
+4.7
+Oil and natural gas equivalent output
+227.2
+197.8
+Billion cubic feet
+overseas
+5.7
+3,993.8
+4,222.2
+Billion cubic feet
+(12.9)
+(2) Refined Products Market
+In 2021, the domestic macro-economy remained
+stable with good momentum for growth, which helped
+the gradual recovery of demand for refined oil. Together
+with the stable supply of refined oil in domestic market,
+the oversupply situation eased. Export quota of refined oil
+contracted by 36% with net exports of refined oil declining
+for the first time in the last decade.
+Statistics from NDRC and National Bureau of Statistics
+Summary of Operations of the Exploration and Production Segment
+BUSINESS REVIEW
+PetroChina
+Unit
+2021
+2020
+Year-on-year change (%)
+Crude oil output
+020 PETROCHINA COMPANY LIMITED
+of which: domestic
+887.9
+921.8
+(3.7)
+Million barrels
+753.4
+743.8
+1.3
+overseas
+Million barrels
+In 2021, the Group's crude oil output amounted to
+887.9 million barrels, representing a decrease of 3.7%
+as compared with last year. The marketable natural gas
+output reached 4,420.0 billion cubic feet, representing an
+increase of 4.7% as compared with last year. The oil and
+natural gas equivalent output amounted to 1,624.8 million
+barrels, generally the same with that in last year. As at the
+end of the reporting period, the total area to which the
+Group had the right of prospecting and mining of oil and
+natural gas (including coalbed methane) amounted to
+263.4 million acres, among which the area of prospecting
+was 227.0 million acres and the area of mining was 36.4
+million acres. The net number of wells in the process of
+being drilled was 615. The number of multi-completed
+wells during the reporting period was 7,172.
+was obtained. A number of low profitability projects were
+transferred and disposed. As a result, the structure of
+overseas oil and gas assets was continuously optimized.
+In 2021, the crude oil output from overseas operations
+amounted to 134.5 million barrels, representing a
+decrease of 24.4% as compared with last year, the output
+of marketable natural gas was 197.8 billion cubic feet,
+representing a decrease of 12.9% as compared with
+last year; and the output of oil and gas equivalent was
+167.4 million barrels, representing a decrease of 22.4%
+as compared with last year, accounting for 10.3% of the
+total oil and natural gas equivalent output of the Group.
+The large decrease in overseas oil and gas production
+was mainly due to the impact of increase in international
+oil prices, the decrease in product sharing of certain
+overseas projects and the production restriction policies
+in some resource-rich countries.
+In 2021, the Group's overseas oil and gas business
+developed steadily. Important discoveries have been
+made in various projects such as Niger and Chad. The
+exploitation of oil and gas was promoted in an orderly
+manner. Newly-built projects such as PSA in Chad were
+put into production, and partial interests in Rumaila project
+of China showed that in 2021, 703.55 million tons of crude
+oil were processed, representing an increase of 4.3% as
+compared with last year; the apparent consumption of
+refined oil was 341.48 million tons, representing an increase
+of 3.2% as compared with last year, among which that of
+gasoline and diesel oil had an increase of 5.7% and 0.5%,
+respectively, as compared with last year, respectively. The
+price trend of domestic refined oil remained basically the
+same as that of oil price in the international market. The
+PRC adjusted the domestic prices of gasoline and diesel
+21 times. The price of gasoline standard product and that
+of diesel standard product by RMB1,485 yuan per ton and
+RMB1,430 yuan per ton accumulatively.
+(3) Chemical Products Market
+In 2021, the price of the global energy and commodities
+soared significantly, which led the price of the domestic
+chemical market to rise as a whole; by the end of the year,
+as the prices of principal products, such as polyolefins, fell,
+the profit margin narrowed. The operation of the chemical
+products market improved generally, and the demand
+of new materials and new technologies promoted the
+transformation and upgrading of the industry.
+(4) Natural Gas Market
+In 2021, affected by the recovery of economy, the
+control of epidemic and the recovery of oil prices and other
+factors, the demand for natural gas in the global market
+recovered strongly. As a result, supply and demand of
+018 PETROCHINA COMPANY LIMITED
+BUSINESS REVIEW
+PetroChina
+natural gas market showed regional structural strain. The
+price of the natural gas remained at the high end. Under
+the effect of macro-economy, environmental policies, and
+the strategy of "dual carbon", the domestic demand of
+natural gas maintained rapid growth.
+2. Business Review
+(1) Exploration and Production
+Domestic Exploration and Development
+Statistics from NDRC showed that in 2021, the output
+of domestic natural gas was 205.3 billion cubic meters,
+representing an increase of 8.2% as compared with last
+year, the import volume of natural gas was 121.36 million
+tons, representing an increase of 19.9% as compared
+with last year, and the apparent consumption was 372.6
+billion cubic meters, representing an increase of 12.7% as
+compared with last year.
+In 2021, the Group adhered to innovation-driven
+development in the domestic exploration and development
+business, vigorously enhanced the exploration and
+development of oil and gas, and spared no efforts to promote
+profitable exploration and increase oil and gas reserves and
+output. We achieved multiple breakthroughs and important
+discoveries in Ordos, Tarim, Junggar, Sichuan and other
+key basins, implemented various large-scale reserve areas,
+thereby significantly improving the reserve replacement
+rate. We deeply promoted the stable output in the existing
+2021 ANNUAL REPORT
+019
+BUSINESS REVIEW
+oil and gas fields as well as profitable capacity construction
+in new fields. We continued to maintain the stable output of
+oil while increasing that of natural gas, as a result of which
+the proportion of the natural gas output continuously rose.
+In 2021, the domestic business achieved a crude oil output
+of 753.4 million barrels, representing an increase of 1.3% as
+compared with last year, the marketable natural gas output
+of 4,222.2 billion cubic feet, representing an increase of
+5.7% as compared with last year, and the oil and natural gas
+equivalent output of 1,457.4 million barrels, representing an
+increase of 3.4% as compared with last year.
+We actively developed new energy business,
+established the Shenzhen Institute for New Energy
+Research, actively promoted the development of new
+energy and new industry-related projects and continued to
+improve the development and utilization capacity of new
+energy. The Yumen photovoltaic power generation project
+with 200,000 KW was completed and put into operation,
+a breakthrough which marked the start of external clean
+electricity supply. The Beijing-Tianjin-Hebei geothermal
+heating demonstration base, and a batch of wind and
+photovoltaic power generation projects and CCUS projects
+in Jilin and Daqing progressed steadily.
+Overseas Oil and Gas
+overseas
+Million barrels
+167.4
+215.8
+Light products yield
+2.6 percentage points
+79.9
+82.5
+%
+Crude oil processing load
+(4.9)
+50,719
+%
+48,245
+Diesel
+10.3
+10,043
+11,079
+'000 tons
+Kerosene
+6.7
+46,280
+'000 tons
+77.0
+78.4
+(1.4) percentage points
+1,278
+1,146
+'000 tons
+Synthetic fibre materials and polymers
+6.0
+10,287
+10,903
+'000 tons
+Synthetic Resin
+5.8
+6,345
+6,713
+'000 tons
+Ethylene
+0.4 percentage point
+93.5
+93.9
+%
+Refining yield
+49,388
+026 PETROCHINA COMPANY LIMITED
+'000 tons
+1.6
+42,077
+42,576
+15.5
+4,654
+5,375
+Million barrels
+Billion cubic feet
+Proved developed reserves of crude oil
+Proved developed reserves of natural gas
+(2.0)
+1.2
+76,437
+Billion cubic feet
+Proved reserves of natural gas
+16.5
+5,206
+6,064
+Million barrels
+Proved reserves of crude oil
+(22.4)
+74,916
+Note: Figures have been converted at the rate of 1 ton of crude oil = 7.389 barrels and 1 cubic metre of natural gas = 35.315 cubic feet.
+(2) Refining and Chemicals
+In 2021, the Group's refining business adhered to
+market orientation; production and sales activities were
+closely connected. The Company actively promoted the
+reduction of refined business and increase in chemical
+business, further reduced the yield of refined oil, and
+continued to optimize the structure of refining products. The
+diesel-gasoline production ratio dropped to 0.98, and the
+output of aviation kerosene, lube base oil and paraffin was
+greatly increased. The Company continuously optimized
+the allocation of resources and insisted on allocating more
+crude oil resources to enterprises with good profitability.
+In 2021, the Group processed 1,225.0 million barrels of
+crude oil, representing an increase of 4.0% as compared
+with last year. Among that, 684.0 million barrels of crude
+oil were from the Group's exploration and production
+segment, accounting for 55.8%, which showed good
+synergic effects. In 2021, the Group produced 108.712
+million tons of refined oil, representing an increase of 1.6%
+as compared with last year.
+107,042
+108,712
+'000 tons
+Gasoline, kerosene and diesel output
+4.0
+Year-on-year change (%)
+2020
+1,177.5
+1,225.0
+Million barrels
+Processed crude oil
+2021
+Unit
+Summary of Production of the Refining and Chemicals Segment
+The Changqing and Tarim ethane-to-ethylene projects
+were completed and put into operation, and the construction
+of Guangdong Petrochemical and other key projects was
+accelerated.
+high-performance synthetic rubber, special fibers, high-
+end carbon materials and other new materials increased
+significantly.
+BUSINESS REVIEW
+2021 ANNUAL REPORT 021
+The chemical business, by closely monitoring market
+demand and price changes and forecasting market trends,
+maintained high-load operation of its chemical plants,
+and increased production and sales of high-value-added
+chemical products when appropriate. The Company
+actively promoted the new material business, established
+the Shanghai Institute for New Materials, strengthened
+scientific and technological innovation, launched
+number of technological research and actively carried out
+R&D of new chemical products and new materials. The
+Group also proactively changed the operation philosophy,
+developed marketing strategies for chemical products on
+a region-by-region basis, promoted the online operation
+of "PetroChina e-Chemical", actively expanded high-end
+market and end-customer channel of chemical products.
+In 2021, the volume of chemical products of the Group
+increased by 6.7% as compared with last year. The output
+of products, such as ethylene, synthetic resin, synthetic
+rubber and urea, increased to some extent as compared
+with last year. The output of functional synthetic resin,
+a
+of which: Gasoline
+Million barrels
+134.5
+Tian Jinghui
+DOCUMENTS AVAILABLE FOR INSPECTION
+PetroChina
+DOCUMENTS AVAILABLE FOR INSPECTION
+288 PETROCHINA COMPANY LIMITED
+Please contact our Hong Kong Representative Office for other information about the Company.
+Investment Information for Reference
+Shareholders may also browse or download the annual report of the Company and the Form 20-F filed
+with the SEC from the official website of the Company at www.petrochina.com.cn.
+Email: shrrelations@cpushareownerservices.com
+International call: 1-201-680-6825
+Calling from within the US and Canada (toll-free): 1 888 269 2377
+UNITED STATES
+Louisville, KY 40202
+462 South 4th Street Suite 1600
+BNY Mellon Shareowner Services
+UNITED STATES
+Louisville, KY 40233-5000
+PO BOX 505000
+BNY Mellon Shareowner Services
+USA
+Fax: (852) 2899 2390
+Tel: (852) 2899 2010
+The following documents will be available for inspection at the headquarters of the Company in Beijing
+and Shanghai Stock Exchange upon request by the relevant regulatory authorities and shareholders in
+accordance with the laws and regulations of the PRC and the Articles of Association:
+Hong Kong
+1. The original of the annual report for 2021 signed by the Chairman of the Company.
+3. The original of the Financial Report of the Company under the seal of the Auditors and under the
+hand of Certified Public Accountants.
+Huang Yongzhang
+梁免诗
+新
+仁
+黄峰
+Jiao Fangzheng
+Liu Yuezhen
+Duan Liangwei
+Hou Qijun
+Dai Houliang
+刘循珍焦方正
+Prip
+学
+Signatures of the Directors, Supervisors and senior management:
+According to the relevant provisions and requirements of the Securities Law of the People's Republic of China and
+Measures for Information Disclosure of Companies Offering Shares to the Public promulgated by the China Securities
+Regulatory Commission, as the Board of Directors, Supervisors and senior management of PetroChina Company
+Limited, we have carefully reviewed the annual report for 2021 and concluded that this annual report truly, objectively
+and completely represents the business performance of the Company, it contains no false representations, misleading
+statements or material omissions and its formulation and review comply with laws, regulations and the requirements of the
+China Securities Regulatory Commission.
+CONFIRMATION FROM THE DIRECTORS,
+SUPERVISORS AND SENIOR MANAGEMENT
+CONFIRMATION FROM THE DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
+2021 ANNUAL REPORT 289
+6. The annual report published in other stock markets.
+5. The original copies of all Chinese and English announcements of the Company published on the
+websites of the Hong Kong Stock Exchange and the Company during the period of the annual report.
+4. The original copies of the documents and announcement of the Company published in the
+newspaper stipulated by the China Securities Regulatory Commission during the reporting period.
+2. The financial statements under the hand and seal of Mr. Dai Houliang, Chairman of the Company,
+Mr. Huang Yongzhang, Director and President of the Company, and Mr. Chai Shouping, Chief Financial
+Officer of the Company.
+89 Queensway
+Tower 2 Lippo Centre
+Unit 3705
+Head Office
+Agricultural Bank of China Limited,
+Beijing, PRC
+Bank of Communications, Beijing Branch
+Tongtai Mansion, 33 Finance Street
+Xicheng District
+Beijing, PRC
+Xicheng District
+25 Finance Street
+China Construction Bank
+Beijing, PRC
+Beijing, PRC
+Xicheng District
+1 Fuxingmennei Avenue
+Bank of China, Head Office
+Xicheng District
+55 Fuxingmennei Avenue
+Head Office
+Industrial and Commercial Bank of China,
+Principal Bankers
+PetroChina
+CORPORATE INFORMATION
+Li Luguang
+23 Fuxingmennei Avenue
+Xicheng District
+Beijing, PRC
+China Development Bank Corporation Limited
+PetroChina Company Limited
+Fax: 86(10) 6209 9557
+Tel: 86(10) 5998 6270
+PRC
+No. 9 Dongzhimen North Street, Dongcheng District
+Beijing 100007
+PetroChina Company Limited
+Hong Kong
+PRC
+As required by the Securities Law of the United States, the Company will file an annual report on Form
+20-F with the U.S. Securities and Exchange Commission ("SEC") on or before April 30, 2022. The annual
+report on Form 20-F contains a detailed description of the Company's businesses, operating results and
+financial conditions. Copies of the annual report and the Form 20-F submitted to the SEC will be made
+available at the following addresses:
+Publications
+Ren Lixin
+CORPORATE INFORMATION
+2021 ANNUAL REPORT
+UNITED STATES
+Louisville, KY 40233-5000
+PO BOX 505000
+BNY Mellon Shareowner Services
+Depository
+CITIC Bank Corporation Limited,
+Sales Department of Head Office
+A27 Finance Street
+Xicheng District
+Beijing, PRC
+Beijing, PRC
+Xicheng District
+16 Taipingqiao Avenue
+287
+Elsie Leung Oi-sie Tokuchi Tatsuhito
+Overnight correspondence should be sent to:
+고름
+问题
+Chai Shouping
+Yang Jigang
+文
+Zhang Minglu
+March 31, 2022
+光
+This annual report is published in English and Chinese.
+290 PETROCHINA COMPANY LIMITED
+PetroChina
+This report is printed on recycled paper
+made in the People's Republic of China
+Devgner CHPC Ating Company Limited 10-802735
+Sun Longde
+awai pom 呂波
+In the event of any inconsistency between the English and Chinese versions, the Chinese version shall prevail.
+民法
+Zhu Guowen
+Li Jiamin
+the Steny
+Liu Xianhua
+Z3
+好
+Cai Jinyong
+Simon Henry
+Lv Bo
+Jiang, Simon X.
+Jiang Lifu
+张
+刘华
+Lu Yaozhong
+Wang Liang
+Fu Suotang
+Zhang Fengshan
+117,542
+287,175
+251,379
+340,450
+368,921
+Less: Cash and cash equivalents
+Within 1 year
+136,789
+118,631
+203,661
+250,290
+The following table sets out the remaining contractual maturity of borrowings as at the respective dates according
+to the earliest contractual maturity dates. The amounts set out below are contractual undiscounted cash flows, including
+principal and interest:
+Between 1 and 2 years
+53,275
+Net borrowings
+Total borrowings
+031
+term borrowings)
+118,631
+2021 ANNUAL REPORT
+Between 2 and 5 years
+DISCUSSION AND ANALYSIS OF OPERATIONS
+Net Cash Flows from Operating Activities
+The net cash flows of the Group from operating
+activities in 2021 amounted to RMB341,469 million,
+representing a year-on-year increase of 7.2%. This was
+mainly due to the combined impact from the change in
+profit and working capital during the reporting period.
+As at December 31, 2021, the Group had cash and
+cash equivalents of RMB136,789 million. The cash and
+cash equivalents were mainly denominated in US Dollar
+and Renminbi (approximately 36.7% were denominated
+in US Dollar, approximately 58.5% were denominated in
+Renminbi, approximately 3.8% were denominated in HK
+Dollar and approximately 1.0% were denominated in other
+currencies).
+December 31, 2021
+Net Cash Flows Used for Investing Activities
+The net cash flows of the Group used for investing activities
+in 2021 amounted to RMB213,032 million, representing an
+increase of 17.1% as compared with last year, which was
+primarily due to the combined effects of the increase in capital
+expenditures and pipeline assets restructuring.
+Net Cash Flows Used for Financing Activities
+The net cash used by the Group for financing activities
+in 2021 was RMB107,971 million, representing an increase
+of 8.6% as compared with last year. This was primarily due
+to the optimization of the Group's debt structure and the
+decrease of new long-term and short-term borrowings.
+The net borrowings of the Group as at December 31, 2021 and December 31, 2020, respectively, were as follows:
+As at December 31, 2021
+RMB million
+As at December 31, 2020
+RMB million
+Short-term borrowings (including current portion of long-
+Long-term borrowings
+After 5 years
+PetroChina
+As at December 31, 2021
+RMB million
+Estimated amount for 2022
+RMB million
+%
+RMB million
+%
+RMB million
+%
+Exploration and Production*
+178,259
+70.97
+186,620
+75.71
+181,200
+74.88
+Refining and Chemicals
+2020
+032 PETROCHINA COMPANY LIMITED
+2021
+(5) Capital Expenditures
+As at December 31, 2020
+RMB million
+58,923
+124,777
+53,250
+53,526
+226,124
+188,012
+28,053
+27,894
+366,350
+394,209
+DISCUSSION AND ANALYSIS OF OPERATIONS
+(4,967)
+Of the total borrowings of the Group as at December
+31, 2021, approximately 38.7% were fixed-rate borrowings
+and approximately 61.3% were floating-rate borrowings.
+Of the borrowings as at December 31, 2021, approximately
+70.0% were denominated in Renminbi, approximately
+27.9% were denominated in US Dollar, and approximately
+2.1% were denominated in other currencies.
+As at December 31, 2021, the gearing ratio of the Group
+(gearing ratio = interest-bearing borrowings/(interest-bearing
+borrowings + total equity), interest-bearing borrowings
+include various short-term and long-term borrowings) was
+19.5% (21.3% as at December 31, 2020).
+In 2021, the Group, by adhering to the principle
+of investing on a rigorous, precise and profitable basis,
+continued to improve its level of investment management,
+continuously optimized the investment structure and
+strived to improve investment profitability. In 2021,
+the capital expenditures of the Group amounted to
+RMB251,178 million, representing an increase of 1.9%
+as compared with last year. The table below sets out the
+capital expenditures of the Group for 2021 and 2020 and
+estimated capital expenditure of each business segment
+for 2022.
+(99,400)
+%
+318,575
+1,366,621
+1,408,869
+Total equity
+6.0
+727,955
+771,980
+Retained earnings
+1.4
+304,182
+308,560
+Reserves
+183,021
+183,021
+Share capital
+4.0
+3.1
+1,215,158
+030
+DISCUSSION AND ANALYSIS OF OPERATIONS
+341,469
+RMB million
+Year ended December 31
+2021
+The table below sets forth the net cash flows of the
+Group for 2021 and 2020 respectively and the amount of
+cash and cash equivalents as at the end of each year:
+Current liabilities amounted to RMB518,158 million,
+representing a decrease of 14.4% from that as at the end
+of 2020, primarily due to the fact that the Group continued
+to optimize the asset and liability structure, and the
+decrease in the amount of short-term borrowings.
+As at December 31, 2021, the primary source of
+funds of the Group was cash from operating activities
+and short-term and long-term borrowings. The funds
+of the Group were mainly used for operating activities,
+capital expenditures, repayment of short-term and long-
+term borrowings as well as distribution of dividends to
+shareholders of the Company.
+(4) Cash Flows
+Total liabilities amounted to RMB1,093,393 million,
+representing a decrease of 2.5% from that as at the end
+of 2020, of which:
+54,487
+Non-current assets amounted to RMB2,021,424
+million, representing an increase of 1.0% from that as
+at the end of 2020, primarily due to the increase in the
+investment in associate companies and joint ventures.
+Equity attributable to owners of the Company
+amounted to RMB1,263,561 million, representing an
+increase of 4.0% from that as at the end of 2020, primarily
+due to the increase in retained earnings.
+Non-current liabilities amounted to RMB575,235
+million, representing an increase of 11.5% from that as at
+the end of 2020, primarily due to the increase in long-term
+borrowings and asset disposal liabilities.
+Current assets amounted to RMB480,838 million,
+representing a decrease of 1.2% from that as at the end
+of 2020, primarily due to the decrease in held-for-sale
+assets resulting from the closing of the transfer of equity in
+Kunlun Energy pipeline assets.
