##### Table of Contents





UNITED STATES SECURITIES AND
    EXCHANGE COMMISSIONWashington, D.C.
    20549
     Form 20-F
  (Mark One)o

REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR 12(g)
    OF THE SECURITIES EXCHANGE ACT OF 1934orþ

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
    OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended December 31,
    2010.oro

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
    OF THE SECURITIES EXCHANGE ACT OF 1934oro

SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d)
    OF THE SECURITIES EXCHANGE ACT OF 1934Date of event requiring this shell company reportFor the transition period from
    to   Commission File Number
    1-15006
      
 (Exact name of Registrant as
    specified in its charter)
 PetroChina Company
    Limited
 (Translation of
    Registrants name into English)
      The Peoples Republic of
    China (Jurisdiction of
    incorporation or organization)
      9 Dongzhimen North Street
    Dongcheng District, Beijing 100007
    The Peoples Republic of China,
 (Address of principal executive
    offices)
      Li Hualin
    Telephone number: 8610 59986223
    Facsimile number: 8610 62099557
    Email address: suxinliang@petrochina.com.cn
    Address: 9 Dongzhimen North Street, Dongcheng District, Beijing
    100007 The Peoples Republic of China
 (Name, telephone,
    e-mail
    and/or facsimile number and address of registrants contact
    person)
      Securities registered or to be
    registered pursuant to Section 12(b) of the Act.
  Title of Each Class

Name of Each Exchange on Which RegisteredAmerican Depositary Shares, each representing 100 H Shares, par
    value RMB1.00 per share*

New York Stock Exchange, Inc.H Shares, par value RMB1.00 per share

New York Stock Exchange, Inc.**   Securities registered or to be
    registered pursuant to Section 12(g) of the Act.
  None
    (Title of Class)
  Securities for which there is a
    reporting obligation pursuant to Section 15(d) of the
    Act.
  None
    (Title of Class)
   A Shares, par value RMB1.00 per share***

161,922,077,818(1)H Shares, par value RMB1.00 per share

21,098,900,000****     (1):
    
    Includes 157,764,597,259 A Shares
    held by CNPC and 4,157,480,559 A Shares held by the public
    shareholders.   Yes
    þ     No
    o
  Yes
    o     
    No
    þ
    Yes
    þ     No
    o
  Regulation S-T
 Yes
    o     
    No
    o
  Rule 12b-2
 Large Accelerated Filer
    þ
    Accelerated Filer
    o
    Non-Accelerated Filer
    o   o
    U.S. GAAP
    þ
    International Financial Reporting Standards as issued by the
    International Accounting Standards Board
    o
    Other   Item 17
    o     
    Item 18
    o
  Rule 12b-2
 Yes
    o     
    No
    þ
    Yes
    o      No
    o
    *
    
    PetroChinas H Shares are
    listed and traded on The Stock Exchange of Hong Kong Limited.**
    
    Not for trading, but only in
    connection with the registration of American Depository Shares.***
    
    PetroChinas A Shares became
    listed on the Shanghai Stock Exchange on November 5, 2007.****
    
    Includes 1,862,364,900 H Shares
    represented by American Depositary Shares.




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Table of
    Contents
  PageCertain Terms and Conventions


4Forward-Looking Statements


8Part IItem 1





Identity of Directors, Senior Management and
    Advisors


9Item 2





Offer Statistics and Expected Timetable


9Item 3





Key Information


9Exchange Rates


9Selected Financial Data


10Risk Factors


12Item 4





Information on the Company


16Introduction


16Exploration and Production


20Refining and Chemicals


28Marketing


33Natural Gas and Pipeline


35Competition


37Environmental Matters


38Legal Proceedings


39Properties


39Intellectual Property


40Regulatory Matters


40Item 4A





Unresolved Staff Comments


47Item 5





Operating and Financial Review and Prospects


47General


47Operating Results


50Liquidity and Capital Resources


57Off-Balance Sheet Arrangements


62Long-Term Contractual Obligations and Other
    Commercial Commitments and 
    Payment Obligations


62Research and Development


62Trend Information


63Other Information


63Item 6





Directors, Senior Management and Employees


64Directors, Senior Management and Supervisors


64Compensation


74Board Practices


74Employees


76Share Ownership


77Item 7





Major Shareholders and Related Party
    Transactions


77Major Shareholders


77Related Party Transactions


77Interests of Experts and Counsel


78 2




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Table of
    Contents
  PageItem 8