+Total assets amounted to RMB2,502,262 million,
+representing an increase of 0.6% from that as at the end
+of 2020, of which:
+PetroChina
+PETROCHINA COMPANY LIMITED
+(181,986)
+1,263,561
+11.5
+2,488,126
+Net cash flows from operating activities
+Percentage of
+Change
+As at
+December 31, 2020
+RMB million
+2,502,262
+RMB million
+Current assets
+Total assets
+Net cash flows used for investing activities
+Net cash flows used for financing activities
+Translation of foreign currency
+Cash and cash equivalents at end of the year
+(213,032)
+(107,971)
+(2,308)
+136,789
+2020
+RMB million
+0.6
+Equity attributable to owners of the Company
+480,838
+(1.2)
+516,087
+575,235
+Non-current liabilities
+(14.4)
+605,418
+518,158
+Current liabilities
+(2.5)
+1,121,505
+1,093,393
+Total liabilities
+1.0
+2,001,359
+2,021,424
+Non-current assets
+486,767
+21.69
+RMB million
+2,502,533
+8.85
+(2) Segment Results
+Exploration and Production
+Revenue The realised revenue of the Exploration and
+Production segment for 2021 was RMB688,334 million,
+representing an increase of 29.7% as compared with last
+year, which was primarily due to the increase in the prices
+of oil and gas products and the rise in the sales volume
+of natural gas. In 2021, the crude oil imported under
+the Exploration and Production segment of the Group
+amounted to 37.13 million tons, representing a decrease
+of 4.9% as compared with last year. The revenue from the
+sales was RMB119,547 million for 2021, representing an
+increase of 40.5% as compared with last year.
+2021 ANNUAL REPORT
+027
+DISCUSSION AND ANALYSIS OF OPERATIONS
+BLOOD
+The average realised crude oil price of the Group in
+2021 was US$65.58 per barrel, representing an increase
+of 62.6% as compared with last year.
+Operating Expenses Operating expenses of the
+Exploration and Production segment for 2021 was
+RMB619,882 million, representing an increase of 22.1%
+as compared with last year, which was primarily due to
+the increase in procurement expenses and taxes other
+than income taxes. In 2021, the cost from importing crude
+oil of the Exploration and Production segment of the
+Group amounted to RMB119,354 million, representing an
+increase of 38.2% as compared with last year.
+In 2021, the unit oil and gas lifting cost of the Group
+was US$12.30 per barrel, representing an increase of
+10.8% as compared with last year. Excluding the impact
+of exchange rate of US Dollar against Renminbi, the
+year-on-year increase rate was 3.6%.
+Profit from Operations In 2021, the Exploration
+and Production segment, by actively adapting to the
+requirements of "carbon peaking and carbon neutrality" in
+domestic business, steadily promoted the transformation
+of oil and gas business to the green and low-carbon
+track. It continuously optimized the structure of oil and
+gas products and vigorously strengthened natural gas
+028
+PETROCHINA COMPANY LIMITED
+DISCUSSION AND ANALYSIS OF OPERATIONS
+PetroChina
+Profit Before Income Tax Expense Profit before income
+tax expense for 2021 was RMB158,203 million, representing
+an increase of 182.1% as compared with last year.
+Refining and Chemicals
+Net Interest Expense Net interest expense for 2021
+was RMB 16,755 million, representing a decrease of 28.7%
+as compared with last year, primarily due to the control of
+the scale of interest-bearing debts, optimization of debt
+structure, and reduction of cost of debts by the Group.
+Profit Attributable to Owners of the Company Profit
+attributable to owners of the Company for 2021 was
+RMB92,170 million, representing an increase of 385.0%
+as compared with last year.
+1.0
+Total liabilities
+1,093,409
+1,121,515
+(2.5)
+Current liabilities
+The following table sets out the key items in the consolidated balance sheet of the Group:
+DISCUSSION AND ANALYSIS OF OPERATIONS
+PetroChina
+Taxes other than Income Taxes Taxes other than
+income taxes for 2021 was RMB228,003 million,
+representing an increase of 16.4% as compared with last
+year, among which the consumption tax for 2021 was
+RMB161,623 million, representing an increase of 11.1%
+as compared with last year; the resource tax for 2021 was
+RMB23,723 million, representing an increase of 28.5% as
+compared with last year; and crude oil special gain levy
+for 2021 increased by RMB4,477 million as compared with
+last year to RMB4,655 million.
+Other Income, net Other income, net for 2021
+was RMB12,980 million, representing a decrease of
+74.5% as compared with last year, primarily due to the
+comprehensive influence of the gains from the transaction
+of pipeline assets of Kunlun Energy Company Limited
+("Kunlun Energy"), a subsidiary of the Group, in 2021
+and the gains from the pipeline assets restructuring of the
+Group in 2020.
+Profit from Operations The profit from operations for
+2021 was RMB161,153 million, representing an increase
+of 112.2% as compared with last year.
+Income Tax Expense The income tax expense for
+2021 was RMB43,507 million, representing an increase of
+92.6% as compared with last year, which was primarily
+due to the sharp increase in the Group's profit before
+income tax expense over the same period last year.
+Profit for the Year Net profit for 2021 was RMB114,696
+million, representing an increase of 242.5% as compared
+with last year.
+Profit Attributable to Non-controlling Interests Profit
+attributable to non-controlling interests for 2021 was
+RMB22,526 million, representing an increase of 55.6% as
+compared with last year, which was primarily due to the
+sharp increase of profits of subsidiaries of the Company
+with the rise of the prices of oil and gas over the same
+period last year.
+Net Exchange Gain Net exchange gain for 2021
+was RMB538 million, representing an increase of 398.1%
+as compared with last year. This was primarily due to the
+impact of fluctuation in exchange rate of US Dollar against
+Renminbi.
+2,001,633
+Revenue The revenue of the Refining and Chemicals
+segment for 2021 was RMB974,972 million, representing an
+increase of 25.8% as compared with last year, primarily due
+to the rise in the price of the refined and chemical products,
+and the increase in the sales volume of certain products.
+In particular, the operating income of the refining business
+was RMB736,004 million, representing an increase of 23.9%
+as compared with last year; the operating income of the
+chemical business was RMB238,968 million, representing
+an increase of 32.2% as compared with last year.
+Marketing
+3.1
+1,366,885
+1,409,124
+Total equity
+4.0
+1,215,421
+1,263,815
+Equity attributable to equity holders of the Company
+11.5
+516,097
+575,251
+Non-current liabilities
+(14.4)
+605,418
+518,158
+036 PETROCHINA COMPANY LIMITED
+segment in 2021 realised operating profits of RMB49,740
+million, increasing by RMB51,574 million from last year, which
+is primarily due to the increase in sales volume and gross
+profit of the products. Among that, the refining business
+recorded an operating profit of RMB37,730 million, increasing
+by RMB50,531 million from last year; while the chemical
+business realised an operating profit of RMB12,010 million,
+representing an increase of RMB1,043 million as compared
+with last year.
+(3) Assets, Liabilities and Equity
+In 2021, the Group's international operations (Note)
+realised a revenue of RMB987,733 million, accounting for
+37.8% of the Group's total revenue. Profit before income
+tax expenses amounted to RMB8,836 million, accounting
+for 5.6% of the Group's profit before taxes. The Group's
+international operations maintained a stable development
+with continuous improvement in its abilities of international
+operation.
+Revenue The revenue of the Marketing segment for
+2021 was RMB2,170,062 million, representing an increase
+of 44.9% as compared with last year, primarily due to the
+increase in the price and sales volume of refined oil.
+Operating Expenses Operating expenses of the
+Marketing segment for 2021 was RMB2,156,785 million,
+representing an increase of 43.7% as compared with last
+year, primarily due to the increase in the expenditure arising
+from the external purchase of refined oil.
+Operating Expenses Operating expenses of the
+Refining and Chemicals segment for 2021 was RMB925,232
+million, representing an increase of 19.1% as compared with
+last year, primarily due to the increase in the procurement
+costs of crude oil and feedstock, as well as the increase in
+taxes other than income taxes.
+In 2021, the cash processing cost of refineries of
+the Group was RMB166.65 yuan per ton, representing an
+increase of 1.7% as compared with last year, primarily due
+to the increase in the price of fuel power.
+Profit from Operations In 2021, the Refining and
+Chemicals segment adhered to market orientation, centralised
+in profitability, continued optimizing production and operation
+and improving profitability, and vigorously strengthened its
+control over costs and expenses. The Refining and Chemicals
+In 2021, the Marketing
+Profit from Operations
+segment, by taking advantage of the gradual recovery of
+the demand for refined oil in domestic market, vigorously
+strengthened its efforts in targeted marketing and actively
+developed retail and end customers. By coordinating both
+domestic and international market, the Group arranged
+the wholesale and export of refined oil on a reasonable
+basis; in addition to optimizing the allocation and
+distribution of refined oil, the Group also endeavoured to
+control the marketing expenses. In 2021, the Marketing
+segment recorded an operating profit of RMB13,277
+million, representing an increase of RMB16, 183 million, as
+compared with last year.
+Natural Gas and Pipeline
+Revenue The revenue of the Natural Gas and
+Pipeline segment amounted to RMB417,022 million for
+2021, representing an increase of 12.5% as compared with
+2021 ANNUAL REPORT 029
+DISCUSSION AND ANALYSIS OF OPERATIONS
+last year, primarily due to the increase in both sales volume
+and price of natural gas.
+Operating Expenses Operating expenses of
+the Natural Gas and Pipeline segment amounted to
+RMB373,057 million for 2021, representing an increase of
+25.0% as compared with last year, primarily due to the
+increase in the expenditure of natural gas purchase.
+Profit from Operations In 2021, the Natural Gas and
+Pipeline segment, by taking advantage of stable growth of
+domestic economy and market demand recovery, actively
+developed direct sales and end customers, continuously
+improved service quality, and strived to increase sales
+volume. The Group vigorously strengthened control over
+the natural gas procurement cost and continued to improve
+sales profitability. The Group successfully completed
+the closing of the equity transfer in the pipeline assets
+of Kunlun Energy. The operating profit was RMB43,965
+million, representing a decrease of 39.3% as compared
+with last year, which was primarily due to the decrease of
+the revenue from the pipeline asset restructuring of 2021
+as compared with that of 2020. In 2021, the imported
+natural gas business of the Group recorded a loss of
+RMB7,212 million, representing a reduction in loss of
+RMB6,947 million as compared with last year. The Group
+will take effective measures to continue its efforts to control
+the loss of its imported natural gas business.
+Note: The four operating segments of the Group are Exploration
+and Production, Refining and Chemicals, Marketing as well
+as Natural Gas and Pipeline. International operations do not
+constitute a separate operating segment of the Group. The
+financial data of international operations are included in the
+financial data of respective operating segments mentioned
+above.
+21,810
+2,021,695
+(1.2)
+626
+0.25
+800
+0.33
+Total
+251,178
+100.00
+246,493
+100.00
+242,000
+100.00
+* If investments related to geological and geophysical exploration costs are included, the capital expenditures for the Exploration and
+Production segment for each of 2021 and 2020 and the estimated amount for 2022 would be RMB189,951 million, RMB197,019 million
+and RMB193,200 million, respectively.
+2021 ANNUAL REPORT
+033
+DISCUSSION AND ANALYSIS OF OPERATIONS
+0.28
+BEN 2022
+700
+3.30
+44,500
+18.39
+Marketing
+10,982
+4.37
+16,294
+6.61
+7,500
+3.10
+Natural Gas and Pipeline
+6,750
+2.69
+21,143
+8.58
+8,000
+Head Office and Other
+Non-current assets
+Hi
+Exploration and Production
+2021 ANNUAL REPORT 035
+DISCUSSION AND ANALYSIS OF OPERATIONS
+中国石油
+T-1201
+2. The financial data set out below is extracted from the audited financial statements of the
+Group prepared under CAS
+(1) Financial Data Prepared under CAS
+Total assets
+Current assets
+As at December
+31, 2021
+As at December
+31, 2020
+Percentage of
+Change
+RMB million
+2,488,400
+%
+0.6
+480,838
+486,767
+It is estimated that the capital expenditures for the
+Head Office and Other segment of the Group for 2022
+will be RMB800 million, which will be used primarily for
+improvement of research facilities and construction of the
+IT system.
+22511
+Capital expenditures for the Head Office and Other
+segment for 2021 were RMB700 million, which were
+primarily used for improvement of scientific research
+facilities and construction of the IT system.
+It is estimated that the capital expenditures for the
+Marketing segment for 2022 will be RMB7,500 million
+Capital expenditures for the Exploration and
+Production segment for 2021 amounted to RMB178,259
+million, which were primarily used for the exploration
+and development with scale benefit and profitability in
+key domestic basins such as Songliao, Ordos, Junggar,
+Tarim, Sichuan and Bohai Bay, devoting greater efforts in
+the exploration of unconventional resources such as shale
+gas and shale oil, promoting new energy projects such
+as alternative clean energy projects; and exploration,
+development and operation of existing projects in overseas
+cooperation areas such as the Middle East, Central Asia,
+America and the Asia Pacific region.
+It is estimated that the capital expenditures for
+the Exploration and Production segment for 2022 will
+be RMB181,200 million, which will be primarily for the
+continuously exploration and development with scale
+benefit and profitability in key domestic basins such
+as Songliao, Ordos, Junggar, Tarim, Sichuan and
+Bohai Bay, devoting greater efforts in the exploration of
+unconventional resources such as shale gas and shale oil,
+promoting new energy projects including clean electricity
+and CCUS. In adherence to the principle of optimised
+development, overseas operations will continue to focus
+on the operation of existing projects in cooperation areas
+such as the Middle East, Central Asia, America and the
+Asia Pacific region when seeking opportunities to obtain
+high-quality new projects.
+034 PETROCHINA COMPANY LIMITED
+DISCUSSION AND ANALYSIS OF OPERATIONS
+PetroChina
+Refining and Chemicals
+Capital expenditures for the Group's Refining and
+Chemicals segment for 2021 amounted to RMB54,487
+million, which were primarily used for Guangdong
+Petrochemical integration. project of refining and
+chemicals, Changqing and Tarim ethane-to-ethylene
+projects, and other expansion and construction of large-
+scale refining and chemical projects such as ethylene,
+as well as transformation and upgrading projects related
+to refining reduction and chemical increase and new
+materials and new technologies.
+It is estimated that the capital expenditures for
+the Refining and Chemicals segment for 2022 will be
+RMB44,500 million, which will be used primarily for
+Guangdong Petrochemical integration project of refining
+and chemicals, the construction of large-scale refining
+and chemical projects such as Jilin Petrochemical and
+Guangxi Petrochemical Ethylene projects, as well as
+transformation and upgrading projects related to refining
+reduction and chemical increase and new materials and
+new technologies.
+used primarily for the network expansion for the sales
+of end-products within the domestic refined oil markets,
+expansion of new energy projects such as hydrogen
+refuelling stations and the equipment construction of
+overseas oil and gas storage and sales.
+Natural Gas and Pipeline
+Capital expenditures for the Group's Natural Gas
+and Pipeline segment for 2021 amounted to RMB6,750
+million, which were mainly used for construction of LNG
+receiving stations, natural gas branch lines, market
+development projects for urban gas terminals, and new
+energy collaborative projects such as natural gas power
+generation.
+It is estimated that capital expenditures for the Natural
+Gas and Pipeline segment for 2022 will be RMB8,000
+million, which will be used primarily for construction of
+LNG receiving stations, natural gas branch lines, market
+development projects for urban gas terminals, and the
+integration project of natural gas power generation and
+new energy, etc.
+Marketing
+Capital expenditures for the Group's Marketing
+segment for 2021 amounted to RMB10,982 million, which
+were mainly used for the network for the sales of end-
+products within the domestic refined oil markets, expansion
+of new energy projects such as hydrogen fuelling stations
+and the equipment construction of overseas oil and gas
+storage and sales.
+Head Office and Other
+exploration and development, as a result, the natural gas
+output increased at a rapid pace with both output and
+profit rising. In overseas business, the Group also actively
+carried out follow-up evaluation of the profitability of oil and
+gas projects, and strived to optimize the asset structure.
+It continued to strengthen cost management and control
+and continuously enhanced its ability to create profitability.
+In 2021, the Exploration and Production segment realised
+an operating profit of RMB68,452 million, representing an
+increase of 196.4% as compared with last year.
+As at
+41,575
+Taxation of the PRC (Guo Shui Han [2011] No.348) (
+稅務總局國稅函[2011]348號), the Company is required to
+withhold and pay the individual income tax for its individual
+H shareholders and the individual H shareholders are
+entitled to certain tax preferential treatments according
+to the tax agreements between those countries where the
+individual H shareholders are residents and China and
+the provisions in respect of tax arrangements between the
+China's mainland and Hong Kong (Macau). The Company
+would withhold and pay the individual income tax at the tax
+According to the Notice on Issues Concerning the
+Collection and Management of Individual Income Tax after
+the Abolition of Guo Shui Fa [1993] No. 045 ( «HAIH
+發[1993]045號文件廢止後有關個人所得税征管問題的通
+promulgated by the State General Administration of
+) and the relevant implementing rules which came
+into effect on January 1, 2008, amended on February 24,
+2017 and December 29, 2018, the Company is required
+to withhold corporate income tax at the rate of 10%
+before distributing dividends to non-resident enterprise
+shareholders whose names appear on the register of
+members of H shares of the Company. Any H shares
+registered in the name of non-individual shareholders,
+including HKSCC Nominees Limited, other nominees,
+trustees or other groups and organisations will be treated
+as being held by non-resident enterprise shareholders and
+therefore will be subject to the withholding of the corporate
+income tax. Should any holder of H shares wish to change
+their shareholder status, please consult their agent or trust
+institution over the relevant procedures. The Company will
+withhold payment of the corporate income tax strictly in
+accordance with the relevant laws or requirements of the
+relevant governmental departments and strictly based
+on the information registered on the Company's H share
+register of members on June 27, 2022.
+According to the Law on Corporate Income Tax of the
+People's Republic of China ( «+\\*K
+the Southbound Trading Link on behalf of investors and
+assist the payment of dividends on the H Shares under the
+Southbound Trading Link to investors thereof.
+In accordance with the relevant provisions of the
+Articles of Association and relevant laws and regulations,
+dividends payable to the Company's shareholders shall
+be declared in Renminbi. Dividends payable to the
+holders of A shares shall be paid in Renminbi, and for the
+A shares of the Company listed on the Shanghai Stock
+Exchange and invested by the investors through the
+Hong Kong Stock Exchange, dividends shall be paid in
+Renminbi to the accounts of the nominal shareholders
+through CSDC. Save for the H shares of the Company
+listed on the Hong Kong Stock Exchange and invested
+by the investors through the Shanghai Stock Exchange
+and the Shenzhen Stock Exchange (the "H Shares under
+the Southbound Trading Link"), dividends payable to the
+holders of H shares shall be paid in Hong Kong Dollar.
+The applicable exchange rate shall be the average of the
+medium exchange rate for Renminbi to Hong Kong Dollar
+as announced by the People's Bank of China for the week
+prior to the declaration of the dividends at the annual
+general meeting to be held on June 9, 2022. Dividends
+payable to the holders of H Shares under the Southbound
+Trading Link shall be paid in Renminbi. In accordance
+with the Agreement on Payment of Cash Dividends on the
+H Shares under the Southbound Trading Link (
+H股股票現金紅利派發協議》)between the Company and
+CSDC, CSDC will receive the dividends payable by the
+Company to holders of the H Shares under the Southbound
+Trading Link as a nominal holder of the H Shares under
+2022 (both days inclusive) during which period no transfer
+of H shares will be registered. In order to qualify for the
+final dividend, holders of H shares must lodge all transfer
+documents together with the relevant share certificates at
+Hong Kong Registrars Limited at or before 4:30 p.m. on
+June 21, 2022. Holders of A shares whose names appear
+on the register of members of the Company maintained
+at China Securities Depository and Clearing Corporation
+Limited ("CSDC") at the close of trading on the Shanghai
+Stock Exchange in the afternoon of June 27, 2022 are
+eligible for the final dividend. The final dividend of A shares
+and H shares for 2021 will be paid on or about June 28,
+2022 and July 29, 2022, respectively.
+SIGNIFICANT EVENTS
+2021 ANNUAL REPORT 039
+After overall consideration of the Company's operating
+results, financial position and cash flow, etc. and in return
+for the shareholders, the Board recommends a final cash
+dividend of RMB0.09622 yuan (inclusive of applicable tax)
+per share for 2021 to all shareholders. The total amount of
+cash dividends reaches RMB17.61 billion. The proposed
+final dividend is subject to shareholders' review and
+approval at the forthcoming 2021 annual general meeting
+to be held on June 9, 2022. The final dividend of H shares
+will be paid to all shareholders of H shares whose names
+appear on the register of members of the Company at the
+close of trading on June 27, 2022. The register of members
+of H shares will be closed from June 22, 2022 to June 27,
+2. Distribution Plan for the Final Dividend for
+2021
+the Company is welcomed by the shareholders. The
+independent directors of the Company have performed
+their duties faithfully and diligently, formed opinions on
+dividend distribution independently and objectively, and
+played a desirable role. The Company distributed 45%
+of its net profit attributable to owners of the Company as
+dividend.
+Since its listing, the Company has strictly complied
+with the Articles of Association and relevant regulatory
+requirements, and made decision on dividend distribution
+adopting the principle of returns to shareholders.