Financial Information


79Financial Statements


79Dividend Policy


79Significant Changes


80Item 9





The Offer and Listing


81Nature of the Trading Market and Market Price
    Information


81Item 10





Additional Information


82Memorandum and Articles of Association


82Material Contracts


82Foreign Exchange Controls


82Taxation


83Documents on Display


88Item 11





Quantitative and Qualitative Disclosures About
    Market Risk


88Item 12





Description of Securities Other Than Equity
    Securities


92Part IIItem 13





Defaults, Dividends Arrearages and
    Delinquencies


92Item 14





Material Modifications to the Rights to Security
    Holders and Use of Proceeds


92Item 15





Controls and Procedures


93Item 16A





Audit Committee Financial Expert


93Item 16B





Code of Ethics


93Item 16C





Principal Accountant Fees and Services


94Item 16D





Exemptions from Listing Standards for Audit
    Committees


94Item 16E





Purchases of Equity Securities by the Issuer and
    Affiliated Purchasers


94Item 16F





Change In Registrants Certifying
    Accountant


95Item 16G





Corporate Governance


95Part IIIItem 17





Financial Statements


96Item 18





Financial Statements


97Item 19





Exhibits


97EX-4.1EX-4.4EX-4.25EX-4.26EX-8.1EX-12.1EX-12.2EX-13.1EX-13.2EX-15.1EX-15.2   3




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CERTAIN
    TERMS AND CONVENTIONS  Conventions
    Which Apply to this Annual Report
    
    CNPC or CNPC group are to our parent,
    China National Petroleum Corporation and its affiliates and
    subsidiaries, excluding PetroChina, its subsidiaries and its
    interests in long-term investments, and where the context refers
    to any time prior to the establishment of CNPC, those entities
    and businesses which were contributed to CNPC upon its
    establishment.
    PetroChina, we, our,
    our company, the company and
    us are to PetroChina Company Limited, a joint stock
    company incorporated in the Peoples Republic of China with
    limited liability and its subsidiaries and branch companies.
    PRC or China is to the Peoples
    Republic of China, but does not apply to Hong Kong, Macau or
    Taiwan for purposes of this annual report.      Conversion
    Table
  1 barrel-of-oil
    equivalent

= 1 barrel of crude oil

= 6,000 cubic feet of natural gas1 cubic meter

= 35.315 cubic feet1 ton of crude oil

= 1 metric ton of crude oil

= 7.389 barrels of crude oil (assuming an API gravity of 34
    degrees)   Certain
    Oil and Gas Terms
    acreage
    
    The total area, expressed in acres, over which an entity has
    interests in exploration or production. Net acreage is the
    entitys interest, expressed in acres, in the relevant
    exploration or production area.condensate
    
    Light hydrocarbon substances produced with natural gas that
    condense into liquid at normal temperatures and pressures
    associated with surface production equipment.crude oil
    
    Crude oil, including condensate and natural gas liquids.developed reserves
    
    Under the new SEC reserve rules, developed reserves are reserves
    of any category that can be expected to be recovered:(i) through existing wells with existing equipment and operating
    methods or in which the cost of the required equipment is
    relatively minor compared to the cost of a new well; and 4




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(ii) through installed extraction equipment and
    infrastructure operational at the time of the reserves estimate
    if the extraction is by means not involving a well.development cost
    
    For a given period, costs incurred to obtain access to proved
    reserves and to provide facilities for extracting, treating,
    gathering and storing the oil and gas.finding cost
    
    For a given period, costs incurred in identifying areas that may
    warrant examination and in examining specific areas that are
    considered to have prospects of containing oil and gas reserves,
    including costs of drilling exploratory wells and
    exploratory-type test wells. Finding cost is also known as
    exploration cost.lifting cost
    
    For a given period, costs incurred to operate and maintain wells
    and related equipment and facilities, including applicable
    operating costs of support equipment and facilities and other
    costs of operating and maintaining those wells and related
    equipment and facilities. Lifting cost is also known as
    production cost.natural gas liquids
    
    Hydrocarbons that can be extracted in liquid form together with
    natural gas production. Ethane and pentanes are the predominant
    components, with other heavier hydrocarbons also present in
    limited quantities.offshore
    