+The steady and active dividend distribution policy of
+To safeguard the interests of vast shareholders, it is
+provided by the Company in the Articles of Association
+of PetroChina Company Limited ("Articles of Association")
+that in the premise that the net profit attributable to owners
+of the Company and the accumulated undistributed profit
+for the year are positive, and the Company's cash flow can
+satisfy the normal operation and sustainable development
+of the Company, the amount of cash dividend to be
+distributed shall not be less than 30% of the net profit
+attributable to owners of the Company realised in the
+relevant year. The Company distributes dividends twice a
+year, with the final dividend to be determined by the general
+meeting by ordinary resolution and the interim dividend
+determined by the Board of Directors as authorised by the
+general meeting by way of ordinary resolution.
+Formulation and implementation of the cash dividend
+policy of the Company
+Net profit means historical data of profit attributable to owners of the Company in the year as calculated in accordance with the IFRS
+45.0
+92,170
+41,476
+040 PETROCHINA COMPANY LIMITED
+168.4
+SIGNIFICANT EVENTS
+rate of 10% on behalf of the individual H shareholders who
+are Hong Kong residents, Macau residents or residents
+of those countries having agreements with China for
+individual income tax rate in respect of dividend of 10%.
+For individual H shareholders who are residents of those
+countries having agreements with China for individual
+income tax rates in respect of dividend of lower than 10%,
+the Company would make applications on their behalf
+to seek entitlement of the relevant agreed preferential
+treatments pursuant to the circular of State Administration
+of Taxation on Issuing Administrative Measures on
+Preferential Treatment Entitled by Non-residents
+Taxpayers under Tax Treaties (SAT Circular [2019] No.35)
+(《關於發布<非居民納稅人享受協定待遇管理辦法>的公
+告》(國家稅務總局公告2019年第35號)). For individual_H
+shareholders who are residents of those countries having
+agreements with China for individual income tax rates in
+respect of dividend of higher than 10% but lower than
+20%, the Company would withhold the individual income
+tax at the agreed-upon effective tax rate. For individual H
+shareholders who are residents of those countries without
+any taxation agreements with China or having agreements
+with China for individual income tax in respect of dividend
+of 20% or in other situations, the Company would withhold
+the individual income tax at a tax rate of 20%.
+Book value Profit or in equity
+as at the loss in the in the
+end of the reporting reporting
+year period period
+Share-
+Number of holding
+shares held (%)
+Initial
+short Investment
+name amount
+Stock
+code
+Stock
+Change
+Unit: HK Dollars million
+As at the end of the reporting period, interests in other listed securities held by the Group were as follows:
+(1) Shareholding interests in other listed companies
+3. Shareholding in other companies
+file tax withholding returns with the competent tax authority.
+Where there is any tax resident of a foreign country out
+of the Hong Kong investors and the rate of income tax
+on dividends is less than 10%, as provided for in the tax
+treaty between the country and the PRC, the enterprise or
+individual may personally, or entrust a withholding agent
+to, file an application for the tax treatment under the tax
+treaty with the competent tax authority of the Company.
+Upon review, the competent tax authority will refund tax
+based on the difference between the amount of tax having
+been collected and the amount of tax payable calculated
+at the tax rate as set out in the tax treaty.
+With regard to the dividends obtained by the investors
+(including enterprises and individuals) from investment in
+the A shares of the Company listed on Shanghai Stock
+Exchange through the Hong Kong Stock Exchange, the
+Company will withhold income tax at the rate of 10%, and
+withhold tax with reference to the provisions concerning
+the collection of tax on individual investors. The Company
+I will not withhold income tax on dividends obtained by
+mainland enterprise investors, and mainland enterprise
+investors shall file their income tax returns and pay tax
+themselves instead.
+SIGNIFICANT EVENTS
+2021 ANNUAL REPORT 041
+In accordance with the Notice of Ministry of Finance,
+the State Administration of Taxation, and the China
+Securities Regulatory Commission on Taxation Policies
+concerning the Pilot Program of an Interconnection
+Mechanism for Transactions in the Shanghai and Hong
+Kong Stock Markets (Cai Shui [2014] No.81) (YK¥ ·
+國家稅務總局、證監會關於滬港股票市場交易互聯互通
+機制試點有關稅收政策的通知》(财税〔2014〕81號))
+which became effective on November 17, 2014, and the
+Notice of the Ministry of Finance, the State Administration of
+Taxation, and the China Securities Regulatory Commission
+on Taxation Policies concerning the Pilot Program of
+an Interconnection Mechanism for Transactions in the
+Shenzhen and Hong Kong Stock Markets (Cai Shui [2016]
+No. 127)(《財政部、國家稅務總局、證監會關於深港股票
+市場交易互聯互通機制試點有關稅收政策的通知》(财税
+[2016]127)), which became effective on December 5,
+2016, with regard to the dividends obtained by individual
+mainland investors from investment in the H shares of
+the Company listed on the Hong Kong Stock Exchange
+through the Shanghai-Hong Kong and Shenzhen-Hong
+Kong Stock Connect, the Company will withhold their
+individual income tax at the rate of 20% in accordance with
+the register of individual mainland investors provided by
+CSDC. As to the withholding tax having been paid abroad,
+an individual investor may file an application for tax credit
+with the competent tax authority of CSDC with an effective
+credit document. With respect to the dividends obtained
+by mainland securities investment funds from investment
+in the H shares of the Company listed on the Hong Kong
+Stock Exchange through the Shanghai-Hong Kong and
+Shenzhen-Hong Kong Stock Connect, the Company will
+The Company will not entertain any claims arising
+from and assume no liability whatsoever in respect of any
+delay in, or inaccurate determination of, the status of the
+shareholders of the Company or any disputes over the
+withholding and payment of tax.
+country of domicile of the individual H shareholder based
+on the recorded Registered Address on June 27, 2022.
+The Company will determine the country of domicile
+of the individual H shareholders based on the registered
+address as recorded in the register of members of the
+Company (the "Registered Address") on June 27, 2022
+and will accordingly withhold and pay the individual
+income tax. If the country of domicile of an individual H
+shareholder is not the same as the Registered Address,
+the individual H shareholder shall notify the share
+registrar of the Company's H shares and provide relevant
+supporting documents on or before 4:30 p.m. June 21,
+2022 (address: Hong Kong Registrars Limited, Shops
+1712-1716, Hopewell Centre, 183 Queen's Road East,
+Wanchai, Hong Kong). If the individual H shareholder
+does not provide the relevant supporting documents to
+the share registrar of the Company's H shares within the
+time period stated above, the Company will determine the
+PetroChina
+19,006
+32,000
+57.6
+9,242
+2,905
+12,147
+50.00
+USD131
+(610)
+Co., Ltd.
+2,339
+10,537
+12,876
+50.00
+1,000
+China Marine Bunker (PetroChina)
+424
+6,959
+4,759
+11,718
+49.00
+5,000
+2,114
+Mangistau Investment B.V.
+million
+Trans-Asia Gas Pipeline Co., Ltd.
+Percentage of Net Profit (%)
+Net Profit of the Year*
+45,682
+26,293
+Amount (inclusive of tax)
+Unit: RMB million
+PetroChina
+SIGNIFICANT EVENTS
+2021
+2020
+135
+2019
+1. Cash Dividend in the Recent Three Years
+SIGNIFICANT EVENTS
+038 PETROCHINA COMPANY LIMITED
+4,067
+42,818
+2,630
+45,448
+50.00
+5,000
+Year
+KUNLUN
+ENERGY(1)
+25,802 4,708,302,133
+54.38
+SIGNIFICANT EVENTS
+044 PETROCHINA COMPANY LIMITED
+During the reporting period, the Company and its
+controlling shareholder and ultimate controller, CNPC,
+10. Creditworthiness of the Company and
+its controlling shareholder and ultimate
+controller
+The incumbent Directors, Supervisors and senior
+management of the Company and those who retired during
+the reporting period did not receive the punishment from
+the securities regulation organisations in recent three years.
+During the reporting period, none of the Company
+or its current Directors, Supervisors, senior management,
+controlling shareholder or ultimate controller of the
+Company was subject to any investigation by the
+competent authorities or enforcement by judicial or
+disciplinary departments, or was handed over to judicial
+departments or subject to criminal liability, or subject
+to investigation or administrative penalty by the China
+Securities Regulatory Commission, or any denial of
+participation in the securities market or was deemed
+unsuitable to act as directors, or was imposed on material
+punishment by other administrative authorities or was
+subject to any public criticisms made by a stock exchange.
+9. Penalties on the Company and its
+Directors, Supervisors, senior management,
+controlling shareholder and ultimate
+controller and remedies thereto
+During the reporting period, the Company has no
+material litigations or arbitrations.
+According to the relevant regulations of the Ministry
+of Finance of the People's Republic of China and the State-
+owned Assets Supervision and Administration Commission
+of the State Council, the Company shall rotate accounting
+firms that have served continuously for more than a
+certain number of years. KPMG Huazhen LLP (Special
+General Partnership) and KPMG retired and will not be re-
+appointed as the domestic and international auditors of the
+Company after the conclusion of the 2020 annual general
+meeting of the Company. Meanwhile, as approved at the
+2020 annual general meeting, the Company engaged
+PricewaterhouseCoopers Zhong Tian LLP (Special
+General Partnership) and PricewaterhouseCoopers
+to serve as the domestic and international auditors,
+respectively, for the year of 2021. Remuneration in respect
+of the 2021 audit work amounted to RMB47 million, mainly
+for the provision of auditing services for the Company's
+domestic and international needs, in which the financial
+report auditing fee amounted to RMB39 million and the
+financial report internal control auditing fee amounted to
+RMB8 million. For details of the auditors' remuneration,
+please refer to Note 7 to the financial statements prepared
+in accordance with IFRS in this annual report.
+7. Engagement and disengagement of firm
+of accountants
+Save for the above undertakings, there is no material
+undertakings given by the Company, any shareholders,
+ultimate controllers, purchasers, Director, Supervisor or
+senior management or other related parties during the
+reporting period.
+8. Material litigation and arbitration
+As at the end of the reporting period, Pricewaterhouse-
+Coopers Zhong Tian LLP (Special General Partnership)
+and PricewaterhouseCoopers have provided audit service
+to the Company for one year.
+Save for the above additional undertakings, undertakings
+made by CNPC in the Agreement remain unchanged.
+Agreement. Subject to the applicable laws, contractual
+agreements and procedure requirements, CNPC will sell
+to the Company offshore oil and gas assets as described
+in items (1) and (2) above at the request of the Company.
+SIGNIFICANT EVENTS
+2021 ANNUAL REPORT 043
+In connection with matters described above, CNPC
+issued a Letter of Undertaking to the Company on
+June 20, 2014 and made additional undertakings that:
+(1) within ten years from the date of the Letter of
+Undertaking, after taking into account of political, economic
+and other factors, the Company may request CNPC to sell
+offshore oil and gas assets which remain in possession
+by CNPC as at the date of the Letter of Undertaking;
+(2) for business opportunities relating to investment in
+offshore oil and gas assets after the date of the Letter of
+Undertaking, the relevant prior approval procedure of the
+Company shall be initiated strictly in accordance with the
+In order to support the business development of
+the Company, consolidate the relevant quality assets
+and avoid industry competition, CNPC, the controlling
+shareholder of the Company, entered into the Agreement
+on Non-Competition and Pre-emptive Right to Transactions
+(the "Agreement") with the Company on March 10, 2000.
+As at the end of the reporting period, except for those
+already performed, the undertakings not performed by
+CNPC included the following: (1) due to the fact that the
+laws of the jurisdiction where ADSS are listed prohibit
+local citizens from directly or indirectly financing or
+investing in the oil and gas projects in certain countries,
+CNPC failed to inject the overseas oil and gas projects
+in certain countries into the Company; (2) after execution.
+of the Agreement, CNPC obtained certain business
+opportunities that competed or were likely to compete
+with the principal business of the Company, which is not in
+strict compliance with the Agreement. Nevertheless, such
+industry competition primarily concentrated on oil and
+gas exploration and development operations at certain
+overseas countries and regions in which the resources
+owned by CNPC were insufficient or uncertain.
+PetroChina
+carried out various businesses in a continuous and steady
+way, adhering to the philosophy of good faith and the
+principle of compliance with laws and regulations, and did
+not incur any unperformed material court judgement that
+had come into force or any significant outstanding debt
+that had become due and payable.
+11. Other Significant Matters
+(1) Completion of the Closing of the Transfer of Equity
+Interest in Kunlun Energy Pipeline Assets
+046 PETROCHINA COMPANY LIMITED
+On June 7, 2021, NDRC issued the "Notice on Printing
+and Distributing the 'Measures for the Administration of
+the Natural Gas Pipeline Transportation Prices (Interim)'
+and the 'Measures for the Supervision and Review of
+the Pricing Cost of Natural Gas Pipeline Transportation
+(Interim) (NDRC Price Regulations [2021] No. 818)
+(《關於印發〈天然氣管道運輸價格管理辦法(暫行)〉和
+〈天然氣管道運輸定價成本監審辦法(暂行)〉的通知》
+((2021) 818)), which further improved the
+pricing mechanism for natural gas pipeline transportation,
+being "permitted cost plus reasonable profit", and
+standardized the supervision and review of pricing cost of
+natural gas pipeline transportation. The new measures was
+implemented on January 1, 2022 and will be valid for 8 years.
+(5) China Issued Policies on Natural Gas Pipeline
+Transportation Prices
+This event did not affect the continuity of the business
+and the stability of management of the Group, and was
+conducive to the sustainable and healthy development
+of the Group and achieving sustainable and positive
+operating results in the long term.
+and LNG) imported through the construction projects of
+cross-border natural gas pipelines and imported LNG
+receiving, storage and transportation equipment that have
+been examined and approved by the NDRC, as well as
+the expansion project of imported LNG receiving, storage
+and transportation equipment that have been approved
+by the provincial government, the import value-added
+tax will be refunded at a certain percentage. The specific
+refund ratios are as follows: (1) for imported natural gas
+under the long-term trade gas contract signed before the
+end of 2014 and confirmed by NDRC, the import value-
+added tax will be refunded at a rate of 70%; (2) for other
+natural gas, if the import price is higher than the reference
+benchmark value, the import value-added tax will be
+refunded according to the inverted ratio of the import
+price and the reference benchmark value.
+Utilization of Energy Resources during the 14th Five-Year
+Plan Period" (Cai Guan Shui [2021] No.18) ( ( "+
+五”期間能源資源勘探開發利用進口税收政策管理辦法的
+A) (VHK (2021] 18)), which stipulated that from
+January 1, 2021 to December 31, 2025, for specific oil and
+natural gas exploitation and development projects, the
+offshore oil and gas pipeline emergency rescue projects
+and the coal-bed methane exploration and development
+projects, the import of equipment, instruments, spare parts
+and special purpose tools that meet the requirements shall
+be exempted from import tariffs and import value-added
+taxes; for the natural gas (including pipeline natural gas
+On April 12, 2021, the Ministry of Finance, the
+General Administration of Customs, and the State Taxation
+Administration issued the "Notice on Import Tax Policies
+for the Exploration, Development and Utilization of Energy
+Resources during the 14th Five-Year Plan Period" (Cai
+Guan Shui [2021]No.17)(《關於“十四五”期間能源資
+源勘探開發利用進口稅收政策的通知》(財關稅〔2021〕17
+)), and on April 16, 2021, the Ministry of Finance, NDRC,
+the Ministry of Industry and Information Technology, the
+General Administration of Customs, the State Taxation
+Administration, and the National Energy Administration
+issued the "Notice on the Administrative Measures for
+Import Tax Policies for the Exploration, Development and
+(4) China Issued Import Tax Policy for Exploration,
+Development and Utilization of Energy Resources During
+the "14th Five-Year Plan" Period
+This event did not affect the continuity of the business
+and the stability of management of the Group, and was
+conducive to the sustainable and healthy development
+of the Group and achieving sustainable and positive
+operating results in the long term.
+6. Performance of Undertakings
+海關總署 稅務總局公告2021年第19號)), which stipulated
+that from June 12, 2021, for imported products that are
+classified under specific tariff codes and satisfy the
+regulations, they will be treated respectively as naphtha
+and fuel oil that will be levied for import consumption tax.
+2021 ANNUAL REPORT 045
+On May 12, 2021, the Ministry of Finance, the
+General Administration of Customs, and the State Taxation
+Administration issued the “Announcement on Imposing
+Import Consumption Taxes on Certain Refined Products"
+(MOF, GAC and SAT Announcement No. 19 of 2021)
+(《關於對部分成品油徵收進口環節消費稅的公告》(財政部
+(3) China Strengthened Administration on the
+Collection of Consumption Tax on Imported Refined Oil
+Products
+This event did not affect the continuity of the business
+and the stability of management of the Group, and was
+conducive to the sustainable and healthy development
+of the Group and achieving sustainable and positive
+operating results in the long term.
+In order to accelerate the upgrading and
+transformation of the Company's business and enhance
+its investment in strategic emerging industries, upon
+deliberation and approval at the ninth meeting of the
+eighth session of the Board of the Company on April 29,
+2021, that the Company, together with CNPC and CNPC
+(2) Participation in the Establishment of Industrial
+Capital Investment Company
+This event did not affect the continuity of the business
+and the stability of management of the Group, and was
+conducive to the sustainable and healthy development
+of the Group and achieving sustainable and positive
+operating results in the long term.
+Capital Company Limited, contributed RMB2.9 billion,
+RMB5.1 billion and RMB2.0 billion respectively to jointly
+establish CNPC Kunlun Capital Company Limited ("Kunlun
+Capital"). The business scope of Kunlun Capital includes:
+equity investment, investment management and asset
+management through private equity funds (subject to the
+registration and filing to Asset Management Association
+of China); private equity investment fund management
+and venture capital fund management services (subject
+to the registration and filing to Asset Management
+Association of China); investment activities with its own
+funds (non-financial investment); venture capital (limited
+to investment in unlisted companies); financing consulting
+services; financial consulting; and business management
+consulting (general business items can be carried out
+independently; the carrying out of licensed business items
+is subject to the relevant license or authorization) (for the
+items subject to approval in accordance with the laws,
+business activities can be carried out only after obtaining
+approval from relevant authorities). For details, please refer
+to the announcements published by the Company on the
+website of the Shanghai Stock Exchange (Announcement
+No. Lin 2021-012, Lin 2021-017) and the announcement
+published on the website of the Hong Kong Stock
+Exchange on April 29, 2021 and June 24,2021.
+Pursuant to the Equity Transfer Agreement dated
+December 22, 2020 entered into between Kunlun Energy,
+being a subsidiary of the Company, and PipeChina, all
+rights, obligations, responsibilities and risks relating to
+60% equity interest held by Kunlun Energy in PetroChina
+Beijing Gas Pipeline Co., Ltd. (the "Beijing Pipeline")
+and 75% equity interest in PetroChina Dalian LNG Co.,
+Ltd. (the "Dalian LNG") have been transferred from
+Kunlun Energy to PipeChina. For details, please refer to
+the announcements published by the Company on the
+website of the Shanghai Stock Exchange (Announcement
+No. Lin 2021-008) and the announcement published on
+the website of the Hong Kong Stock Exchange on April
+1,2021, respectively.
+SIGNIFICANT EVENTS
+CNPC Captive Insurance Co., Ltd.
+(6) Save as disclosed in this annual report, during
+the reporting period, the Company did not enter into any
+material contract which requires disclosure.
+(4) The Company had no material external entrustment
+loans during the reporting period.
+1,823
+25,033
+9,917 5,246,490,000 32.00
+Finance
+CNPC
+Classification Source of
+in accounts shareholding
+Change in
+equity in the
+reporting
+period
+Profit or
+loss in the
+reporting
+period
+year
+Book value
+as at the
+end of the
+Share-
+Number of holding
+shares held (%)
+Initial
+investment
+amount
+target
+investment
+Unit: RMB million
+(2) Shareholding of interests in non-listed financial institutions
+Note: (1)The Group held the shares in Kunlun Energy Limited through PetroChina Hong Kong Limited, an overseas wholly-owned subsidiary
+of the Company. The shares of Kunlun Energy are listed on the Hong Kong Stock Exchange.
+Classification Source of
+in accounts shareholding
+Long- Acquisition
+term equity and further
+investments issue of shares
+25,802
+919
+CNPC Captive
+Insurance
+Co., Ltd.
+(3) The Company did not entrust any other person on
+material wealth management during the reporting period.
+(2) As of the end of the reporting period, the Company
+and its subordinate companies (including the companies
+wholly-owned or controlled by the Company, the same
+below) had a guarantee balance of RMB188.192 billion,
+including RMB23.750 billion for credit guarantee and
+RMB153.785 billion for performance guarantee, RMB10.657
+billion for financing guarantee, and the balance of
+guarantees as of the end of the reporting period accounted
+for approximately 13.35% of the Group's net asset. The
+guarantee balance of the Company as of the end of the
+reporting period did not exist for the guarantee provided
+to the controlling shareholder, the ultimate controller and its
+related parties.
+the year.
+(1) During the reporting period, there were no
+trusteeship, sub-contracting and leasing of properties of
+other companies by the Company which would contribute
+profit to the Company of 10% or more of its total profit for
+5. Material contracts and the performance
+thereof
+Please refer to the section "Connected Transactions"
+in this annual report. During the reporting period, no
+substantial shareholder of the Company has utilized the
+funds of the Company for non-operating purposes.
+4. Significant connected transactions during
+the reporting period
+PetroChina
+SIGNIFICANT EVENTS
+(5) The Company had no overdue principals or
+interests of material bank loans during the reporting period.