    Areas under water with a depth of five meters or greater.onshore
    
    Areas of land and areas under water with a depth of less than
    five meters.primary distillation capacity
    
    At a given point in time, the maximum volume of crude oil a
    refinery is able to process in its basic distilling units.proved developed reserves
    
    Under the old SEC reserve rules, proved developed reserves are
    reserves that can be expected to be recovered through existing
    wells with existing equipment and operating methods. Additional
    oil and gas expected to be obtained through the application of
    fluid injection or other improved recovery techniques for
    supplementing the natural forces and mechanisms of primary
    recovery are included as proved developed reserves
    only after testing by a pilot project or after the operation of
    an installed program has confirmed through production response
    that increased recovery will be achieved.proved reserves
    
    Under the new SEC reserve rules, proved reserves are those
    quantities of oil and 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
    regulations  prior to the time at which contracts
    providing the right to operate expire, unless evidence indicates
    that renewal is reasonably certain, regardless of whether
    deterministic or probabilistic methods are used for the
    estimation. The project to extract the hydrocarbons must have
    commenced or the operator must be reasonably certain that it
    will commence the project within a reasonable time. 5




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(i) The area of the reservoir considered as proved includes:(A) The area identified by drilling and limited by fluid
    contacts, if any, and (B) Adjacent undrilled portions of
    the reservoir that can, with reasonable certainty, be judged to
    be continuous with it and to contain economically producible oil
    or gas on the basis of available geoscience and engineering data.(ii) In the absence of data on fluid contacts, proved
    quantities in a reservoir are limited by the lowest known
    hydrocarbons (LKH) as seen in a well penetration unless
    geoscience, engineering, or performance data and reliable
    technology establishes a lower contact with reasonable certainty.(iii) Where direct observation from well penetrations has
    defined a highest known oil (HKO) elevation and the potential
    exists for an associated gas cap, proved oil reserves may be
    assigned in the structurally higher portions of the reservoir
    only if geoscience, engineering, or performance data and
    reliable technology establish the higher contact with reasonable
    certainty.(iv) Reserves which can be produced economically through
    application of improved recovery techniques (including, but not
    limited to, fluid injection) are included in the proved
    classification when:(A) Successful testing by a pilot project in an area of the
    reservoir with properties no more favorable than in the
    reservoir as a whole, the operation of an installed program in
    the reservoir or an analogous reservoir, or other evidence using
    reliable technology establishes the reasonable certainty of the
    engineering analysis on which the project or program was based;
    and (B) The project has been approved for development by
    all necessary parties and entities, including governmental
    entities.(v) 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 prior to the ending date of the period covered by the
    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.Under the old SEC reserve rules, proved reserves are estimated
    quantities of crude oil and natural gas which geological and
    engineering data demonstrate with reasonable certainty to be
    recoverable in future years from known reservoirs under existing
    economic andoperating conditions, i.e., prices and costs as of the date the
    estimate is made. Prices include consideration of changes in
    existing prices provided only by contractual arrangements, but
    not of escalations based upon future conditions.proved undeveloped reserves
    
    Under the old SEC reserve rules, proved undeveloped reserves are
    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. Reserves on
    undrilled acreage shall be 6




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limited to those drilling units offsetting productive units that
    are reasonably certain of production when drilled. Proved
    reserves for other undrilled units can be claimed only where it
    can be demonstrated with certainty that there is continuity of
    production from the existing productive formation. Under no
    circumstances should estimates for proved undeveloped reserves
    be attributable to any acreage for which an application of fluid
    injection or other improved recovery technique is contemplated,
    unless such techniques have been proved effective by actual
    tests in the area and in the same reservoir.reserve-to-production
    ratio
    
    For any given well, field or country, the ratio of proved
    reserves to annual production of crude oil or, with respect to
    natural gas, to wellhead production excluding flared gas.sales gas
    
    Marketable production of gas on an as sold basis,
    excluding flared gas, injected gas and gas consumed in
    operations.undeveloped reserves
    
    Under the new SEC reserve rules, undeveloped reserves are
    reserves of any category 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.(i) Reserves on undrilled acreage shall be limited to those
    directly offsetting development spacing areas that are
    reasonably certain of production when drilled, unless evidence
    using reliable technology exists that establishes reasonable
    certainty of economic producibility at greater distances.(ii) Undrilled locations can be classified as having
    undeveloped reserves only if a development plan has been adopted
    indicating that they are scheduled to be drilled within five
    years, unless the specific circumstances, justify a longer time.(iii) Under no circumstances shall estimates for
    undeveloped reserves be attributable to any acreage for which an
    application of fluid injection or other improved recovery
    technique is contemplated, unless such techniques have been
    proved effective by actual projects in the same reservoir or an
    analogous reservoir, or by other evidence using reliable
    technology establishing reasonable certainty.water cut
    
    For a given oil region, the percentage that water constitutes of
    all fluids extracted from all wells in that region.    
    BOE is to
    barrels-of-oil
    equivalent;
    Mcf is to thousand cubic feet; and
    Bcf is to billion cubic feet. 7




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FORWARD-LOOKING
    STATEMENTS    
    the amounts and nature of future exploration, development and
    other capital expenditures;
    future prices and demand for crude oil, natural gas, refined
    products and chemical products;
    development projects;
    exploration prospects;
    reserves potential;
    production of oil and gas and refined and chemical products;
    development and drilling potential;
    expansion and other development trends of the oil and gas
    industry;
    the planned development of our natural gas operations;
    the planned expansion of our refined product marketing network;
    the planned expansion of our natural gas infrastructure;
    the anticipated benefit from the acquisition of certain overseas
    assets from CNPC, our parent company;
    the plan to continue to pursue attractive business opportunities
    outside China;
    our future overall business development and economic performance;
    our anticipated financial and operating information regarding,
    and the future development and economic performance of our
    business;
    our anticipated market risk exposure arising from future changes
    in interest rates, foreign exchange rates and commodity
    prices; and
    other prospects of our business and operations.      
    fluctuations in crude oil and natural gas prices;
    failure to achieve continued exploration success;
    failures or delays in achieving production from development
    projects;
    continued availability of capital and financing;
    acquisitions and other business opportunities that we may pursue;
    general economic, market and business conditions, including
    volatility in interest rates, changes in foreign exchange rates
    and volatility in commodity markets; 8




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
    liability for remedial actions under environmental regulations;
    the actions of competitors;
    wars and acts of terrorism or sabotage;
    changes in policies, laws or regulations of the PRC, including
    changes in applicable tax rates;
    the other changes in global economic and political conditions
    affecting the production, supply and demand and pricing of crude
    oil, refined products, petrochemical products and natural
    gas; and
    the other risk factors discussed in this annual report and other
    factors beyond our control.   PART I  ITEM 1 
    IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND
    ADVISORS    ITEM 2 
    OFFER STATISTICS AND EXPECTED TIMETABLE    ITEM 3 
    KEY INFORMATION Exchange
    Rates    Noon Buying
    Rate(1)High

Low(RMB per US$)November 2010


6.6892



6.6330December 2010


6.6745



6.6000January 2011


6.6364



6.5809February 2011


6.5965



6.5520March 2011


6.5743



6.5483April 2011


6.5477



6.4900May 2011 (ending as of May 6, 2011)


6.4955



6.4920     (1)
    
    The exchange rates reflect the noon buying rates as set forth in
    the H.10 statistical release of the Federal Reserve Board. 9




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Average
    Noon Buying
    Rates(1)
    Average NoonBuying Rate(RMB per US$)2006


7.95792007


7.58062008


6.91932009


6.82952010


6.7603     (1)
    
    For periods prior to January 1, 2009, the exchange rates
    reflect the noon buying rates as reported by the Federal Reserve
    Bank of New York. For periods after January 1, 2009, the
    exchange rates reflect the noon buying rates as set forth in the
    H.10 statistical release of the Federal Reserve Board.  Selected
    Financial Data  Historical
    Financial Information
    As at or For the Year Ended
    December 31,(1)2006

2007

2008

2009

2010RMB

RMB

RMB

RMB

RMB(In millions, except for per share and per ADS data)Turnover


691,448



837,542



1,072,604



1,019,275



1,465,415Total operating expenses


(491,424
)


(636,525
)


(913,033
)


(875,831
)


(1,277,638
)Profit from operations


200,024



201,017



159,571



143,444



187,777Profit before income tax expense


200,802



205,139



162,013



140,032



189,305Income tax expense


(50,615
)


(49,802
)


(35,211
)


(33,473
)