+PETROCHINA COMPANY LIMITED
+Injection of
+capital
+term equity Establishment
+investment by promotion
+Long -
+investment
+Long-
+term equity
+129
+207
+3,410
+2,450 2,450,000,000 49.00
+042
+(the "CNPC Finance")
+Name of
+77,139
+36.1
+12.8
+(1,646,471)
+2,005,006
+2,551,738
+(1,639,119)
+(24.7)
+(39.1)
+223
+(2.9)
+16.9
+13.1
+5.6
+387,041
+410,226
+300
+(0.4)
+46.0
+45.4
+3.1
+2,075,302
+35.0
+2.1
+* Margin = Profit from principal operations / Income from principal operations
+2021 ANNUAL REPORT
+Percentage of
+35.2
+37.0
+34.1
+%
+Percentage of
+Change
+721,015
+1,933,836
+1,212,821
+2020
+RMB million
+2,143,071
+987,733
+2,614,349
+2021
+Total
+Other
+China's mainland
+RMB million
+Revenue from transactions with third parties
+(3) Principal operations by region under CAS
+DISCUSSION AND ANALYSIS OF OPERATIONS
+037
+1,626,616
+Non-current assets *
+4.4
+26.3
+Total
+Elimination
+2021
+Increase or
+income from change in cost
+Year-on-year
+Year-on-year
+change in
+Cost of
+principal
+operations
+for the year
+for the year
+principal
+operations
+Income from
+(2) Principal operations by segment under CAS
+For reasons for changes, please read of the "Asset, Liabilities and Equity" part of the Discussion and Analysis of
+Operations section of this annual report.
+PetroChina
+DISCUSSION AND ANALYSIS OF OPERATIONS
+HKD7,592
+(the "CNPC E&D")
+8,413
+6,304
+Exploration and Production
+Refining and Chemicals
+Marketing
+Natural Gas and Pipeline
+Head Office and Other
+=
+RMB
+million
+8.9
+698,114
+967,723
+4.1
+22.3
+30.7
+21.4
+490,797
+669,537
+23.2
+points
+%
+%
+Percentage
+decrease in
+margin
+operations
+of principal
+principal
+operations
+Margin*
+2021
+RMB
+million
+%
+China's mainland
+158,507
+Total
+150,427
+100.00
+18,096
+PetroChina International Co., Ltd.
+(72,363) (19,457)
+146,386
+74,023
+100.00
+31,314
+Company Limited
+PetroChina International Investment
+million
+PetroChina Hong Kong Limited
+28,557
+94,430
+54,346
+148,776
+100.00
+200,082
+72,347
+6,031
+PetroChina Sichuan Petrochemical
+10,000
+Other
+454,765
+531,904
+32.00
+8,331
+China Petroleum Finance Co., Ltd.
+Corporation (the "PipeChina")
+29,776
+615,103
+50.00
+239,393
+29.90
+500,000
+China Oil & Gas Pipeline Network
+Co., Ltd.
+3,383
+25,032
+4,258
+29,290
+90.00
+854,496
+16,100
+222,774
+CNPC Exploration and Development
+Amount
+Amount
+of total
+assets
+capital Shareholding
+Registered
+(4) Principal subsidiaries and associates of the Group under CAS
+* Non-current assets mainly include other non-current assets except financial instruments and deferred tax assets.
+1.2
+(13.5)
+190,785
+165,117
+2,003,885
+2.8
+%
+Change
+1,789,455
+RMB million
+December 31, 2020
+1,838,768
+Company Limited
+RMB million
+of total
+liabilities
+Amount of
+total net
+assets
+/(liabilities)
+1,980,240
+(loss)
+3,898
+226,684
+Net
+profit/
+365,574
+100.00
+47,500
+Daqing Oilfield Company Limited
+million
+million
+million
+138,890
+%
+million
+RMB
+RMB
+RMB
+RMB
+RMB
+Name of company
+million
+December 31, 2021
+The following annual caps in respect of the continuing connected transactions are set for the relevant transactions for
+the period from January 1, 2021 to December 31, 2023:
+During the current reporting period, the beginning
+balance of the Group's deposits with CNPC Finance is
+RMB33,275 million, with cash inflow of RMB3,616,743
+million and cash outflow of RMB3,619,890 million during
+the reporting period, and the end-of-period balance
+is RMB30, 128 million; the interest rate range of RMB is
+from 0.35% to 4.26%. The beginning balance of the loans
+provided by CNPC Finance to the Group is RMB68,045
+million, with new loans of RMB85, 195 million and repaid
+loans of RMB82,673 million during the reporting period,
+and the end-of-period balance is RMB70,567 million. The
+interest rate range of RMB is from 3.2% to 4.28%. the
+054 PETROCHINA COMPANY LIMITED
+CONNECTED TRANSACTIONS
+PetroChina
+During the effective term of the agreement, any party
+to any specific agreement relating to any one or more
+types of products or services can terminate such specific
+agreement at any time by a written notice of at least six
+months.
+amount of issuance of acceptance bill and discounting of bills from CNPC Finance for the Group is RMB13,615 million
+and RMB3,671 million, respectively. According to the Listing Rules, CNPC Finance is a connected person of the Company.
+The relevant transaction amounts for these continuing connected transactions have been included within the caps for the
+continuing connected transactions between the Group and CNPC.
+Caps for the Continuing Connected Transactions
+(IV) Ongoing connected transactions with CNPC
+Finance
+2023
+Category of Products and Services
+Proposed annual caps
+2021
+2022
+RMB million
+(i) Products and services provided by the Group to the CNPC/jointly-held entities
+(ii) Products and services provided by CNPC/jointly-held entities to the Group
+(a) Engineering technology services
+150,000
+147,200 144,600
+(b) Production services
+(c) Material supply services
+On August 27, 2020, the Group renewed a product
+and service agreement with Beijing Gas, pursuant to
+which the Group would provide products and services
+for Beijing Gas on a continuing basis, including but not
+limited to the provision of natural gas and related pipeline
+transmission services. The agreement would be effective
+from January 1, 2021 to December 31, 2023. The details
+of the transaction were published on the website of Hong
+Kong Stock Exchange and Shanghai Stock Exchange on
+August 27, 2020, and please also refer to the connected
+transaction sections in 2020 annual report published
+on Hong Kong Stock Exchange and Shanghai Stock
+Exchange on March 25, 2021, respectively, and the
+material connected transactions section in 2021 interim
+report published on the Hong Kong Stock Exchange and
+Shanghai Stock Exchange on August 26, 2021.
+(A) In relation to the products and services contemplated under (a) the Comprehensive Agreement, (b) Land Use
+Rights Leasing Contract and its supplemental contract, (c) Buildings Leasing Contract (amended), and (d) Beijing Gas
+Product and Services Agreement, the total annual revenue or expenditure in respect of each category of products and
+services will not exceed the proposed annual caps set out in the following table:
+Gas no longer constitutes a connected person of the
+Company. The transactions with Beijing Gas no longer
+constitute connected transactions.
+On August 24, 2017, the Company entered into a
+New Buildings Leasing Contract with CNPC, pursuant to
+which the Company agreed to lease from CNPC buildings
+with an aggregate gross floor area of approximately
+1,152,968 square metres and the annual rental was no
+more than RMB730 million. Meanwhile, the parties agreed
+to adjust the area of building leased and the rental fees
+every three years as appropriate by reference to the status
+of the production and operations of the Company, but the
+adjusted rental fees shall not exceed the comparable fair
+market price. The contract took effect as from January 1,
+2018 for a term of 20 years.
+(III) Continuing Connected Transactions with Beijing
+(d) Social and living services
+4. Buildings Leasing Contract (Amended)
+On August 27, 2020, the parties reconfirmed in a
+letter of confirmation that the area of the leased buildings
+was 1,287,486.41 square meters and the annual rental
+was adjusted to approximately RMB713 million. The letter
+of confirmation took effect as from January 1, 2021.
+the Contract for the Transfer of Rights under Production
+Sharing Contracts dated December 23, 1999. As part
+of the restructuring, CNPC transferred to the Company
+relevant rights and obligations under 28 production sharing
+contracts entered into with a number of international oil
+and natural gas companies, except for the rights and
+obligations relating to CNPC's supervisory functions.
+As of December 31, 2021, CNPC has been in
+the process of executing in aggregate 29 projects
+contemplated under the production sharing contracts,
+in respect all of which the transfer of rights under the
+production sharing contracts between CNPC and the
+Company has been completed. CNPC has assigned to
+the Company all of its rights and obligations under the
+production sharing contracts at nil consideration and
+subject to applicable PRC laws and regulations, except for
+the rights and obligations relating to CNPC's supervisory
+functions.
+5. Intellectual Property Licensing Contracts
+The Company and CNPC continue to implement the
+three intellectual property licensing contracts entered
+into on March 10, 2000, namely the Trademark Licensing
+Contract, the Patent and Know-how Licensing Contract
+and the Computer Software Licensing Contract. CNPC
+has agreed to extend the term of the Computer Software
+Licensing Contract to the expiry date of the statutory
+protection period of the relevant software or when such
+software enters the public domain. Pursuant to these
+licensing contracts, CNPC has granted the Company
+the exclusive right to use certain trademarks, patents,
+know-how and computer software of CNPC at no cost.
+These intellectual property rights relate to the assets
+and businesses of CNPC which were transferred to the
+Company pursuant to the restructuring.
+6. Contract for the Transfer of Rights under Production
+Sharing Contracts
+The Company and CNPC continue to implement
+Due to the fact that Beijing Gas was a substantial
+shareholder of Beijing Pipeline, a former subsidiary of the
+Company, and Beijing Pipeline constituted a significant
+subsidiary of the Group pursuant to the financial data
+of the Group for the year 2020, Beijing Gas was a
+connected person of the Company under Listing Rules.
+On December 22, 2020, the Company considered and
+passed the Proposal for Kunlun Energy's Pipeline Assets
+Transaction at the ninth Board meeting of 2020, approving
+the disposal of the 60% equity interest in Beijing Pipeline
+held by Kunlun Energy to PipeChina. On March 31, 2021,
+Kunlun Energy and PipeChina finished the closing of
+transfer of equity interest. Details of such transaction were
+published on the websites of Shanghai Stock Exchange
+(Announcement No. Lin 2021-008) and Hong Kong Stock
+Exchange on April 1, 2021, respectively. After the equity
+disposal closing was completed, the Group no longer
+holds any equity interest in Beijing Pipeline and Beijing
+As each of the applicable percentage ratio(s) (other
+than the profits ratio) in respect of the Trademark Licensing
+Contract, the Patent and Know-how Licensing Contract, the
+Computer Software Licensing Contract and the Contract for
+the Transfer of Rights under Production Sharing Contracts
+is less than 0.1%, the continuing connected transactions
+under these contracts are exempted from the reporting,
+announcement and independent shareholders' approval
+requirements under Chapter 14A of the Listing Rules.
+The Directors believe that these continuing connected
+transactions were entered into in the normal and ordinary
+course of business for the benefits of the Company, and
+are in the interests of the shareholders as a whole.
+(II) Continuing Connected Transactions with CNPC
+On December 28, 2006, the following continuing
+connected transactions arose as a result of the completion
+of the Company's acquisition of 67% equity interest in
+PKZ, which was announced by the Company on August
+23, 2006:
+2021 ANNUAL REPORT 053
+CONNECTED TRANSACTIONS
+the provision of production services by CNPC to
+the Group;
+the provision of construction and technical services
+by CNPC to the Group;
+⚫the provision of material supply services by CNPC
+to the Group.
+Upon completion of the acquisition of PKZ, PKZ
+became a subsidiary (as defined under the Listing Rules)
+of CNPC E&D. As CNPC is the controlling shareholder of
+the Company and as each of CNPC and the Company
+is interested in 50% interest in CNPC E&D respectively,
+therefore, CNPC and CNPC E&D are connected persons
+of the Company under the Listing Rules. The caps for these
+continuing connected transactions have already been
+included within the caps for the continuing connected
+transactions between the Group and CNPC.
+Gas
+E&D
+198,200
+(ii) all the connected transactions have been in accordance with the pricing policies of the Group if the transactions
+involve the provision of goods or services by the Group in all material respects;
+197,500 197,000
+207,700 205,500 204,500
+35,300 35,300 35,300
+5,800
+5,800
+714
+(vi) Products and services provided by the Group to Beijing Gas
+40,000
+40,000
+40,000
+* According to the provisions of HKEX, the upper limit of the land and property provided by CNPC to the Group for lease from 2021 to
+2023 shall be determined by reference to the annual value of the right-of-use assets. Please refer to the circular, i.e. Update on Ongoing
+Connected Transactions of 2021 to 2023 published on the website of the Hong Kong Stock Exchange on September 15, 2020 for basis
+of determining the upper limit.
+2021 ANNUAL REPORT 055
+CONNECTED TRANSACTIONS
+(B) In relation to the Trademark Licensing Contract, the Patent and Know-how Licensing Contract and the Computer
+Software Licensing Contract, CNPC has granted the Company the right to use certain trademarks, patents, know-how and
+computer software of CNPC at nil consideration.
+Independent Non-Executive Directors' Confirmation
+In relation to the continuing connected transactions undertaken by the Group in 2021, the Independent non-executive
+Directors of the Company confirm that:
+(i) the connected transactions mentioned above have been entered into during the usual course of business of the
+Company;
+(ii) the connected transactions mentioned above have been entered into based on normal commercial terms or better
+terms;
+(iii) the connected transactions mentioned above have been conducted in accordance with the agreements governing
+such transactions and their terms are fair and reasonable and consistent with the interests of shareholders as a whole.
+Auditor's Confirmation
+The auditor of the Company has audited the transactions mentioned above and has provided the Board of Directors
+with a letter indicating that:
+(i) all the connected transactions have been approved by the Board of Directors;
+PetroChina
+(iii) all the connected transactions have been proceeded in accordance with the terms of agreements; and
+1,384
+2,083
+(v) Rental for buildings provided by CNPC to the Group*
+5,685
+(e) Financial Services
+- Aggregate of the daily highest amount of deposits of the Group in CNPC and the
+total amount of interest received in respect of these deposits
+55,000
+55,000
+55,000
+- Insurance fees, handling charges for entrusted loans, and fees and charges for
+settlement services and other intermediary business
+2,400
+2,400
+2,400
+5,800
+- Rents and other payments made under financial leasing
+5,000
+5,000
+(iii) Financial services provided by the Group to the jointly-held entities
+22,000
+22,000
+22,000
+(iv) Land leases provided by CNPC to the Group*
+16,578
+11,019
+5,000
+CONNECTED TRANSACTIONS
+The Group and CNPC continue to carry out certain
+existing continuing connected transactions. In relation to
+existing continuing connected transactions, the Company
+obtained the approval of the Independent Directors and
+the independent shareholders at the seventh meeting
+of the Board of Directors in the year of 2020 held on
+August 26 to 27, 2020 and the third extraordinary general
+meeting of 2020 held on November 5, 2020 for a renewal
+of and amendments to the existing continuing connected
+transactions and the new continuing connected
+transactions, and for the proposed new caps for existing
+continuing connected transactions and new continuing
+connected transactions from January 1, 2021 to December
+31, 2023. Details of the above transactions were set out in
+the Company's announcements in respect of continuing
+connected transactions published on the website of
+the Shanghai Stock Exchange (Announcement No: Lin
+2020-036) and Hong Kong Stock Exchange on August
+27, 2020, respectively, the Company's circular in respect
+of continuing connected transactions published on the
+website of the Hong Kong Stock Exchange on September
+15, 2020, and the Company's announcements in respect
+of passing resolutions at the extraordinary general meeting
+published on the website of the Shanghai Stock Exchange
+(Announcement No: Lin 2020-048) and Hong Kong Stock
+Exchange on November 5, 2020, respectively.
+052
+PetroChina
+2. Injecting Capital into CNPC Finance
+On June 13, 2019, the Company considered and
+adopted the Proposal for Capital Increase to China
+Petroleum Finance Co., Ltd. at the third board meeting in
+2019, approving the capital increase to CNPC Finance
+by the Company, CNPC and CNPC Capital Corporation
+respectively in proportion to their current shareholdings.
+In accordance with the SSE Listing Rules and the Listing
+Rules, each of CNPC, CNPC Capital Corporation and CNPC
+Finance is a connected person of the Company. Therefore,
+this capital increase constitutes connected transaction of the
+Company. For the details of the transaction, please refer to
+the Company's announcements published on the websites
+of the Shanghai Stock Exchange (Announcement No: Lin
+2019-021) and Hong Kong Stock Exchange, respectively,
+on June 13, 2019, and the connected transaction section
+of the 2019 annual report published on the websites of
+the Hong Kong Stock Exchange and the Shanghai Stock
+Exchange on March 26, 2020, and the material connected
+transaction section of the 2020 interim report published
+by the Company on the websites of the Hong Kong Stock
+Exchange and the Shanghai Stock Exchange on August
+27,2020, the connected transaction section of the 2020
+annual report published on the website of the Hong Kong
+Stock Exchange and the Shanghai Stock Exchange on
+March 25, 2021, and the material connected transaction
+section of the 2021 interim report published on the website
+of the Hong Kong Stock Exchange and the Shanghai Stock
+Exchange on August 26, 2021.
+The registered capital of CNPC Finance has
+increased from 8,331.25 million to 16,395.2731 million.
+The registered capital was increased by RMB8,064.0231
+million, which was transferred from capital reserves in
+proportion to the shareholding of all shareholders before
+the implementation of the connected transaction. After
+the completion of the capital increase, the shareholders'
+proportion of shares remains unchanged, with the
+Company, CNPC and CNPC Capital Corporation holding
+32%, 40% and 28% of the equity interests in CNPC
+Finance respectively. This capital increase has completed
+the procedures for alteration of business registration.
+This capital increase is beneficial to enhance
+investment returns of the Company and have a better
+access to the high level and high efficiency funds and
+financial management services of CNPC Finance.
+3. Participation in the Establishment of Industrial
+Capital Investment Company
+On June 24, 2021, the Company, CNPC and CNPC
+Capital entered into a joint venture agreement to establish
+the Kunlun Capital, with contribution of RMB2.9 billion,
+RMB5.1 billion and RMB2.0 billion, respectively. CNPC is
+the controlling shareholder of the Company, CNPC Capital
+is a company controlled by CNPC. According to the SSE
+Listing Rules and the Listing Rules, both CNPC and CNPC
+Capital are connected persons of the Company. As such,
+this transaction constitutes a connected transaction. For
+details, please refer to the announcements published
+by the Company on the website of the Shanghai Stock
+Exchange (Announcement No. Lin 2021-012, Lin 2021-
+017) and the announcement published on the website of
+the Hong Kong Stock Exchange on April 29, 2021 and
+June 24, 2021, respectively, and the 2021 interim report
+published on the website of Hong Kong Stock Exchange
+and the Shanghai Stock Exchange on August 26, 2021,
+and "Other Significant Matters" of the Significant Matters
+section of this annual report.
+Kunlun Capital primarily engages in the investment
+of strategic emerging industries. Participation in the
+establishment of Kunlun Capital is beneficial to (i) the
+implementation of the Company's innovative strategy
+and green low-carbon strategy by investing in strategic
+emerging industries to build a multi-functional business
+structure; (ii) discovering the strategic investment
+opportunities through financial investments, playing the
+role of industrial capital in incubation and development,
+and promoting the elevation of capital and financial
+business, to foster the formation of new technologies and
+new business scenarios; and (iii) revitalizing the capital
+stock, realizing the rational flow of capital and maintaining
+and increasing the value.
+2021 ANNUAL REPORT 049
+PETROCHINA COMPANY LIMITED
+Continuing Connected Transactions
+(1) Continuing Connected Transactions with CNPC
+In 2021, the Group and CNPC carried out the
+continuing connected transactions referred to in the
+following agreements:
+to the Group, of a range of products and services. The
+Comprehensive Agreement entered into force on January
+1, 2021 with an effective term of three years.
+During the term of the Comprehensive Agreement,
+individual product and service implementation
+agreements described below may be terminated from
+time to time by the parties thereto by providing at least
+6 months' written notice of termination in relation to any
+one or more categories of products or services. Further,
+in respect of any products or services contracted to be
+provided on or before the notice of termination, the notice
+of termination will not affect the completion of the provision
+of such products and services.
+CONNECTED TRANSACTIONS
+048 PETROCHINA COMPANY LIMITED
+On December 22, 2020, the ninth meeting of the
+Company's Board of Directors in 2020 reviewed and
+approved the "Proposal on Kunlun Energy Pipeline Asset
+Transaction", approving the sale of the 60% equity interest
+in Beijing Pipeline and the 75% equity interest in Dalian
+LNG held by Kunlun Energy, a subsidiary of the Company,
+to PipeChina. In view of the fact that the two directors
+despatched by the Company to PipeChina are the current
+director and senior management of the Company and one
+of them is the senior management of CNPC (the controlling
+shareholder of the Company), according to the SSE
+Listing Rules, PipeChina is a related legal person of the
+Company. Therefore, this transaction constitutes a related
+party transaction of the Company under the SSE Listing
+Rules. For details of the transaction, please refer to the
+relevant announcements published on the websites of the
+Shanghai Stock Exchange (Announcement No.: Lin 2020-
+051) and Hong Kong Stock Exchange by the Company,
+respectively, on December 22, 2020. Kunlun Energy and
+PipeChina completed equity transfer on March 31, 2021.
+For details, please refer to the announcements published
+by the Company on the website of the Shanghai Stock
+Exchange (Announcement No.: Lin 2021-008) and the
+announcement published on the website of the Hong
+Kong Stock Exchange on April 1, 2021.
+1. Assets Transaction of Kunlun Energy
+(iv) these transactions have been entered into within the cap mentioned above, if applicable.