(38,513
)Profit for the year


150,187



155,337



126,802



106,559



150,792Profit for the year attributable to owners of the parent company


143,498



146,796



114,453



103,387



139,992Non-controlling interest


6,689



8,541



12,349



3,172



10,800Basic and diluted earnings per share for profit attributable to
    owners of the parent
    company(2)


0.80



0.82



0.63



0.56



0.76Basic and diluted net earnings per
    ADS(5)


80.16



81.69



62.54



56.49



76.49Total current assets


165,778



235,902



224,946



294,383



286,392Total non-current assets


714,509



833,709



971,289



1,155,905



1,370,095Total assets


880,287



1,069,611



1,196,235



1,450,288



1,656,487Total current liabilities


181,993



200,150



265,651



388,553



429,736 10




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As at or For the Year Ended
    December 31,(1)2006

2007

2008

2009

2010RMB

RMB

RMB

RMB

RMB(In millions, except for per share and per ADS data)Total non-current liabilities


75,675



86,742



82,744



154,034



216,622Total liabilities


257,668



286,892



348,395



542,587



646,358Equity attributable to owners of the parent company


590,414



738,246



790,910



847,223



938,926Non-controlling interest


32,205



44,473



56,930



60,478



71,203Total equity


622,619



782,719



847,840



907,701



1,010,129Other Financial DataDividend per share


0.36



0.36



0.28



0.25



0.34Dividend per ADS


35.75



36.25



28.14



25.42



34.42Capital expenditures


149,493



182,678



232,377



266,836



276,212Net cash flows from operating activities


202,701



207,633



172,465



261,972



310,686Net cash flows used for investing activities


(159,065
)


(183,656
)


(211,797
)


(261,453
)


(291,192
)Net cash flows from/used in financing activities


(75,385
)


(5,838
)


3,777



53,077



(60,944
)Net cash flows from operating activities per share
    (RMB)(3)


1.13



1.16



0.94



1.43



1.70Net cash flows from operating activities per ADS
    (RMB)(5)


113.23



115.56



94.23



143.14



169.75Net assets per share attributable to owners of the parent
    company
    (RMB)(4)


3.30



4.03



4.32



4.63



5.13Net assets per ADS attributable to owners of the parent company
    (RMB)(5)


329.80



403.37



432.14



462.91



513.02Return on net assets(%)


24.3



19.9



14.5



12.2



14.9     (1)
    
    Due to business combinations under common control completed in
    2008 and 2009, the relevant financial statements of the company
    have been restated in a manner identical to a pooling of
    interests to reflect the acquisitions.(2)
    
    As at December 31, 2006, basic and diluted earnings per
    share were calculated by dividing the net profit with the number
    of shares issued for this financial year of
    179.021 billion. As at December 31, 2007, basic and
    diluted earnings per share were calculated by dividing the net
    profit with the weighted average number of shares issued for
    this financial year of 179.700 billion. As at
    December 31, 2008, 2009 and 2010 respectively, basic and
    diluted earnings per share were calculated by dividing the net
    profit with the number of shares issued for each of these
    financial years of 183.021 billion.(3)
    
    As at December 31, 2006, cash flows from operating
    activities per share were calculated by dividing the cash flows
    from operating activities with the number of shares issued for
    this financial year of 179.021 billion. As at
    December 31, 2007, cash flows from operating activities per
    share were calculated by dividing the cash flows from operating
    activities with the weighted average number of shares issued for
    this financial year of 179.700 billion. As at
    December 31, 2008, 2009 and 2010 respectively, cash flows
    from operating activities per share were calculated by dividing
    the cash flows from operating activities with the number of
    shares issued for each of these financial years of
    183.021 billion.(4)
    
    As at December 31, 2006, net asset per share were
    calculated by dividing the shareholders equity with the
    number of shares issued for each of these financial years of
    179.021 billion. As at December 31, 2007, 2008, 2009
    and 2010 respectively, net asset per share was calculated by
    dividing the shareholders equity with the number of shares
    issued for each of these financial years of 183.021 billion.(5)
    
    Each ADS represents 100 H Shares. The basic and diluted earnings
    per ADS were calculated with the same method as that used for
    the calculation of the basic and diluted earnings per share. The
    cash flows from operating activities per ADS were calculated
    with the same method as that used for the calculation of the
    basic and diluted earnings per share. Net assets per ADS
    attributable to owners of the parent company per ADS were
    calculated with the same method as that used for the calculation
    of the net assets per share attributable to owners of the parent
    company. 11




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Risk
    Factors    Risks
    Related to Macro-economic Conditions
    Risks
    Related to Competition
      Risks
    Related to Governmental, Legal and Political Factors
  U.S.-based
   12




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Risks
    Related to Controlling Shareholder
    
    control our policies, management and affairs;
    subject to applicable PRC laws and regulations and provisions of
    our articles of association, affect the timing and amount of
    dividend payments and adopt amendments to certain of the
    provisions of our articles of association; and
    otherwise determine the outcome of most corporate actions and,
    subject to the regulatory requirements of the jurisdictions in
    which our shares are listed, cause our company to effect
    corporate transactions without the approval of minority
    shareholders.      Risks
    Related to Pricing and Exchange Rate
   13




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Risks
    Related to Environmental Protection and Hazards
        
    fires;
    explosions;
    spills; 14




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
    blow-outs; and
    other unexpected or dangerous conditions causing personal
    injuries or death, property damage, environmental damage and
    interruption of operations.        Risks
    Related to Oil and Gas Reserves
      Risks
    Related to New Construction or Expansion
    Risks
    Related to Effectiveness of Internal Control Over Financial
    Reporting
   15




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ITEM 4 
    INFORMATION
    ON THE COMPANY Introduction  History
    and Development of Our Company
  
              (86-10) 5998-6223.
   16




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Our
    Corporate Organization Structure
    
    (1)
    
    Indicates approximate shareholding.(2)
    
    Indicates approximate shareholding, including the 167,692,000 H
    Shares indirectly held by CNPC as of December 31, 2010
    through Fairy King Investments Limited, a wholly owned overseas
    subsidiary of CNPC.(3)
    
    Includes PetroChina Planning & Engineering Institute,
    PetroChina Exploration & Development Research
    Institute, IT Service Center, PetroChina Petrochemical Research
    Institute and several other companies.  Acquisitions
             17




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19




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Exploration
    and Production        Year Ended December 31,2008

2009

2010Revenue (RMB in millions)


626,367



405,326



544,884Income from operations (RMB in millions)


240,470



105,019



153,703Proved developed and undeveloped reservesCrude oil (million barrels)


11,221.3



11,262.6



11,277.7Natural gas (Bcf)


61,189.2



63,243.8



65,502.7ProductionCrude oil (million barrels)


870.7



843.5



857.7Natural gas for sale (Bcf)


1,864.2



2,112.2



2,221.2   Reserves
  barrels-of-oil barrels-of-oil barrels-of-oil barrels-of-oil
      Internal
    Controls Over Reserves Estimates
   20




---



##### Table of Contents



Third-Party
    Reserve Report
           21




---



##### Table of Contents



Crude Oil

Natural
    Gas(1)

Combined(1)(Millions of barrels)

(Bcf)

(BOE, in millions)Proved developed and undeveloped reservesReserves as of December 31, 2008


11,221.3



61,189.2



21,419.5Revisions of previous estimates


(192.6
)


(1,272.8
)


(404.6
)Extensions and discoveries


1,004.5



5,439.6



1,911.1Improved recovery


72.9



0



72.9Production for the year


(843.5
)


(2,112.2
)


(1,195.7
)Reserves as of December 31, 2009


11,262.6



63,243.8



21,803.2Revisions of previous estimates


(77.8
)


(1,455.8
)


(320.3
)Extensions and discoveries


876.9



5,935.9



1,866.2Improved recovery


73.7



0



73.7Production for the year


(857.7
)


(2,221.2
)


(1,228.0
)Reserves as of December 31, 2010


11,277.7



65,502.7



22,194.8Proved developed reservesAs of December 31, 2008


8,324.1



26,666.8



12,768.6As of December 31, 2009


7,870.8



30,948.8



13,028.9As of December 31, 2010


7,605.4



31,102.4



12,789.1Proved undeveloped reservesAs of December 31, 2008


2,897.2



34,522.4



8,650.9As of December 31, 2009


3,391.8



32,295.0



8,774.3As of December 31, 2010


3,672.3



34,400.3



9,405.7     (1)
    
    Represents natural gas remaining after field separation for
    condensate removal and reduction for flared gas.      As of December 31,2008