+056 PETROCHINA COMPANY LIMITED
+SIGNIFICANT EVENTS
+PetroChina
+This event does not affect the continuity of the
+business and the stability of the management of the Group.
+(6) China Continued to Deepen Oil and Gas Price
+Mechanism Reform
+On May 18, 2021, NDRC issued the "Notice on
+the Action Plan for Deepening the Reform of the Price
+Mechanism during the 14th Five-Year Plan Period" (NDRC
+Price [2021] No.689)(《關於“十四五”時期深化價格機制
+改革行動方案的通知》(發改價格〔2021] 689號)), which
+stipulated that price mechanism reform for oil and natural
+gas should be steadily promoted during the 14th Five-
+Year Plan period. In accordance with the reform direction
+of "controlling the middle and liberalizing the two ends",
+and based on independent operation of infrastructures
+including natural gas pipeline, diversification process
+of exploration and development, gas supply and sales
+(A) Products and Services to be provided by the
+Group to CNPC/jointly-held entities
+entities, the market-oriented reform of city gate prices of
+natural gas shall be steadily promoted, and the linkage
+mechanism between end sales prices and procurement
+costs shall be improved; active coordination shall be
+carried out to promote the fairness and openness in
+urban gas distribution networks, reduce gas distribution
+levels, strictly monitor gas distribution prices, explore
+marketization of end-user sales prices, and research and
+improve the pricing mechanism of refined products in line
+with domestic and foreign energy market changes and the
+progress of domestic institutional reform.
+2021 ANNUAL REPORT
+047
+CONNECTED TRANSACTIONS
+CONNECTED TRANSACTIONS
+CNPC is the controlling shareholder of the Company
+and therefore transactions between the Group and CNPC
+constitute connected transactions of the Group under the
+SSE Listing Rules and the Listing Rules. China National
+Oil and Gas Exploration and Development Corporation
+("CNODC"), a wholly-owned subsidiary of CNPC, holds
+50% interest in CNPC E&D, a non-wholly-owned subsidiary
+of the Group. Pursuant to the Listing Rules, CNPC E&D
+is a connected person of the Company and transactions
+between the Group and CNPC E&D constitute connected
+transactions of the Group. Since December 28, 2006, the
+Group has held 67% equity interest in PetroKazakhstan
+Inc. ("PKZ") through CNPC E&D. Pursuant to the Listing
+Rules, CNPC E&D and its subsidiaries are connected
+persons of the Group. Therefore, transactions between
+the Group and PKZ constitute connected transactions of
+the Group.
+The following connected transactions constitute
+the connected transactions or continuing connected
+transactions as defined under the SSE Listing Rules
+and/or the Chapter 14A of the Listing Rules and satisfy
+relevant disclosure requirements thereof. For details of
+the following connected transactions, please refer to the
+relevant announcements published on the websites of
+the Shanghai Stock Exchange or the Hong Kong Stock
+Exchange and the Company. Note 61 set out thereto in
+the financial statements of the Company prepared in
+accordance with the Accounting Standards for Enterprises
+of the PRC has properly disclosed connected transactions
+or continuing connected transactions pursuant to the
+Listing Rules.
+One-off Connected Transaction
+This event did not affect the continuity of the business
+and the stability of management of the Group, and was
+conducive to the sustainable and healthy development
+of the Group and achieving sustainable and positive
+operating results in the long term.
+Under the Comprehensive Agreement, products
+and services to be provided by the Group to CNPC/
+jointly-held entities include: refined oil products, chemical
+products, natural gas, crude oil, supply of water, supply
+of electricity, supply of gas, supply of heating, quantifying
+and measuring, entrusted operation, material supply and
+other products and services as may be requested by
+CNPC/jointly-held entities for its own consumption, use or
+sale from time to time. In addition, the Group shall provide
+the jointly-held entities with financial services including
+entrustment loans, guarantees and other financial
+services.
+CONNECTED TRANSACTIONS
+1. Comprehensive Products and Services Agreement
+the pricing of other financial services shall
+be determined based on the prices prescribed by
+government authorities including, among others, People's
+Bank of China, China Banking and Insurance Regulatory
+Commission, and the fee charging standards published
+by the aforementioned relevant regulatory authorities and
+with reference to the market-oriented price.
+(ii) for the financial services provided by CNPC/
+jointly-held entities:
+⚫the loans and deposit services shall be provided
+at prices determined in accordance with the relevant
+interest rate and standard for fees as promulgated by
+the People's Bank of China. Such prices must also be no
+less favourable to the Group than those offered by other
+independent third parties;
+2021 ANNUAL REPORT 051
+CONNECTED TRANSACTIONS
+(B) Products and Services to be provided by CNPC/
+jointly-held entities to the Group
+the pricing of other financial services shall
+be determined based on the prices prescribed by
+government authorities including, among others, People's
+Bank of China, China Banking and Insurance Regulatory
+Commission, and the fee charging standards published
+by the aforementioned relevant regulatory authorities and
+with reference to the market-oriented price.
+(a) government-prescribed prices; or
+2. Product and Service Implementation Agreements
+Each product and service implementation agreement
+will set out the specific products and services requested
+by the relevant party and any detailed technical and other
+specifications which may be relevant to those products
+or services. The product and service implementation
+agreements may only contain provisions which are in all
+material respects consistent with the binding principles
+and guidelines and terms and conditions in accordance
+with which such products and services are required to be
+provided as contained in the Comprehensive Agreement.
+As
+the product and service implementation
+agreements are merely further elaborations on the
+provision of products and services as contemplated by
+the Comprehensive Agreement, they do not as such
+constitute new categories of connected transactions.
+3. Land Use Rights Leasing Contract and Supplemental
+Agreement
+The Company and CNPC signed the Land Use
+Rights Leasing Contract on March 10, 2000 under which
+CNPC has leased land in connection with various aspects
+of the operations and business of the Company covering
+an aggregate area of approximately 1,145 million square
+metres, located throughout the PRC, to the Company for
+a term of 50 years at an annual fee of RMB2 billion. The
+total rent payable for the lease of all such property may,
+as at the expiration of 10-year term of the Land Use Rights
+Leasing Contract, be adjusted by agreement between the
+Company and CNPC to reflect market conditions prevalent
+at such time of adjustment, including the then prevailing
+marketing prices, inflation or deflation (as applicable) and
+such other factors considered as relevant by both parties
+in negotiating and agreeing to any such adjustment.
+Taking into account the actual business needs
+of the Company and the changes in the land market in
+recent years, the Company entered into a supplementary
+agreement to the Land Use Rights Leasing Contract with
+CNPC on August 25, 2011, in which the area of the leased
+land was reconfirmed as 1,783 million square meters and
+the annual rent was adjusted to no more than RMB3,892
+million (excluding taxes and fees). Meanwhile, the parties
+agreed to adjust the area of building leased and the rental
+fees every three years as appropriate by reference to the
+status of the production and operations of the Company.
+The supplementary agreement took effect as from January
+1, 2012.
+On August 27, 2020, the parties re-confirmed in a
+letter of confirmation as agreed that the area of the leased
+land was 1,142 million square meters and the annual
+rental was adjusted to approximately RMB5,673 million
+(excluding taxes and fees). The letter of confirmation took
+effect as from January 1, 2021.
+According to the current arrangements, from time
+to time and as required, individual product and service
+implementation agreements may be entered into between
+the relevant subordinate companies and entities of CNPC/
+jointly-held entities or the Group providing the relevant
+products or services, as appropriate, and the relevant
+subordinate companies and entities of the Group or
+CNPC/jointly-held entities, requiring such products or
+services, as appropriate.
+The Comprehensive Agreement details specific
+pricing principles for the products and services to be
+provided pursuant to the Comprehensive Agreement. If,
+for any reason, the specific pricing principle for a particular
+product or service ceases to be applicable, whether due
+to a change in circumstances or otherwise, such product
+or service must then be provided in accordance with
+the following general pricing principles as defined in the
+Comprehensive Agreement:
+⚫ the guarantees shall be provided at prices not
+higher than the fees charged by the state policy banks in
+relation to the provision of guarantees. References must
+also be made to the relevant government-prescribed
+price and market-oriented price; and
+⚫ the guarantees shall be provided with reference to
+the market-oriented price; and
+The Group and CNPC implemented the
+Comprehensive Products and Services Agreement (the
+"Comprehensive Agreement") entered into on August
+27, 2020 for the provision (A) by the Group to CNPC/
+jointly-held entities and (B) by CNPC/jointly-held entities
+Financial services, including loans and other
+financial assistance, deposits services, entrusted loans,
+settlement services, financial leasing services and other
+financial services.
+More products and services are expected to be
+provided by CNPC/jointly-held entities to the Group, both
+in terms of quantity and variety, than those provided by
+the Group to CNPC/jointly-held entities. They have been
+grouped together and categorised according to the
+following types of products and services:
+050 PETROCHINA COMPANY LIMITED
+CONNECTED TRANSACTIONS
+PetroChina
+Engineering technology services, including but
+not limited to exploration technology service, downhole
+operation service, oilfield construction service, refinery
+construction service and engineering design service;
+(b) where there is no government-prescribed price,
+then according to the relevant market prices; or
+Save as disclosed above, none of other related-party transactions set out in the note 61 of the consolidated financial
+statements prepared by the Company in accordance with China Accounting Standards for Business Enterprises constitutes
+connected transactions or continuing connected transactions that are required to be disclosed under the Listing Rules. The
+Company confirms that it has complied with the requirements of Chapter 14A of the Listing Rules in relation to all connected
+transactions and continuing connected transactions to which the Company was a party during 2021.
+• Material supply services, mainly involving the
+agency services on the procurement of materials,
+including but not limited to purchase of materials,
+quality examination, storage of materials and delivery of
+materials, which by virtue of its nature, are not covered
+in the engineering technology services and production
+services referred to above;
+Social and living services, including but not limited
+to security system services, staff canteens and training
+centres etc.; and
+(c) where neither (a) nor (b) is applicable, then
+according to:
+(i) the actual cost incurred; or
+(ii) the agreed contractual price.
+In particular, the Comprehensive Agreement stipulates,
+among other things, that:
+(i) for the financial services provided by the Group:
+⚫the pricing of entrusted loans shall be determined
+based on the relevant interest rate and standard for fees
+as promulgated by the People's Bank of China and with
+reference to market-oriented price;
+Production services, mainly associated with
+products and services to be provided, arising from the
+day-to-day operations of the Group, including but not
+limited to crude oil, natural gas, refined oil products,
+chemical products, water supply, electricity supply, gas
+supply and communications;
+Connected parties
+by connected party
+Funds provided to the Group
+party
+Funds provided to connected
+Unit: RMB million
+93,108
+424,409
+18
+4
+14
+%
+Percentage of the
+total amount of the
+type of transaction
+Transaction amount
+RMB million
+331,301
+Connected obligatory rights and debts
+Purchase of goods and services from
+connected party
+Transaction amount
+%
+Opening
+balance
+CONNECTED TRANSACTIONS
+PetroChina
+The information set out in the tables below is principally extracted from the financial
+statements of the Group prepared in accordance with CAS:
+Connected sales and purchases
+Connected parties
+325
+CNPC and its subsidiaries
+Other connected parties
+Sales of goods and provision of services
+to connected party
+RMB million
+69,058
+54,842
+123,900
+Percentage of the
+total amount of the
+type of transaction
+Total
+Closing
+Occurrence
+Reading
+relevant
+materials
+V
+V
+V
+Research
+Accounting/finance/business
+management and productions
+and operations of the Company
+governance/legislations, rules
+and regulations
+Updates on corporate
+seminars
+materials
+Hou Qijun
+Chairman
+Dai Houliang
+Names
+training and
+relevant
+Attending
+Reading
+PetroChina
+CORPORATE GOVERNANCE
+064 PETROCHINA COMPANY LIMITED
+Positions
+Vice Chairman
+V
+√
+√
+V
+Executive Director and President
+Huang Yongzhang
+V
+✓
+√
+v
+Non-executive Director
+Jiao Fangzheng
+√
+√
+√
+V
+√
+√
+v
+Non-executive Director
+Liu Yuezhen
+Duan Liangwei
+V
+Details of trainings attended by the current Directors
+and the Secretary to the Board are set out as below:
+The Directors and the Secretary to the Board continued
+participating in professional development programmes to
+develop and update their knowledge and skills, with view
+to contributing to the Board with sufficient information and
+up to its requests. In 2021, affected by restrictions due to
+the COVID-19, the independent Directors of the Company
+were not able to attend the training and research on-site
+for most of them were abroad. They actively learned the
+operating status, financial performance and the situation of
+major projects of the Company through video conference,
+high-level exchanges and correspondence, and
+overcame difficulties of epidemic and time differences,
+etc. to actively give advice and suggestions concerning
+the operation of the Board and the development of the
+business, through which to fulfil their fiduciary duties.
+(7) Training Attended by Directors and Secretary to
+the Board
+Pursuant to the Articles of Association, the Directors
+(including non-executive Directors) shall be elected at
+the shareholders' general meeting and serve a term of
+three years. Upon the expiry of their terms of office, the
+Directors may be re-elected for another term.
+the completion of the performance targets of 2021 by
+the President's team with reference to the achievement
+of the performance targets in 2021 and the business
+development plan of 2022, and formulated the performance
+contract for the President's team for 2022. The "Report on
+Evaluation of the President's Operating Results for 2021
+and the Formulation of President's Performance Contracts
+for 2022" was reviewed and approved at the fourteenth
+meeting of the eighth Board.
+CORPORATE GOVERNANCE
+2021 ANNUAL REPORT 061
+During the reporting period, in accordance with
+the "Measures of Evaluation of Annual Performance of
+the President's Work Team", the Company evaluated
+5. Senior Management Evaluation and
+Incentive Scheme
+The Company is independent from its controlling
+shareholder, CNPC, generally, in respect of business,
+personnel, asset and finance. The Company has
+independent and comprehensive business operations
+and management capabilities in market.
+4. Independence of the Company from the
+Controlling Shareholder
+Meanwhile, all independent Directors continued to
+pay attention to the relevant information feedback from the
+regulatory authorities, investors, the media and the public,
+and had the management fully note and understand
+the demands of stakeholders. They especially paid
+close attention to matters such as the cap of continuing
+connected transactions and the investment budget plan
+for the upcoming year, and the demands of capital market
+investors.
+All independent Directors carefully read the
+Company's internal governance system, performance
+reminder letter, annual work plan, the "Company Status
+Bulletin" and other work materials to understand the
+Company's latest work developments, and performed their
+duties strictly in accordance with regulatory requirements.
+Through relevant meetings of the Board of Directors,
+they reviewed management reports at regular intervals
+to understand the overall situation of the Company's
+operation and management.
+out their work legally and compliantly. All independent
+Directors have been qualified for serving as independent
+Directors.
+During the annual debriefing period, all independent
+Directors actively learnt about, and got familiar with,
+the latest policies and regulations concerning listed
+companies and the Company's business. They observed
+these policy requirements in their work and carried
+For proposals that need to be submitted to the Board
+of Directors for review, all independent Directors carefully
+read the relevant documents and materials in advance,
+took the initiative to obtain the relevant information, got a
+detailed understanding of the background of proposals to
+be fully prepared for discussion and decision-making at
+meetings of the Board of Directors and special committees,
+and put forward relevant independent opinions and review
+opinions. They actively attended meetings, carefully
+reviewed proposals in meetings, actively participated in
+discussion, strove to give full play to their professional
+advantages, and provided professional opinions and
+recommendations through in-depth communication with
+the management. They supervised the implementation
+after meetings and learnt about the progress to ensure
+effective implementation.
+(2) Work Seminars, communications about investigations
+and research
+As the Company's independent directors are from
+060 PETROCHINA COMPANY LIMITED
+CORPORATE GOVERNANCE
+PetroChina
+Hong Kong, Japan and the United Kingdom, while they
+were not able to conduct field research in 2021 due to
+the continued impact brought by the COVID-19, they
+managed to overcome various difficulties such as the
+epidemic and time difference to actively understand the
+Company's operating status, financial performance and
+progress of major projects through video conferences,
+high-level exchanges, and correspondence. They actively
+made recommendations for the operation of the Board
+of Directors and the Company's business development,
+faithfully fulfilling their duty of diligence.
+The independent directors of the Company
+remained concern about matters such as "carbon
+peak" and "carbon neutrality", working capital of first
+quarter of the year, the establishment of Kunlun Capital
+and the development of new energy, new materials and
+new business. Such independent directors also raised
+questions about, and gave opinion and recommendations
+on, the Company's business development, financial
+performance and establishment of the industrial capital
+investment company. Mr. Dai Houliang, the Chairman,
+attached great importance and required the relevant
+business departments to study and prepare special
+reports, and address the concerns of the independent
+directors in writing. Mr. Huang Yongzhang, the Director
+and President of the Company, in conjunction with
+departments in charge of planning and finance and other
+integrated departments, convened special exchange
+meetings with independent directors to discuss matters
+such as the development of new energy business and the
+2022 investment plan. Through in-depth discussions and
+exchanges, understanding and consensus were reached,
+and the meetings were fruitful.
+(3) Day-to-day work
+Opening
+During the reporting period, the Company conducted,
+on the basis of the "Pilot Measures of Evaluation of
+Performance of the Senior Management of PetroChina
+Company Limited" and the "Pilot Measures of Evaluation
+of Economy Value Added of Senior Management",
+appraisals on members of the senior management
+from specialised companies, local companies and
+the science and research planning departments with
+respect to their achievement of the performance targets
+for 2021. Rewards and punishments were made on the
+basis of the performance evaluation. With reference
+to the business development plan and key tasks of the
+Company for 2022 as well as the positions and duties
+of the various management officers, the Company
+formulated performance contracts for 2022 and signed
+with the management officers under middle and above
+level, respectively. The Company continued to conduct
+follow-up evaluation of quarterly performance targets and
+advanced quarterly performance compensation to senior
+management accordingly.
+√
+6. Corporate Governance Report
+For the year ended December 31, 2021, the Company
+has complied with all the code provisions of the Corporate
+Governance Code ("Corporate Governance Code") set
+out in Appendix 14 to the Listing Rules.
+(6) Term of Office of Directors
+Pursuant to the Articles of Association, the primary
+duties and responsibilities of the Chairman are chairing
+the shareholders' general meetings and convening
+and chairing the Board meetings, inspecting the
+implementation of Board resolutions, signing certificates
+of securities issued by the Company, and other duties
+and power authorised by the Articles of Association and
+the Board. Pursuant to the Articles of Association, the
+primary duties and responsibilities of the Vice Chairman
+are when the Chairman is unable to exercise his powers,
+such powers shall be exercised by the Vice Chairman
+who has been designated by the Chairman to exercise
+on his behalf. The primary duties and responsibilities of
+the President are managing production and operation of
+the Company, organising the implementation of Board
+resolutions, organising the implementation of annual
+business plans and investment plans of the Company,
+formulating plans for the establishment of internal
+management institutions of the Company, devising the
+basic management system of the Company, formulating
+specific rules and regulations of the Company, advising
+the Board to appoint or dismiss Senior Vice Presidents,
+Vice Presidents, the Chief Financial Officer and other
+senior management personnel, appointing or dismissing
+management staff other than those who should be
+appointed or dismissed by the Board, and performing
+other duties and power authorised by the Articles of
+Association and the Board.
+(5) The Chairman, Vice Chairman and President
+CORPORATE GOVERNANCE
+2021 ANNUAL REPORT 063
+During this year, the Board has performed the
+corporate governance obligations set out below as
+provided in the Listing Rules: (a) to develop and review
+the Company's policies and practices on corporate
+governance and make recommendations; (b) to review
+and monitor the training and continuous professional
+development of directors and senior management; (c) to
+review and monitor the Company's policies and practices
+on compliance with legal and regulatory requirements;
+(d) to review the Company's compliance with Corporate
+Governance Code and disclosure in this annual report.
+The Board has established five committees: the
+Nomination Committee, the Audit Committee, the
+Investment and Development Committee, the Examination
+and Remuneration Committee and the Sustainable
+Development Committee. The main responsibility of these
+committees is to provide support to the Board in decision-
+making. The Directors participating in these special
+board committees focus on particular issues according
+to their division of labour and make recommendations
+on the improvement of the corporate governance of the
+Company.
+non-executive Directors are completely independent of the
+Company, its substantial shareholders and its connected
+persons and fully comply with the requirements concerning
+independent non-executive Directors under the Listing
+Rules. Mr. Cai Jinyong, the independent non-executive
+Director, has appropriate accounting and financial
+experience as required under Rule 3.10 of the Listing
+Rules. Please see the section headed the Brief Biography
+of the Directors under the "Directors, Supervisors, Senior
+Management and Employees" section of this annual
+report for biographical details of Mr. Cai Jinyong. The
+five independent non-executive Directors do not hold
+other positions in the Company. They perform their duties
+seriously according to the Articles of Association and
+the relevant requirements under the applicable laws and
+regulations.
+The Company has received a confirmation of
+independence from each of the five independent non-
+executive Directors pursuant to Rule 3.13 of the Listing
+Rules. The Company considers that the five independent
+The Company's Board is elected by the shareholders'
+general meeting of the Company through voting and is
+held accountable to the shareholders' general meeting.
+The primary responsibilities of the Board are to provide
+strategic guidance to the Company, exercise effective
+supervision over the management, ensure that the
+Company's interests are protected and are accountable to
+the shareholders. The powers and duties of the Board and
+the management have been clearly specified in the Articles
+of Association, with the aim to provide adequate check
+and balance mechanism for good corporate governance
+and internal control. In accordance with the Articles of
+Association or as authorised by the shareholders' general
+meeting, the Board makes decisions on certain important
+matters, including annual plans for principal operations
+development and investment; annual criteria for
+assessment of the performance of members of operation
+teams of the Company and annual remuneration plans;
+distribution plans in respect of interim profit; and corporate
+reorganisation of the Company. The remuneration of the
+Directors of the Company is determined by the Board as
+approved and authorised by the shareholders' general
+meetings, with a calculation based on responsibilities
+and performances of Directors and performance of the
+Group. The Directors and the Board carry out corporate
+governance duties in a serious and responsible manner.