2009

2010Proved



Proved



ProvedDeveloped



Developed



Developedand

Proved

and

Proved

and

ProvedUndeveloped

Developed

Undeveloped

Developed

Undeveloped

Developed(Millions of barrels)Crude oil reservesDaqing


3,548.0



2,912.0



3,463.4



2,740.8



3,178.1



2,533.4Changqing


1,624.5



1,256.7



1,783.8



1,298.8



1,946.8



1,310.5Xinjiang


1,302.6



1,106.6



1,395.1



1,117.6



1,418.6



1,109.6 22




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##### Table of Contents



As of December 31,2008

2009

2010Proved



Proved



ProvedDeveloped



Developed



Developedand

Proved

and

Proved

and

ProvedUndeveloped

Developed

Undeveloped

Developed

Undeveloped

Developed(Millions of barrels)Other
    regions(1)


4,746.2



3,048.8



4,620.3



2,713.6



4,734.2



2,651.9Total


11,221.3



8,324.1



11,262.6



7,870.8



11,277.7



7,605.4   As of December 31,2008

2009

2010Proved



Proved



ProvedDeveloped



Developed



Developedand

Proved

and

Proved

and

ProvedUndeveloped

Developed

Undeveloped

Developed

Undeveloped

Developed(Bcf)Natural gas
    reserves(2)Changqing


19,261.7



6,901.6



20,363.2



9,884.4



21,244.4



10,853.4Tarim


15,516.4



7,722.7



16,892.1



7,758.3



19,147.7



7,822.9Sichuan


11,285.4



4,030.4



11,177.3



4,219.0



10,512.5



2,814.8Other
    regions(1)


15,125.7



8,012.1



14,811.2



9,087.1



14,598.1



9,611.3Total


61,189.2



26,666.8



63,243.8



30,948.8



65,502.7



31,102.4     (1)
    
    Represents other oil regions in China and our overseas oil and
    gas fields as a result of our acquisition of overseas assets.(2)
    
    Represents natural gas remaining after field separation for
    condensate removal and reduction for flared gas.  Exploration
    and Development
      Year



Daqing

Xinjiang

Changqing

Others(1)

Total2008


Net exploratory wells
    drilled(2)


234



162



583



669



1,648Crude oil


71



72



207



287



637Natural gas


1



15



26



50



92Dry(3)


162



75



350



332



919Net development wells
    drilled(2)


4,238



1,887



5,079



3,996



15,200Crude oil


4,223



1,868



4,469



3,487



14,047Natural gas


4



18



528



456



1,006Dry(3)


11



1



82



53



1472009


Net exploratory wells
    drilled(2)


533



218



1,019



1,065



2,835Crude oil


297



140



540



481



1,458Natural gas


9



9



148



170



336Dry(3)


227



69



331



414



1,041Net development wells
    drilled(2)


4,934



681



7,421



2,238



15,274Crude oil


4,923



674



6,808



1,626



14,031Natural gas


1



7



480



584



1,072Dry(3)


10



0



133



28



1712010


Net exploratory wells
    drilled(2)


157



169



680



634



1,640Crude oil


146



131



431



342



1,050Natural gas


1



1



100



61



163 23




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##### Table of Contents



Year



Daqing

Xinjiang

Changqing

Others(1)

TotalDry(3)


10



37



149



231



427Net development wells
    drilled(2)


5,073



1,323



7,754



3,477



17,627Crude oil


5,024



1,312



7,106



3,083



16,525Natural gas


27



11



542



348



928Dry(3)


22



0



106



46



174     (1)
    
    Represents the Liaohe, Jilin, Huabei, Dagang, Sichuan, Tarim,
    Tuha, Qinghai, Jidong, Yumen and other oil regions.(2)
    
    Net wells refer to the wells after deducting
    interests of others. No third parties own any interests in any
    of our wells.(3)
    
    Dry wells are wells with insufficient reserves to
    sustain commercial production.    Oil-and-Gas
    Properties
    Productive
    Wells(1)

Acreage(1)Natural

Developed

UndevelopedOil Region

Crude Oil

Gas

Crude Oil

Natural Gas

Crude Oil

Natural Gas(Thousands of acres)Daqing


56,819



212



907.6



86.4



779.7



111.5Changqing


32,923



4,722



636.0



2,428.7



434.0



2,558.4Xinjiang


22,940



139



309.4



57.7



158.7



21.5Other
    regions(2)