+The Directors attend the Board meetings in a serious and
+responsible manner, perform their duties as Directors
+earnestly and diligently, make important decisions
+concerning the Company, appoint, dismiss and supervise
+the members of the operation teams of the Company. Led
+by the President, the management of the Company is
+responsible for implementing the resolutions approved by
+the Board and administering the Company's day-to-day
+operation and management.
+(4) Operations of the Board of Directors
+PetroChina
+CORPORATE GOVERNANCE
+PETROCHINA COMPANY LIMITED
+062
+There is no relationship (including financial, business,
+family or other material or relevant relationship(s)) among
+members of the Board and between the Chairman and the
+President of the Company.
+Pursuant to the Articles of Association and Rules of
+Procedure for the Board of Directors, the Board convened
+6 Board meetings, including 3 on-site and video regular
+meetings and 3 extraordinary meetings by written circular
+and passed 31 resolutions of the Board meetings in 2021.
+For details of the attendance rate of Directors at on-site
+regular meetings of the Board during the year, please refer
+to the section "Members of the Board and the attendance
+rate of Directors" in the "Directors' Report" of this annual
+report.
+In accordance with the provisions of the Listing Rules
+relating to the composition of the Board of Directors, at
+least one thirds of the members of the Board of Directors
+shall be independent non-executive Directors, and at
+least one of whom must possess appropriate professional
+qualifications or expertise in accounting or financial
+management. Please refer to the "Directors, Supervisors,
+Senior Management and Employees" section of this annual
+report for the basic information of the current Directors of
+the Company and changes during the reporting period.
+(3) Board of Directors
+The Company has adopted the provisions in relation
+to dealing in shares of the Company by Directors as set out
+in the Model Code for Securities Transactions by Directors
+of Listed Issuers contained in Appendix 10 to the Listing
+Rules (the "Model Code"). After specific enquiries being
+made to all the Directors and Supervisors, each Director
+and Supervisor has confirmed to the Company that each
+of them has complied with relevant standards set out in
+the Model Code in the reporting period.
+(2) Compliance with the Model Code for Securities
+Transactions by Directors of Listed Issuers
+(1) Compliance with the Corporate Governance
+Code
+Ren Lixin
+Non-executive Director
+V
+1. Improvement of Corporate Governance
+During the reporting period, the Company operated
+its business in a compliant manner strictly in accordance
+with domestic and overseas regulatory requirements.
+Pursuant to the Articles of Association, relevant laws
+and regulations and the securities regulatory rules of the
+jurisdictions in which the Company is listed, and in light
+of the actual conditions of the Company, the Company
+continuously formulated, improved and effectively
+implemented the various rules of procedure, and the
+relevant work processes for the Board of Directors and its
+respective committees.
+During the reporting period, the actual governance
+of the Company complied with the requirements of
+regulatory documents on the corporate governance of
+listed companies issued by the regulatory authorities and
+stock exchanges of places where the Company is listed.
+Through the coordinated operation and effective check
+and balance of the general meeting of shareholders,
+the Board of Directors and its special committees, the
+Supervisory Committee and the management led by
+the President, besides the implementation of effective
+internal control and management systems, the Company
+further standardized its internal management operations
+and continuously improved its management level. In
+accordance with the relevant provisions of the Articles
+of Association, the Vice Chairman of the Board and the
+directors of the Company were elected, the members
+of the special committees of the Board were adjusted
+accordingly, and the President, Senior Vice President,
+Vice President and Chief Engineer were appointed.
+With the increasing emphasis on promoting the green
+and low-carbon development, the Company renamed
+the Health, Safety and Environment Committee to the
+Sustainable Development Committee and enhanced ESG
+management and control functions at the Board level,
+which further improved the construction of the Board.
+Resolutions in respect of the financial reports, dividend
+distribution proposal, investment plans, financial budget
+reports, change in the name of the relevant committee
+and its functions, adjustments to the remuneration of the
+independent directors were reviewed and approved.
+Additionally, strictly in compliance with the regulatory
+requirements, the Company completed the review process
+on the change of the accounting firm, and reviewed the
+reports on the "14th Five-Year Plan" development plan,
+the performance of duties by the acquisition management
+group, an authorized group under the board of directors,
+and other material matters.
+The Company always attaches importance to
+information disclosure, and strictly complies with various
+regulatory rules of the places of listing. The Company
+established an
+information disclosure management
+system to disclose information in a timely and compliant
+manner, and designated specific departments
+responsible for handling matters relating to the disclosure
+of inside information. Employees are prohibited from
+dealing or procuring others to deal the Company's
+shares using inside information. During the reporting
+period, the Company truly, accurately and completely
+disclosed various information in a timely manner, which
+ensured that all shareholders had equal opportunities to
+access to information relating to the Company, and that
+the transparency in the corporate governance of the
+Company could be enhanced continuously.
+058 PETROCHINA COMPANY LIMITED
+CORPORATE GOVERNANCE
+PetroChina
+2. Improvement of Internal Control System
+Executive Director and Senior
+Vice President
+During 2021, the Company continued to strengthen
+its foundations for the development of an internal control
+system by insisting on redressing its shortcomings,
+consolidating its fundamentals and revitalizing its
+capabilities. The Company also intensified its efforts in
+connection with the management and control, and also
+the provision of early warning, of major risks, streamlined
+and optimized the workflow at the head office, set up an
+authority manuals mechanism, and explored the channels
+to improve the information technology application level
+for internal control and supervision. As the Company
+continued to achieve effective internal controls, its ability
+to prevent and mitigate major risks was therefore further
+enhanced. First, by adhering to the principle of inherited
+innovation, the Company strived to perfect the top-level
+design of the internal control system in order to ensure
+that the design of such system is in compliance with the
+relevant requirements. Second, the Company undertook
+on a continuous assessments of major risks and prepared
+the relevant reports, enhanced its efforts in monitoring,
+and giving early warning of major risks, and strengthened
+its analysis and management of risk events, all of which in
+turn constantly improved its risk management and control
+capability. Third, by streamlining its business frameworks
+and optimizing its workflow structures, the Company was
+able to perfect its general process catalogue and to focus
+on studying and determining the types of risks and the
+corresponding management and control measures, which
+in turn allowed the Company to effectively commence
+business workflow and also to streamline and optimize the
+relevant works. Fourth, the Company further improved the
+efficiency in the use of the limits of authority manuals by
+integrating various categories of major limits of authority
+and consolidating key approval matters in accordance
+with the principles of clear authority, compliance with laws
+and regulations, highlighting key issues, and streamlining
+and efficiency. Fifth, by taking the full advantage of
+shared service centres and other information technology
+development achievements and exploring the application
+of information technology in areas of internal controls and
+supervision, the Company could improve its efficiency in
+the administration and control of its information system
+authority. Sixth, by reasonably determining the scope
+of tests, emphasizing key areas of test, scientifically
+optimizing testing methods, proactively cooperating with
+external audits, and identifying exceptional matters for
+rectification purposes, the Company was able to further
+intensify its internal controls and supervision and in turn to
+ensure the effective implementation of its internal control
+system. To date, all exceptional issues detected in such
+tests were rectified and no major defect was found upon
+assessment.
+The Company regularized in a timely manner and
+strictly implemented financial management processes
+based on the adjustments to the organisational structure
+to ensure that financial reports be true, accurate and valid.
+The Company also strengthened the implementation
+of the information disclosure management system,
+the identification standards and reporting procedures
+for major events, and the collection, compilation and
+disclosure procedures for disclosable matters.
+The Legal and Corporate Reform Department
+of the Company is responsible for organising and
+coordinating the internal control tests both internally and
+externally, supervising the rectification, and organising
+operational evaluation of the internal control system.
+Members of the Audit Committee carefully reviewed
+the internal control report in accordance with the work
+arrangements during the year at meetings held on March
+23, August 25 and December 27, 2021 respectively. The
+committee considered that the internal control system
+was effectively developed and operated, and in general
+2021 ANNUAL REPORT 059
+CORPORATE GOVERNANCE
+played an important role. The committee recommended
+that the internal control administration department should
+strengthen their communication with other supervisory
+departments so as to conduct in-depth analysis of typical
+cases with a view to further improving the development
+of the internal control system and also to prevent and
+mitigate any other major risks.
+The Board is responsible for establishing and
+maintaining sufficient internal control systems. Upon
+evaluation of the internal control and risk management
+systems of the Company based on regulatory
+requirements, the Board was of the view that such
+systems were effective for the year ending December
+31, 2021. Such internal control system aims to manage
+rather than eliminate the risk of failure to achieve business
+objectives, and can only provide reasonable rather than
+absolute warranty that there will not be any material
+misrepresentation or loss. The Company will disclose
+its internal report and internal audit report separately.
+The Company had engaged PricewaterhouseCoopers
+Zhong Tian LLP (Special General Partnership) audited the
+effectiveness of the internal control system in relation to
+financial reporting of the Company and issued a standard
+and unqualified audit opinion.
+3. Performance of Independent Directors'
+Duties
+During the reporting period, the Independent Directors
+of the Company earnestly and diligently performed
+their duties in accordance with the relevant domestic
+and overseas laws and regulations and the Articles of
+Association. During the reporting period, they reviewed
+the proposals and relevant documents submitted by the
+Company and actively participated in the general meetings
+and meetings of the Board and its special committees
+(please refer to the Directors' Report section of this report
+for attendance). They expressed their views objectively and
+independently and protected the lawful interests of all the
+shareholders of the Company, in particular, those of the non-
+controlling interest shareholders. Independent Directors
+reviewed regular reports of the Company diligently. They
+had discussions with external auditors for annual audit
+before and after their year-end auditing. Such meetings
+were held prior to meetings of the Board. They monitored
+and procured that the Company made disclosures in
+compliance with the relevant laws, regulations as well
+as rules of the Company on information disclosure, thus
+ensuring the truthfulness, accuracy and completeness of
+the Company's information disclosure. During the reporting
+period, the independent Directors of the Company did
+not raise any objection to any resolutions or other matters
+discussed at the meetings of the Board of the Company.
+Meanwhile, the Independent Directors of the Company
+kept themselves informed of relevant laws, regulations
+and regulatory rules by referring to the Update Report on
+topical issues prepared by the Company to understand the
+progress of major projects of the Company.
+CORPORATE GOVERNANCE
+(1) Attendance of meetings
+CORPORATE GOVERNANCE
+2021 ANNUAL REPORT
+Occurrence
+amount
+balance
+balance
+amount
+Closing
+balance
+CNPC and its subsidiaries
+96,298
+37,502
+133,800
+Other connected parties
+17,527
+3,565
+21,092
+Total
+17,527
+3,565
+21,092
+96,298
+37,502
+133,800
+057
+066 PETROCHINA COMPANY LIMITED
+The Company attached great importance to internal
+control and risk management. By following the regulatory
+requirements of its places of listing, the Company
+established and effectively operated its internal control
+system.
+On October 27, 2021, the Nomination Committee met
+by way of written circular to review and adopt the Proposal
+for Electing the Vice Chairman of the Company and the
+Proposal for Adjusting the Composition of the Board
+Committees of the Company, and passed resolutions
+thereon.
+Jiang, Simon X.
+Cai Jinyong
+<
+<
+>
+>
+>
+>
+>
+>
+V
+All members of the Nomination Committee attended
+all the meetings of the committee.
+Simon Henry
+Director
+Tokuchi Tatsuhito
+Independent non-executive
+Director
+Elsie Leung Oi-sie
+Independent non-executive
+√
+√
+Chai Shouping
+Independent non-executive
+Director
+Independent non-executive
+Director
+V
+V
+At present, the Company's male Directors accounted
+for 91.7% and female Directors accounted for 8.3%. The
+nationalities of the Company's Directors include PRC
+(including Hong Kong), Japan and the United Kingdom.
+Directors aged between 51 and 60 years old accounted
+for 58.3%, aged between 61 and 70 years old accounted
+for 33.3%, aged above 71 years old accounted for 8.3%.
+58.3% of the Directors of the Company have a professional
+On August 24, 2021, the Nomination Committee
+met by way of written circular to consider and adopt the
+Proposal for the Election of Directors of the Company
+and the Proposal for the Appointment of the Senior Vice
+President of the Company, and passed the relevant
+resolutions thereon;
+On July 19, 2021, the Nomination Committee met
+by way of written circular to review and adopt the Report
+on the Appointment of the Senior Management of the
+Company, and passed the resolution thereon;
+On April 28, 2021, the Nomination Committee met by
+way of written circular to review the Appointment of the
+Chief Engineer of the Company, and passed the resolution
+thereon;
+On March 23, 2021, the Nomination Committee
+met by way of written circular to review the Appraisal of
+Performance of the Board of Directors of the Company in
+2020 and the Proposal for the Appointment of the President
+of the Company and passed the resolutions thereon;
+background in petrochemical industry, 16.7% of Directors
+have economic background, 16.7% of Directors have
+financial professional background, and 8.3% of Directors
+have legal professional background.
+The Board diversity policy of the Company specifies
+our position in upholding the diversity of the Board, and
+the approaches adopted by us to achieve such diversity.
+We acknowledged and appreciated the benefits brought
+from diversity of the Board, and regards the diversity of the
+Board as a critical factor in achieving our strategic goals,
+maintaining our competitive strengths and achieving our
+sustainable development. We considered the diversity of
+the Board from various aspects, including talents, skills,
+industry experience, cultural and education background,
+gender, age and other factors, when deciding the
+composition of the Board. All appointments of Directors
+shall be decided after taking into consideration of talents,
+skills and experience required for the overall operation of
+the Board.
+The Company has established a nomination policy for
+Directors, setting out the selection criteria and nomination
+procedures of Directors. The Nomination Committee, when
+nominating candidates for Directors, mainly considers
+whether he or she has qualifications for Directors, whether
+he or she complies with laws, administrative regulations,
+rules and the Articles of Association, and also assesses
+his or her reputation, achievement and experience, time
+and energy available, and Director diversity policy. The
+Nomination Committee will summarize the nominees
+before the meeting for consideration by the members of
+the committee. After receiving the nomination proposal
+and the candidate's personal data, the Nomination
+Committee evaluates the candidate based on the above
+criteria to determine whether the candidate is eligible to
+serve as a Director.
+CORPORATE GOVERNANCE
+2021 ANNUAL REPORT 065
+The Nomination Committee convened five meetings
+during the reporting period:
+The main duties of the Nomination Committee of
+the Company are as follows: regularly examining and
+discussing the structure, number of members and
+composition of the Board and making recommendations
+on the change of the Board in compliance with the
+strategy of the Company; researching the standards
+and procedures for the selection of Directors, President
+and other senior management personnel and making
+✓
+recommendations thereon to the Board; researching
+the Board diversity policy and the training system of
+the Directors and the management; selecting qualified
+candidates for Directors and senior management
+personnel, examining the candidates for Directors and
+the President and making recommendations thereon;
+accepting the candidate proposals made by persons
+entitled to nominate such candidates in accordance with
+the Articles of Association; reviewing the independence
+of independent non-executive Directors and providing an
+assessment opinion; appointing representatives to attend
+the general meeting to answer inquiries of investors about
+the work of the Nomination Committee; and other duties
+as required by relevant laws and regulations or listing
+rules of places where the Company is listed and any such
+other matters as authorised by the Board.
+Independent non-executive
+Director
+the Secretary to the Board
+v
+Nomination
+As of December 31, 2021, the
+Committee of the Company comprises three Directors,
+including two independent non-executive Directors, with
+Mr. Dai Houliang, the Chairman, as the chairman of the
+committee, and Mr. Cai Jinyong and Mr. Jiang, Simon X.,
+the independent non-executive Directors, as members.
+(8) Nomination Committee
+(12) Sustainable Development Committee
+The Supervisory Committee of the Company
+discharged its duties diligently in accordance with the
+Articles of Association, including convening Supervisory
+Committee meetings, attending all Board meetings and
+persistently reporting their work to the shareholders'
+general meeting, submitting the Supervisory Committee
+Report and related proposals. In line with the spirit
+of accountability to all shareholders, the Supervisory
+Committee monitored the financial affairs of the Company
+and the performance of duties and responsibilities by
+the Directors, President and other senior management
+personnel of the Company to ensure that they have
+performed their duties in compliance with applicable laws
+and regulations. The Supervisory Committee has made
+good recommendations to major matters of the Company
+including production, operation and investment projects.
+Presidents, Chief Financial Officer and other senior
+management officers carrying out Company duties,
+and to propose removal suggestions of the aforesaid
+officers if they violate laws, administrative regulations, the
+Articles of Association or resolutions of the shareholders'
+general meetings; to ask the Directors, President, Senior
+Vice Presidents, Vice Presidents, Chief Financial Officer
+and other senior management officers to rectify if their
+conducts violate the interest of the Company; to verify the
+financial materials including financial reports, operation
+reports and profit distribution plans to be proposed by the
+Board to the shareholders' general meeting, and, if there
+is any doubt, appoint Certified Public Accountants and
+practicing auditors to review in the name of the Company;
+to propose extraordinary shareholders' meeting and to
+convene and chair shareholders' general meetings when
+the Board fails to perform its duty under the Company Law
+to convene and chair shareholders' general meetings; to
+make proposals for the shareholders' general meetings;
+to represent the Company to negotiate with Directors
+or to bring litigation claims against the Directors,
+President, Senior Vice Presidents, Vice Presidents,
+Chief Financial Officer and other senior management
+officers in accordance with Article 152 of the Company
+Law; to conduct investigation in the event of abnormal
+operation of the Company; to conduct annual review of
+external auditors regarding their performance together
+with the Audit Committee of the Board of Directors and
+to make suggestions regarding engagement, renewal of
+engagement and dismissal of external audits and their
+audit service fees to the shareholders' general meetings; to
+supervise the compliance of the connected transactions.
+During the reporting period, the Supervisory Committee
+conducted four meetings, including two on-site meetings
+and two meetings by written circular, conducted review
+of the 2020 Annual Report, the First Quarterly Report,
+Interim Report, and the Third Quarterly Report of 2021
+of the Company; attended two Board meetings, issued
+five opinions of the Supervisory Committee; attended the
+shareholders' general meetings twice and proposed two
+proposals to the shareholders' general meetings.
+CORPORATE GOVERNANCE
+2021 ANNUAL REPORT 069
+The Supervisory Committee of the Company now
+comprises eight members, including five Supervisors
+representing shareholders (including one Chairman
+of the Supervisory Committee) and three Supervisors
+representing employees. The Supervisory Committee of
+the Company reports to the shareholder's general meeting
+and exercises the following functions according to law: to
+review and propose written review opinion on the regular
+reports of the Company drafted by the Board; to review
+the financials of the Company; to supervise the conducts
+of the Directors, President, Senior Vice Presidents, Vice
+For details of shareholders and shareholder's
+general meetings, please refer to the section entitled
+"Shareholders' Rights and Shareholders' Meetings" in this
+annual report.
+The Sustainable Development Committee of the
+Company consists of three Directors, with Mr. Huang
+Yongzhang as the chairman of the committee, and Mr.
+Jiao Fangzheng and Mr. Ren Lixin as the members.
+(13) Shareholders and Shareholders' General
+Meetings
+During the reporting period, the Sustainable
+Development Committee convened one meeting. On
+March 24, 2021, the Sustainable Development Committee
+convened its committee meeting by way of written
+circular, at which the Health, Safety and Environmental
+Protection Report of the Company for 2021 was reviewed
+and a resolution was passed thereon. All members of the
+Sustainable Development Committee attended all the
+meetings of the committee.
+been set up; reviewing the Company's annual report on
+environment, society and governance and the report on
+quality, safety and environmental protection and making
+proposals to the Board of Directors; paying attention to
+the important information of sustainable development
+matters related to the Company's business, and making
+proposals to the Board of Directors when it is estimated
+that the environmental, society and governance matters
+may have a significant impact on the stakeholders; other
+matters authorized by the Board of Directors..
+(15) Directors' Responsibility in Preparing Financial
+Statements
+(14) Supervisors and the Supervisory Committee
+The Directors are charged with the responsibility to
+prepare the financial statements in each financial year
+with support from the accounting departments, and to
+ensure that the relevant accounting practices and policies
+are observed and IFRS and CAS are complied with in the
+compilation of such financial statements in order to report
+the financial position of the Company in a factual and
+unbiased manner.
+For information relating to the risk management
+and internal control of the Company, please refer to the
+sections of the Improvement of Corporate Governance
+Improvement of Internal Control System.
+The Directors, having made appropriate enquiries,
+consider that the Company has adequate resources to
+continue in operational existence for the foreseeable future
+and that, for this reason, it is appropriate to adopt the
+going concern basis in preparing the financial statements.
+(17) Remuneration of the Auditors
+For information relating to the remuneration received
+by the auditors for their auditing services to the Company,
+please refer to the section of "Significant Events” for the
+070 PETROCHINA COMPANY LIMITED
+CORPORATE GOVERNANCE
+PetroChina
+part entitled "Engagement and disengagement of firm of
+accountants" in this annual report.
+(18) Risk Management and Internal Control
+conduct for staff and workers, and significant differences
+on corporate governance regulations pursuant to the
+requirements under section 303A.11 of the New York
+Stock Exchange Listed Company Manual can be found
+on the Company's website (www.petrochina.com.cn). You
+may access to such information by following these steps:
+1. From our main web page, click "Investor Relations";
+2. Next, click "Corporate Governance Structure";
+(19) Others
+During the reporting period, the Investment and
+Development Committee convened one meeting. On
+December 20, 2021, the Investment and Development
+Committee convened a meeting by way of written
+circular, at which the committee reviewed the Business
+Development and Investment Plan of the Company for
+2022 and passed a resolution thereon. All members of the
+Investment and Development Committee attended all the
+meetings of the committee.
+Relevant information
+(16) Going Concern
+to the Board; conducting research and making
+recommendations on other major issues affecting the
+Company's development; relevant laws, regulations and
+listing rules of jurisdictions where Company's shares are
+listed and other matters authorized by the Board.
+The main duties and responsibilities of the
+Sustainable Development Committee are: supervising
+and studying the sustainable development (including
+but not limited to environment, society and governance)
+matters of the Company, identifying and assessing major
+risks and impacts on the sustainable development of the
+Company, strengthening risk management in respect of
+environment, society and corporate governance and
+making proposals to the Board of Directors; supervising the
+Company's commitments and performance on key issues
+such as responding to climate change, safeguarding
+health and safety and fulfilling social responsibilities and
+making proposals to the Board of Directors; reviewing the
+relevant guidelines, strategies, objectives, measures and
+relevant important issues in relation to the sustainable
+development of the Company, and supervising and
+reviewing the implementation of the sustainable
+development objectives of the Company based on the
+relevant sustainable development objectives that have
+CORPORATE GOVERNANCE
+on corporate governance,
+mechanisms for assessment of performance and
+performance incentives and restrictions of the Company,
+information disclosure and transparency, the relationship
+between CNPC and the Company, performance of duty
+by independent non-executive Directors, professional and
+ethical code for senior management personnel, code of
+CORPORATE GOVERNANCE
+PetroChina
+(9) Audit Committee
+As of December 31, 2021, the Audit Committee of
+the Company comprises two independent non-executive
+Directors, with Mr. Cai Jinyong as the chairman, Mr. Jiang,
+Simon X. as a member, and a non-executive Director, Mr.
+Liu Yuezhen as a member.
+Under the Rules of Procedures of the Audit Committee
+of the Company, the chairman of the committee must be
+an independent non-executive Director and all resolutions
+of the committee shall be approved by the independent
+non-executive Directors.
+The major responsibilities of the Audit Committee of the
+Company are: reviewing and ensuring the completeness
+of annual reports, interim reports and quarterly reports
+and related financial statements and accounts, and
+reviewing any material opinion contained in the aforesaid
+statements and reports in respect of financial reporting;
+reporting to the Board in writing on the financial reports
+of the Company (including annual reports, interim reports
+and quarterly reports) and related information; reviewing
+and supervising the work conducted by the internal audit
+department in accordance with the applicable PRC and
+international rules; monitoring the financial reporting
+system and internal control procedures of the Company,
+as well as checking and assessing matters relating to,
+among others, the financial operations, internal control
+and risk management of the Company; reviewing and
+supervising the engagement of external auditors and
+their performance; receiving, keeping and dealing with
+complaints or anonymous reports regarding accounting,
+internal accounting control or audit matters and ensuring
+the confidentiality of such complaints or reports; liaising
+with the Board, the senior management and external
+accountants on a regular basis; meeting with external
+accountants and the Company's own legal counsel at
+least once a year; and reporting regularly to the Board
+in respect of any significant matters which may affect the
+financial position and business operations of the Company
+and in respect of the self-evaluation of the committee on
+the performance of their duties.
+During the reporting period, the Audit Committee held
+five meetings, of which four meetings were conducted by
+way of written circular and one meeting was held onsite
+and by video conference. All resolutions adopted by the
+Audit Committee have been submitted to all directors for
+review at Board meetings.
+On March 23, 2021, the Audit Committee met by way
+of written circular to consider 6 proposals including the
+Annual Financial Report of the Company for 2020, the
+Profit Distribution Proposal for 2020, the Report on the
+Company's Continuing Connected Transactions in 2020,
+the Report on Internal Controls of the Company in 2020,
+the Report on Audit Work of the Company in 2020, and
+the Proposal for Changing the Domestic and Overseas
+Accounting Firms of the Company for 2021, and review
+the Report of KPMG Addressed to the Audit Committee
+and passed resolutions thereon.
+On April 28, 2021, the Audit Committee convened
+a meeting by way of written circular to review the First
+Quarterly Report of the Company for 2021 and the
+Proposal for Proposed Participation in the Establishment
+of Industrial Investment Company, and passed resolutions
+thereon.
+On August 25, 2021, the Audit Committee met
+onsite and by video conference to review 6 proposals
+including the Interim Financial Report of the Company
+for 2021, the Interim Profit Distribution Proposal of the
+Company for 2021, the Interim Report on the Continuing
+Connected Transactions of the Company in 2021, the
+Report on Internal Controls, the Report on the Audit Work
+of the Company, the Proposal for Payment of the Audit
+Fees of the Auditors for 2021, and listened to the Report
+of PricewaterhouseCoopers Zhong Tian LLP Addressed
+to the Audit Committee and passed resolutions thereon.
+On October 27, 2021, the Audit Committee convened
+2021 ANNUAL REPORT
+PetroChina
+067
+a meeting by way of written circular to review the Third
+Quarterly Report of the Company in 2021 and passed the
+resolution thereon.
+On December 20, 2021, the Audit Committee
+convened a meeting by way of written circular to review
+2 proposals including the Report on Internal Controls
+and the Report on the Audit Work of the Company, and
+review the Report of PricewaterhouseCoopers Zhong
+Tian LLP Addressed to the Audit Committee, and passed
+resolutions thereon.
+President and reporting to the Board, and monitoring the
+performance assessments to be conducted by the President
+on Senior Vice Presidents, Vice Presidents, the Chief
+Financial Officer and other senior managers; considering
+the Company's incentive programme and remuneration
+system; monitoring and appraising the effectiveness of their
+implementation, and providing recommendations for reform
+and improvement; and other duties as required by relevant
+laws and regulations or listing rules of place where the
+Company is listed and any such other matters as authorised
+by the Board.
+In addition, the Audit Committee carried out
+the independence check and the business approval
+procedure regarding the non-audit project conducted
+by PricewaterhouseCoopers Zhong Tian LLP (Special
+General Partnership).
+All the resolutions or opinions on reviewing and
+considering were submitted to the Board and, if applicable,
+put into action. All members of the Audit Committee
+attended all the meetings of the committee.
+During the reporting period, the Examination and
+Remuneration Committee convened one meeting. On
+March 23, 2021, the Examination and Remuneration
+Committee met by way of written circular to review the
+Report on Assessment of the Results of Operations by
+the President's Work Team for 2020 and the Formulation
+of President's Performance Contract for 2021 and the
+Proposal for Adjusting the Remuneration of Independent
+Directors and passed resolutions thereon. All members of
+the Examination and Remuneration Committee attended
+all the meetings of the committee.
+(10) Examination and Remuneration Committee
+As of December 31, 2021, the Examination and
+Remuneration Committee of the Company consists of
+two independent non-executive Directors and one non-
+executive Director, with Ms. Elsie Leung Oi-sie as the
+chairman of the committee, and Mr. Tokuchi Tatsuhito and
+Mr. Liu Yuezhen as members.
+(11) Investment and Development Committee
+The Investment and Development Committee of the
+Company consists of three Directors, with Mr. Hou Qijun
+as the chairman of the committee, and Mr. Duan Liangwei
+and Mr. Simon Henry as members.
+and
+The main duties and responsibilities of the Examination
+Remuneration Committee are: considering the
+performance assessment criteria of Directors and
+management, conducting performance assessment and
+making relevant recommendations; considering and
+reviewing remuneration policies and schemes in respect of
+Directors and senior management (including compensations
+to Directors and senior management for loss of office or
+retirement); organising the performance assessment on the
+The main duties and responsibilities of the Investment
+and Development Committee are: conducting research on
+the Company's long-term development strategy proposed
+by the President and making recommendations to the
+Board; conducting research on the annual investment
+plan and adjustment of investment plan proposed by the
+President, and making recommendations to the Board;
+reviewing feasibility study report and pre-feasibility study
+report of the major investment and financing plan, major
+capital operation, asset management project that require
+the decision of the Board, and making recommendations
+068 PETROCHINA COMPANY LIMITED
+CORPORATE GOVERNANCE
+3. Finally, click on the information you are looking for.
+(4) Group insurance
+2021 ANNUAL REPORT
+the date of the evaluation may also result in revision of the
+reserves data of the Group to a certain extent.
+According to industry characteristics and
+international practices, both the crude oil and natural
+gas reserve data disclosed by the Group are estimates
+only. The Group has engaged internationally recognised
+valuers to evaluate the crude oil and natural gas reserves
+of the Group on a regular basis. However, the reliability
+of reserves estimates depends on a number of factors,
+assumptions and variables, such as the quality and
+quantity of technical and economic data, the prevailing
+oil and gas prices of the Group etc., many of which are
+beyond the control of the Group and may be adjusted
+over time. Results of drilling, testing and exploration after
+(5) Uncertainty of the Oil and Gas Reserves Risk
+The Group has distinctive advantages in resources,
+and is in a leading position in the oil and gas industry in
+the PRC. At present, major competitors of the Group are
+other large domestic oil and petrochemical producers
+and distributors. With the gradual opening up of the
+domestic oil and petrochemical market, large foreign oil
+and petrochemical companies have become competitors
+of the Group in certain regions and segments. The Group
+has been in a leading position in the exploration and
+production business and natural gas business in China,
+but the Group is facing relatively keen competition in
+refining, chemicals and marketing of refined products
+businesses.
+(4) Market Competition Risk
+foreign currencies. Currently, the PRC government has
+implemented a regulated floating exchange rate regime
+based on market supply and demand with reference to a
+basket of currencies. However, Renminbi is still regulated
+in capital projects. The exchange rates of Renminbi
+are affected by domestic and international economic
+and political changes, and demand and supply for
+Renminbi. Future exchange rates of Renminbi against
+other currencies may vary significantly from the current
+exchange rates, which in turn would affect the operating
+results and financial position of the Group.
+PetroChina
+DIRECTORS' REPORT
+074 PETROCHINA COMPANY LIMITED
+in the PRC, but it keeps certain foreign currencies to pay for
+the imported crude oil, equipment and other raw materials
+as well as to repay financial liabilities denominated in
+The Group conducts its business primarily in Renminbi
+(3) Foreign Exchange Rate Risk
+The Group is engaged in a wide range of oil and
+gas products-related activities and part of its oil and gas
+products demands are met through external purchases
+in international market. The prices of crude oil, refined
+products and natural gas in the international market are
+affected by various factors such as changes in global and
+regional politics and economy, demand and supply of
+oil and gas, as well as unexpected events and disputes
+with international repercussions. The domestic crude oil
+price is determined by reference to international price of
+crude oil and the prices of domestic refined products are
+adjusted by PRC government to reflect the price changes
+in international crude oil market. Domestic natural gas
+prices are prescribed by PRC government.
+(2) Price Fluctuations of Crude Oil and Refined
+Products Risk
+The PRC government exercises supervision and
+regulation over the domestic oil and natural gas industry.
+These regulatory measures include the obtaining of
+exploration and production licences, the payment of
+industry-specific taxes and levies, and the implementation
+of environmental protection policies and safety standards.
+They affect the Group's operating activities. Any future
+changes in the PRC governmental policies in respect of
+the oil and natural gas industry may also affect the Group's
+business operations.
+(6) Overseas Operations Risk
+(1) Industry Regulations and Tax Policies Risk
+As the Group operates in a number of countries
+around the world, it is subject to the influences of different
+political, legal and regulatory factors prevailing in the
+countries of operation, including countries which are
+not very stable and are greatly different from developed
+countries in certain material aspects. The risks involved
+principally include instability as to political environment,
+taxation policies and regulatory requirements, as well as
+import and export restrictions.
+The oil industry has been facing ever increasing
+challenges posed by global climate change in recent
+years. A number of international, domestic and regional
+agreements restricting greenhouse gas emission have
+been signed and become effective. If China or other
+countries in which the Company operates take more
+stringent measures to reduce greenhouse gas emission,
+the revenue and profits earned by the Group may reduce
+as a result of substantial capital expenditures and taxation
+expenditures and increases in operating costs incurred
+and even the strategic investments of the Group may be
+subject to the unfavourable impact posed by the related
+laws, regulations and regulatory requirements.
+076 PETROCHINA COMPANY LIMITED
+The Group carries limited insurance coverage for
+certain assets subject to significant operating risks, and
+has purchased third-party liability insurance against claims
+relating to personal injury, property and environmental
+damages arising from accidents and employer's liability
+insurance. The effect of non-coverage on future incidents
+on the Company's liability cannot be reasonably assessed
+at present.
+During the reporting period, the Company has
+complied with laws, regulations and supervision provisions
+domestic and abroad. The management of the Group
+believes that any liabilities resulting from insignificant
+lawsuits as well as other proceedings arising in ordinary
+course of business of the Group will not have a material
+adverse effect on the financial position of the Group.
+(3) Legal contingencies
+Under the existing laws and regulations, management
+of the Group believes that there are no probable
+environmental liabilities, except for the amounts which
+have already been reflected in the consolidated financial
+statements, that will have a material adverse effect on the
+financial position of the Group.
+China has issued extensive environmental laws and
+regulations that affect the operation of the oil and gas.
+(2) Environmental liabilities
+As at December 31, 2020 and 2021, the Group did not
+provide material guarantees to loans to other companies
+nor have any other material guarantee matters.
+(1) Bank and other guarantees
+3. Contingent Liabilities
+regulations promulgated by the State in recent years set
+out higher standard for production safety. The Group has
+implemented a strict HSE management system and used
+its best endeavours to avoid the occurrence of accidents.
+However, the Group cannot completely avoid potential
+financial losses caused by such contingent incidents.
+The Group has adopted strict implementation of laws
+and regulations of the State, and effectively controlled
+the major safety and environmental hazards found. In
+addition, natural disasters such as earthquake, typhoon,
+tsunami and emergency public health events (such as the
+outbreak of COVID-19) may cause losses to properties
+and personnel of the Group, and may affect the normal
+operations of the Group.
+DIRECTORS' REPORT
+2021 ANNUAL REPORT 075
+Oil and gas exploration, development, storage
+and transportation and the production, storage and
+transportation of refined products and petrochemical
+products involve certain risks, which may cause
+unexpected or dangerous events such as personal injuries
+or death, property damage, environmental damage and
+disruption to operations, etc. With the expansion in the
+scale and area of operations, the hazard risks faced
+by the Group also increase accordingly. Further, new
+The Board will review such rules in accordance
+with the relevant regulatory requirements and the actual
+circumstances of the Company on an annual basis.
+(7) Risk Relating to Climate Change
+In its course of production and operation, the Group
+actively took various measures to avoid and mitigate
+various types of risks. However, in practice, it may not be
+possible to prevent all risks and uncertainties completely.
+(8) Hidden Hazards and Force Majeure Risk
+Please refer to the sections headed "Business
+Review", "Discussion and Analysis of Operations" and
+"Chairman's Report" in this annual report.
+PetroChina
+SHAREHOLDERS' RIGHTS AND SHAREHOLDERS' MEETINGS
+072 PETROCHINA COMPANY LIMITED
+Pursuant to the Articles of Association in respect of
+convening an annual general meeting, any shareholder(s)
+holding 3% or above of the total number of shares of
+the Company with voting rights may put forward any
+provisional proposal(s) in writing to the convenor ten
+days prior to the general meeting. The convenor shall,
+within two days upon receipt of the proposal(s), serve
+a supplemental notice of general meeting, announcing
+the contents of such provisional proposals. The contents
+of any such proposals shall fall within the purview of
+the general meeting, with clear and definite issues for
+consideration and substantive matters for resolution and
+in compliance with laws, administrative rules and the
+Articles of Association.
+(2) Procedures for putting proposals to a general
+meeting
+If the Supervisory Committee fails to serve the notice
+of shareholders' meeting within the period as provided,
+it shall be deemed as the Supervisory Committee not
+convening and presiding over the meeting. One or
+more shareholders holding in aggregate 10% or above
+of the shares of the Company with voting rights for 90
+consecutive days or above is/are entitled to convene and
+preside over such meeting on its/their own.
+If the Supervisory Committee agrees to convene
+such extraordinary general meeting or class meeting, it
+shall, within five days upon receipt of such request, serve
+a notice of meeting. Consent of the relevant shareholder(s)
+shall be sought for any variation to the original request.
+If the Board disagrees to convene such extraordinary
+general meeting or class meeting, or fails to respond within
+ten days upon receipt of the request, the individual or the
+shareholders holding in aggregate 10% or above of the
+shares of the Company with voting rights is/are entitled
+to recommend in writing to the Supervisory Committee
+to convene such extraordinary general meeting or class
+meeting.
+To ensure that all shareholders of the Company
+enjoy equal rights and exercise their rights effectively,
+the Articles of Association of the Company provides
+that an extraordinary general meeting or class meeting
+may be called upon by shareholders according to
+the following procedures: one or more shareholders
+holding in aggregate 10% or above of the shares of the
+Company with voting rights is/are entitled to request the
+Board to convene an extraordinary general meeting or
+class meeting in writing. The Board shall, within ten days
+upon receipt of the request, make available their written
+comments on their agreeing or disagreeing with the
+convening of such extraordinary general meeting or class
+meeting.
+(1) Shareholders' procedures to propose to convene
+an extraordinary general meeting
+1. Shareholders' rights
+SHAREHOLDERS' RIGHTS AND
+SHAREHOLDERS' MEETINGS
+SHAREHOLDERS' RIGHTS AND SHAREHOLDERS' MEETINGS
+071
+2. Risk Factors
+Should any shareholder wish to make a proposal
+in accordance with the Articles of Association, both the
+annual report of the Company and the "Investors Relations"
+section of the Company's website provide specific contact
+information.
+(3) Procedures for enquiries of shareholders made
+with the Board of Directors
+If the Board agrees to convene such extraordinary
+general meeting or class meeting, it shall, within five days
+upon passing the Board resolution, serve a notice of the
+meeting. Consent of the relevant shareholder(s) shall be
+sought for any variation to the original request.
+A question-and-answer session is in place in any
+general meeting of the Company. Questions from any
+shareholder will be answered by the Chairman, Vice
+Chairman, President and Independent Directors or
+intermediary. Forms for written questions are available to
+any shareholders who are not able to ask any questions
+due to time limitation. Such written questions will be
+answered in detail by the Investors' Relations Department
+of the Company. Shareholders may also make more
+frequent use of the mailbox of the Secretary to the Board
+on the website of the Company. Issues of concern to
+shareholders are answered by the Company in a prompt
+Taxes and levies are one of the major external
+factors affecting the operations of the Group. The PRC
+government has been actively implementing taxation
+reforms, which may lead to future changes in the taxes
+and levies relating to the operations of the Group, thereby
+affecting the operating results of the Group.
+Any shareholder may make any written enquiry with
+the Board at any time. The administrative measures of the
+Company in respect of management of investors' relations
+provide for clear and definite procedures for enquiries.
+Definite guidelines in respect of contact details are also set
+out in the annual report of the Company and the "Investors
+Relations" section on the website of the Company.
+1. Review of results of operations and the
+business prospect of the Company during
+the reporting period
+The Board of the Company is pleased to present its
+Directors' report for perusal.
+DIRECTORS' REPORT
+073
+2021 ANNUAL REPORT
+DIRECTORS' REPORT
+On June 10, 2021, the annual general meeting for
+2020 of the Company was held at V-Continent Wuzhou
+The Company convened two shareholders' general
+meeting pursuant to its Articles of Association:
+2. Shareholders' meetings
+On October 21, 2021, the first extraordinary general
+meeting of 2021 was convened in Beijing Soluxe Heyi
+Hotel Tarim. One ordinary resolution, i.e. the Resolution on
+the Election of Additional Directors of the Company, was
+reviewed and adopted at the meeting by more than half of
+the affirmative votes. None of the independent Directors
+of the Company raised any oppositions at the general
+meeting.
+Pleases refer to the announcements published by the
+Company on the website of Hong Kong Stock Exchange
+and Shanghai Stock Exchange, for resolutions passed at
+the annual general meeting and details.
+Pleases refer to the announcements published by
+the Company on the website of the Hong Kong Stock
+Exchange and the Shanghai Stock Exchange, for the
+resolution passed at the extraordinary general meeting
+and details.
+Hotel. Seven ordinary resolutions were reviewed and
+adopted at the meeting by more than half of the affirmative
+votes, which included the Report of Board of Directors
+for the year 2020, Report of the Supervisory Committee
+for the year 2020, Financial Report for the year 2020, the
+Profit Distribution Proposal for the year 2020, Resolution of
+Authorisation to the Board of Directors to decide on 2021
+Interim Profit Distribution Plan, Resolution of Changing
+Domestic and International Accounting Firms of the
+Company for the year 2021, Resolution on Guarantee
+Matters of the Company for the year 2021. One special
+resolution was reviewed and adopted at the meeting by
+more than two thirds of the affirmative votes, which was
+the Resolution on Granting General Mandate to the Board
+of Directors in Relation to Issuance of Debt Financing
+Instruments. None of the independent Directors of the
+Company raised any oppositions at the general meeting.
+manner.
+084 PETROCHINA COMPANY LIMITED
+In 2021, the Supervisory Committee attended two
+shareholders' general meetings, at which the Supervisory
+Committee submitted two proposals, including the
+Supervisory Committee's Report of the Company for 2020
+and the Proposal for Changing Overseas and Domestic
+Accounting Firms for the Company. Such proposals were
+reviewed and approved by the shareholders' general
+meeting.
+On April 29, 2021, the Supervisory Committee
+convened the seventh meeting of the eighth session of
+the Supervisory Committee by way of written circulation.
+The First Quarterly Report of 2021 was reviewed and
+approved at the meeting.
+On August 24, 2021, the Supervisory Committee
+convened the eighth meeting of the eighth session of the
+Supervisory Committee by way of on-site meeting. The
+meeting was chaired by Mr. Lv Bo, the Chairman of the
+Supervisory Committee. At the meeting, three proposals,
+including the Review Opinion of the Supervisory
+Committee on the Interim Financial Report of 2021, the
+Review Opinion of the Supervisory Committee on the
+Interim Profit Distribution Plan of 2021 and the Review
+Opinion of the Supervisory Committee on the Interim
+Report and Interim Results Announcement of 2021, were
+reviewed and approved.
+The Supervisory Committee attended three meetings
+of the Board and heard the Board's review of the proposals
+in relation to the Annual Report of 2020 and the Interim
+Report of 2021 and their summaries, profit distribution,
+connected transactions, 2022 investment plan and budget,
+and other relevant proposals. The Supervisory Committee
+presented five opinions to the Board in respect of, inter
+alia, its review of the financial statements of the Company,
+profit distribution plan (draft plan), and the performance
+assessment of the President. The Supervisory Committee
+also put forward recommendations on the issues such
+as accelerating business development in new energy,
+improving the construction of the Company's corporate
+governance capacity, continuously improving the quality
+and profitability of the Company and the management of
+loss-making enterprises.
+Further, the Supervisory Committee made effort
+to promote the ability and level of duty performance
+of its members by means of participating in activities
+organised by China Association for Public Companies
+and communicating with peers.
+2. Supervisory Committee's presence at
+other meetings and performance of other
+works
+On October 28, 2021, the Supervisory Committee
+convened the ninth meeting of the eighth session of the
+Supervisory Committee by way of written circulation. At
+the meeting, the Third Quarterly Report of 2021 of the
+Company was reviewed and approved.
+the Supervisory Committee on Financial Report of 2020,
+the Review Opinion of the Supervisory Committee on the
+Draft Profit Distribution Plan of 2020, the Opinion of the
+Supervisory Committee on Assessment of the Results of
+Operations by the President for 2020, the Proposal of the
+Supervisory Committee for Changing Accounting Firms
+of the Company, the Supervisory Committee's Report
+of the Company for 2020, the Supervisory Committee's
+Work Summary for 2020 and Working Plan for 2021, the
+Environment, Society and Governance Report of the
+Company for 2020 and the Annual Report and Annual
+Results Announcement of the Company for 2020, were
+reviewed and approved.
+Dear Shareholders,
+083
+2021 ANNUAL REPORT
+On March 23, 2021, the Supervisory Committee convened the sixth meeting of the eighth session
+of the Supervisory Committee by way of on-site meeting. The meeting was chaired by Mr. Lv Bo, the
+Chairman of the Supervisory Committee. At this meeting, eight proposals, including the Review Opinion of
+During the reporting period, the Company held four meetings of the Supervisory Committee, and
+successfully completed the review of the 2020 Annual Report, the First Quarterly Report, Interim Report
+and the Third Quarterly Report of 2021 of the Company, and disclosed relevant information as required by
+regulators.
+1. Meetings of the Supervisory Committee
+During the year of 2021, the Supervisory Committee has performed and discharged its duties and
+responsibilities conscientiously in accordance with the relevant provisions of the Company Law of the
+People's Republic of China and the Articles of Association.
+REPORT OF THE SUPERVISORY COMMITTEE
+Lv Bo Chairman of the Supervisory Committee
+REPORT OF THE SUPERVISORY COMMITTEE
+REPORT OF THE SUPERVISORY COMMITTEE
+PetroChina
+By Order of the Supervisory Committee
+Lv Bo
+Chairman of the Supervisory Committee
+The Supervisory Committee believed that, in 2021,
+the Company seized favorable opportunities such as
+the rising international oil prices, the continuous stable
+recovery of China's economy, and high demand in the oil
+and gas market, earnestly implemented the resolutions
+and deployments of the shareholders' general meeting and
+the Board of Directors, promote business development,
+reform and innovation, enhancement of quality and
+profitability, safety and environmental protection,
+epidemic prevention and control and other work in an
+overall manner, maintained the smooth operation of the
+oil and gas industry chains, made solid progress in the
+green and low-carbon transformation, and achieved the
+best operating results in seven years for the same period.
+The Supervisory Committee was satisfied with the results
+achieved by the Company.
+082 PETROCHINA COMPANY LIMITED
+PETROCHINA COMPANY LIMITED
+086
+Beijing, the PRC
+March 31, 2022
+In 2021, the Company, strictly complying with the
+regulations, initiatively responded to the concerns of the
+investors, further improved the quality of the report, actively
+transmitted the Company's ESG management ideas,
+objectives and various measures, and fully manifested the
+new achievements such as the Company's governance,
+(5) Opinion of the Supervisory Committee on the
+Company's Environmental, Social and Governance Report
+Company made solid progress in the construction of the
+internal control system and supervision on various work
+by adhering to redressing its shortcomings, consolidating
+its fundamentals and revitalizing its capabilities, which
+effectively made use of function of strengthening the
+basis and consolidating the foundation of the internal
+control system, with exceptional matters identified by the
+management being rectified completely and no material
+defect being found in the internal control.
+REPORT OF THE SUPERVISORY COMMITTEE
+2021 ANNUAL REPORT 085
+In 2021, in accordance with the requirements and
+arrangements of the Board, the internal control of the
+(4) Opinion of the Supervisory Committee on the
+operation of the internal control system of the Company
+and on the self-assessment report on the internal control
+of the Company
+The Company strictly complied with laws and
+regulations of China, conscientiously performed the
+regulatory requirements of the places of listing regarding
+connected transactions, fully performed various
+agreements and contracts with connected persons, and
+conducted such connected transactions in a regularized
+manner. All types of the connected transactions of the
+Company were conducted within the approved caps.
+(3) Opinion of the Supervisory Committee on
+connected transactions of the Company
+The annual financial reports of the Company have
+been prepared in accordance with CAS and IFRS,
+respectively. The financial reports of the Company audited
+by PricewaterhouseCoopers Zhong Tian LLP (Special
+General Partnership) and PricewaterhouseCoopers give a
+true and fair view on the financial positions, operating results
+and cash flows of the Company. The standard unqualified
+audit reports issued by them are objective and fair.
+In 2021, the Company achieved record highs in
+revenue, and the total profit and net profit reached
+the record highs in the last few years respectively. The
+interest-bearing debt balance and the capital-to-liability
+ratio were the lowest in the past more than ten years, and
+the cost of financing was the lowest since listing. Free
+cash flow increased significantly year-on-year, and the
+financial position continued to maintain stable.
+(2) Opinion of the Supervisory Committee on
+inspection of the financial status of the Company
+In 2021, the Company conscientiously complied
+with the provisions of the relevant laws and regulations
+of China and places of listing and carried out its activities
+accordingly. The convening procedures for, voting
+methods applicable to and meeting resolutions adopted
+at shareholders' general meetings and Board meetings
+were legally valid, and the information was disclosed to
+the public in a timely, accurate and complete manner. No
+director or senior management personnel of the Company
+was found violating laws, regulations or the Articles of
+Association or involved in any act to harm the interests of
+the Company and the shareholders in the performance of
+his/her duties.
+(1) Opinion of the Supervisory Committee on the
+lawful operation of the Company
+4. Other matters reviewed or concerned by
+the Supervisory Committee
+3. Supervisory Committee's opinion on the
+works of the Company
+March 31, 2022
+energy transformation, environmental protection,
+employee development and social contribution. The
+Supervisory Committee has approved the Company's
+Environment, Society and Governance Report.
+Chairman
+6
+Duan Liangwei
+2
+Hou Qijun
+6
+Dai Houliang
+proxy (times)
+Attendance by
+Attendance in
+person (times)
+Liu Yuezhen
+Meetings
+Number of Required
+Non-executive Director
+Non-executive Director
+Vice Chairman
+Chairman
+Position
+(2) Composition of the Current Board and attendance rate of the Board Meetings in 2021
+DIRECTORS' REPORT
+2021 ANNUAL REPORT 077
+Name
+6
+Jiao Fangzheng
+66
+6
+6
+6
+Tokuchi Tatsuhito
+Simon Henry
+6
+Elsie Leung Oi-sie
+0
+2
+2
+0
+1
+Huang Yongzhang
+Ren Lixin
+Note:
+Independent non-executive Director
+Independent non-executive Director
+Independent non-executive Director
+Independent non-executive Director
+Independent non-executive Director
+Executive Director and President
+Executive Director and Senior Vice
+President
+Non-executive Director
+0
+0
+0
+0
+626650
+For specific information on meetings and the relevant resolutions of the Board meetings, please refer to the
+announcements uploaded on the websites of Hong Kong Stock Exchange and Shanghai Stock Exchange after each
+Board meeting.
+On-site meeting and video
+conference
+December 21, 2021
+Thirteenth meeting of the 8th Session of the Board of Directors
+DIRECTORS' REPORT
+Completion and
+Production Phase
+1,250
+1,620
+Oilfield
+recovery in Tarim
+The project of ethane
+Construction Phase
+2,948
+6,494
+Construction Phase
+52,344
+65,430
+Progress of project
+Cumulative
+investment
+amount
+Total project
+The project of 600,000
+tons/year ABS and its
+supporting projects at
+Jieyang, Guangdong
+The integration
+project of refining
+and chemicals
+of Guangdong
+Petrochemical
+Name of project
+4. Projects not Funded by Proceeds from Fund Raising
+PetroChina
+Jiang, Simon X.
+Unit: RMB million
+Evaluations show that the projects meet
+the Company's return benchmarks. As it is
+currently under the construction phase, the
+actual efficiency generated from this project
+is still subject to verification.
+Evaluations show that the projects meet
+the Company's return benchmarks. As it is
+currently under the construction phase, the
+actual efficiency generated from this project
+is still subject to verification.
+Evaluations show that the projects meet
+the Company's return benchmarks. As it is
+currently under the initial production phase,
+the actual efficiency generated from this
+project is still subject to verification.
+6
+On-site meeting and video
+conference
+By circulation
+August 25 to 26, 2021
+October 28, 2021
+Twelfth meeting of the 8th Session of the Board of Directors
+5
+4 Eleventh meeting of the 8th Session of the Board of Directors
+By circulation
+By circulation
+April 29, 2021
+July 20, 2021
+Ninth meeting of the 8th Session of the Board of Directors
+Tenth meeting of the 8th Session of the Board of Directors
+23
+conference
+March 24 to 25, 2021
+Method
+On-site meeting and video
+Eighth meeting of the 8th Session of the Board of Directors
+1
+Date
+Title
+No.
+During the reporting period, the Board convened three on-site Board meetings and video conferences and three
+extraordinary Board meetings by way of written circular, and passed 31 Board resolutions. The specific information is set
+out as below:
+(1) The convening of Board meetings and the issues resolved
+5. Operations of the Board of Directors
+Project return
+6
+Cai Jinyong
+103 10
+17. Pre-emptive Rights
+As at December 31, 2021, the Company did not have
+trust deposits or irrecoverable overdue time deposits.
+16. Trust Deposits and Irrecoverable
+Overdue Time Deposits
+The Group did not sell any securities of the Group,
+nor did it repurchase or redeem any of the securities of
+the Group during the twelve months ended December 31,
+2021.
+15. Repurchase, Sale or Redemption of
+Securities
+During the reporting period, all the five largest
+suppliers and the five largest customers of the Company,
+except for CNPC, are our independent third parties.
+The aggregate purchase attributable to the five
+largest suppliers of the Group accounted for approximately
+26% of the Group's total purchase in 2021, among which
+the purchase attributable to the largest supplier of the
+Group accounted for approximately 16% of Group's total
+purchase. The aggregate revenue derived from the major
+customers is set out in Note 37 to the financial statements
+prepared in accordance with IFRS in this annual report.
+The aggregate revenue derived from the five largest
+customers accounted for approximately 11% of the
+Group's total sales.
+14. Major Suppliers and Customers
+DIRECTORS' REPORT
+2021 ANNUAL REPORT 079
+During the reporting period, the Company did not
+enter into any management contracts concerning the
+management or administration of its overall business or
+any of its material business, nor did any such management
+contract exist.
+13. Management Contract
+Details of bank loans and other borrowings of the
+Company and the Group as at December 31, 2021 are
+set out in Note 29 to the financial statements prepared in
+accordance with IFRS in this annual report.
+As at December 31, 2021, the reserves of the
+Company that can be distributed as dividends were
+RMB654,956 million.
+12. Distributable Reserves
+Details of changes to the reserves of the Company
+and the Group for the year ended December 31, 2021 are
+set out in Note 31 to the financial statements prepared in
+accordance with IFRS in this annual report.
+11. Reserves
+There was no substantial land value appreciation tax
+payable by the Group during the year.
+10. Land Value Appreciation Tax
+Changes to the fixed assets of the Company and the
+Group during the year are summarised in Note 16 to the
+financial statements prepared in accordance with IFRS in
+this annual report.
+9. Fixed Assets
+There is no provision regarding pre-emptive rights
+under the Articles of Association or the PRC laws.
+Interest capitalised by the Group for the year ended
+December 31, 2021 was RMB1.008 billion.
+18. Sufficiency of Public Float
+19. Performance of Social Responsibilities
+By Order of the Board
+Dai Houliang
+overseas.
+In 2021, the Group invested RMB23,731 million in
+research and development, which represents an increase
+of 3.5% as compared with last year and represents
+0.9% of the operating income of the Company. The ratio
+of research and development input capitalization was
+29.5%. The Company obtained 1,983 Chinese patents.
+As at December 31, 2021, the Company owned a total
+of approximately 19,145 patents obtained in China and
+We take innovation as the first strategy of the
+Company's development, adhere to the orientation of
+technology development of “developing the cause and
+giving priority to science and technology, supporting
+the present and leading the future", and energetically
+strengthen the construction of the technology innovation
+system. We have made new breakthrough in the
+independent innovation, obtained and promoted a batch
+of new important technology achievements, which further
+enhanced the capability of independent innovation and
+core competitiveness, and strongly supported and led the
+development of our main business.
+22. Technological Innovation
+During the reporting period, the Company's donations
+amounted to approximately RMB626 million.
+21. Donations
+DIRECTORS' REPORT
+081
+2021 ANNUAL REPORT
+In 2022, the Company will make further use of its
+resources and market advantages, focus on improving
+people's livelihood, build a happy, harmonious and
+beautiful countryside, and strive to become a national
+model for national rural revitalization, aiming at making
+further contributions to consolidate the achievements of
+poverty alleviation and achieve rural revitalization.
+In 2021, after the end of poverty alleviation in 2020,
+the Company followed the mindset of "adjusting measures
+to local conditions, scientific planning, classified
+guidance, guide according to the situation" to continue
+to promote rural revitalization. We combined the natural
+endowments and development demands of the aided
+areas, gave full play to resource advantages, and relied on
+the "Tmall Flagship Store" in uSmile and other online and
+offline platforms to promote the integration of the products
+and services of poverty-stricken areas into the national
+market and support the revitalization of the industry;
+trained grass-roots cadres, leaders for rural revitalization,
+and professional and technical personnel to support the
+revitalization of personnel; integrated traditional villages
+and modern homestays to create characteristic brands
+and assisted in the construction of hope primary schools
+and intelligent campuses to support the revitalization
+of culture; and assisted in the construction of national
+reserve forests and economic forests to improve the rural
+health conditions and support the revitalization of ecology.
+We contributed to the strength of enterprises to effectively
+consolidated and expanded the achievement of poverty
+alleviation and rural revitalization, producing a good social
+effect.
+20. Poverty Alleviation and Rural
+Revitalization
+Details of the performance of social responsibilities
+by the Company are set forth in the 2021 Environmental,
+Social and Governance Report published on the website
+of Hong Kong Stock Exchange and Shanghai Stock
+Exchange.
+The Company actively implemented the overall work
+arrangements of the State for "carbon peak and carbon
+neutrality", organised the preparation of an action plan for
+the target of "double carbon", continued to recycle vented
+natural gas, sped up the implementation of new energy
+projects, actively explored the construction of carbon
+storage bases, intensified the research of CO 2 recycling
+and transport technologies, promoted the pilot program of
+"rooftop photovoltaic", and planned the transformation of
+"zero carbon" reservoirs.
+and giving priority to environmental protection", deeply
+promotes clean production, energy saving and emission
+reduction, achieves stable operation of the "three wastes"
+pollution prevention and control facilities, stable and
+standard discharge of waste water and gas pollutants,
+compliant disposal of solid waste in accordance with the
+law, and comprehensive reduction of the total amount
+of wastes. The Company continuously promoted the
+construction of green mines, and implemented the
+improvement and transformation of VOCs control. The
+Company strengthened the environmental protection
+management of construction projects, strictly implemented
+the environmental protection of “three simultaneous" and
+the post-pollution permit management system; continuously
+improved the environmental risk prevention and control
+measures, with no major or above environmental pollution
+and ecological damage events occurring during the
+reporting period. The Company strengthened staff health
+management and focused on normalized epidemic
+prevention and control, the vaccination covering rate of all
+employees exceeded 90%.
+PetroChina
+DIRECTORS' REPORT
+080 PETROCHINA COMPANY LIMITED
+The Company always adheres to the concept of
+"development with protection, protection with development,
+The Company actively fulfilled our social
+responsibility, incorporated green and low-carbon
+into our development strategies, strictly abided by the
+Environmental Protection Law of the People's Republic
+of China and other relevant regulations, prevented and
+controlled pollution, strengthened ecological protection
+and strived to become a good global corporate citizen.
+Some of our subsidiaries were classified as the key
+pollutant discharge units announced by the national
+environmental protection authority. Such subsidiaries
+have comprehensively disclosed the environmental
+information on the websites of local environmental
+protection authorities in accordance with the relevant
+provisions of the Ministry of Ecology and Environment of
+the People's Republic of China and the requirements of
+local environmental protection authorities. For subsidiaries
+that were not classified as key pollutant discharge units,
+the information on administrative penalties imposed due to
+environmental issues has been disclosed on the websites
+of local competent environmental protection authorities in
+strict accordance with the requirements of the State and
+local governments. Please see specific disclosures on the
+relevant websites.
+Based on the information that is publicly available to
+the Company and within the knowledge of the Directors,
+the Directors confirm that the Company has maintained the
+amount of public float as required under the Listing Rules
+during the last practicable date prior to the publication of
+this annual report.
+Beijing, the PRC
+8. Interest Capitalisation
+For the summary of the results and of the assets.
+and liabilities of the Group for the last five financial years,
+please read the sub-section "Key Financial Data Prepared
+under IFRS" under the section "Summary of Financial
+Data and Financial Indicators" of this annual report.
+Independent non-executive Director
+Independent non-executive Director
+Executive Director and Senior Vice President
+Executive Director and President
+Non-executive Director
+Non-executive Director
+Non-executive Director
+Vice Chairman
+Chairman
+Attendance in
+Person (times)
+Meetings
+Name
+Position
+Number of Required
+(3) Attendance of the Current Directors at General Meetings for the Year 2021
+5. On October 28, 2021, Mr. Hou Qijun was appointed as the Vice Chairman and Non-executive Director of the Company.
+4. On October 21, 2021, Mr. Hou Qijun and Mr. Ren Lixin were appointed as the Directors of the Company.
+3. On August 26, 2021, Mr. Ren Lixin was appointed as the Senior Vice President of the Company.
+2. On May 10, 2021, Mr. Li Fanrong resigned as the Vice Chairman and Non-executive Director of the Company.
+1. On March 25, 2021, Mr. Duan Liangwei resigned as the President of the Company and was re-designated from Executive Director to
+Non-executive Director; Mr. Huang Yongzhang was appointed as the President and Executive Director of the Company.
+66356
+Independent non-executive Director
+7. Bank Loans and Other Borrowings
+Independent non-executive Director
+Independent non-executive Director
+Hou Qijun
+6. Five-Years Financial Summary
+During the reporting period, for the convening and
+attendance of meetings of the Nomination Committee,
+the Audit Committee, the Investment and Development
+Committee, the Examination and Remuneration Committee
+and Sustainable Development Committee of the Company,
+reference can be made to the relevant parts under the
+Corporate Governance Section of this annual report.
+(5) Work of the special committees of the Board of
+Directors
+All members of the Board have conscientiously
+and tirelessly performed their duties, implemented the
+resolutions passed at the AGM and accomplished all
+tasks as authorized by the AGM according to the relevant
+laws, regulations and rules of the respective jurisdictions
+where Company's shares are listed and the provisions as
+set out in the Company's Articles of Association.
+(4) The implementation of AGM resolutions by the
+Board of Directors
+PetroChina
+DIRECTORS' REPORT
+078 PETROCHINA COMPANY LIMITED
+2
+0
+1
+202222-22222
+101021-22
+Cai Jinyong
+Jiang, Simon X.
+Simon Henry
+Elsie Leung Oi-sie
+Tokuchi Tatsuhito
+Ren Lixin
+Huang Yongzhang
+Jiao Fangzheng
+Liu Yuezhen
+Duan Liangwei
+Dai Houliang
+In 2022, the Supervisory Committee will continue to
+conscientiously perform its duties, and diligently perform
+various work in strict compliance with the Company Law,
+the Articles of Association and other relevant regulations.