59,585



3,832



1,350.0



763.6



750.0



908.8Total


172,267



8,905



3,203.0



3,336.4



2,122.4



3,600.2     (1)
    
    Includes all wells and acreage in which we have an interest. No
    third parties own any interests in any of our wells or acreage.(2)
    
    Represents the Liaohe, Jilin, Huabei, Dagang, Sichuan, Tarim,
    Tuha, Qinghai, Jidong and Yumen and other oil regions.  Production
    For the Year EndedDecember 31,

% of2008

2009

2010

2010 TotalCrude oil
    production(1)(thousands of barrels per day, except percentages or otherwise
    indicated)Daqing


813.2



806.2



805.6



34.3Changqing


279.8



318.1



369.3



15.7Xinjiang


246.9



220.5



220.5



9.4Other(2)


1,039.1



966.2



954.3



40.6Total


2,379.0



2,311.0



2,349.7



100Annual production (million barrels)


870.7



843.5



857.7Average sales price (US$ per barrel)


87.55



53.90



72.93 24




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##### Table of Contents



For the Year EndedDecember 31,

% of2008

2009

2010

2010 TotalNatural gas
    production(1)(3)(millions of cubic feet per day, except percentages or otherwise
    indicated)Tarim


1,564.1



1,650.3



1,674.2



27.5Changqing


1,024.5



1,434.1



1,579.8



26.0Sichuan


1,364.6



1,381.4



1,387.2



22.8Other(4)


1,140.1



1,320.9



1,444.2



23.7Total


5,093.3



5,786.7



6,085.4



100Annual production (Bcf)


1,864.2



2,112.2



2,221.2Average sales price (US$ per Mcf)


4.72



4.78



5.54     (1)
    
    Production volumes for each region include our share of the
    production from all of our cooperative projects with foreign
    companies in that region.(2)
    
    Represents production from the Liaohe, Jilin, Huabei, Dagang,
    Tarim, Tuha, Qinghai, Jidong, Yumen and other oil regions and
    our share of overseas production as a result of our acquisition
    of overseas assets.(3)
    
    Represents production of natural gas for sale.(4)
    
    Represents production from the Daqing, Qinghai, Tuha, Xinjiang,
    Liaohe, Huabei, Dagang, Jilin, Jidong, Yumen and other oil and
    gas regions and our share of overseas production as a result of
    our acquisition of overseas assets.    Principal
    Oil and Gas Regions
  Daqing
    Oil Region
    reserve-to-production
     25




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##### Table of Contents



Xinjiang
    Oil Region
    reserve-to-production
  Sichuan
    Gas Region
  reserve-to-production
      Changqing
    Oil and Gas Region
  reserve-to-production
    Tarim
    Oil and Gas Region
     26




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##### Table of Contents



27




---



##### Table of Contents



Refining
    and Chemicals      Year Ended December 31,2008

2009

2010Revenue (RMB in millions)


560,729



501,300



664,773Income/(loss) from operations (RMB in millions)


(93,830
)


17,308



7,847Crude oil processed (million barrels)


849.8



828.6



903.9Crude oil primary distillation capacity (million barrels/year)


941.7



975



1,082.9Production of refined oil products (thousand tons)


73,968



73,195



79,448   Refining
  Refined
    Products
    Year Ended December 31,Principal Product

2008

2009

2010(Thousand tons)Diesel


48,294



48,828



53,745Gasoline


23,465



22,114



23,308Kerosene


2,209



2,253



2,395Lubricants


1,768



1,401



1,607Fuel oil


4,077



3,057



4,131Naphtha


7,226



8,041



10,016   Our
    Refineries
  and/or
 28




---



##### Table of Contents



As of December 31,2008

2009

2010Primary distillation
    capacity(1)

    (thousand barrels per day)Lanzhou Petrochemical


212.6



212.6



212.6Dalian Petrochemical


415.0



415.0



415.0Fushun Petrochemical


186.2



236.9



236.9Dushanzi Petrochemical


121.5



202.4



202.4Other refineries


1,644.8



1,604.3



1,899.8Total


2,580.1



2,671.2



2,966.7Refining throughput(thousand barrels per day)Lanzhou Petrochemical


202.3



211.6



209.3Dalian Petrochemical


267.2



281.5



331.1Fushun Petrochemical


193.1



187.9



181.9Dushanzi Petrochemical


90.0



120.9



176.8Other refineries


1,569.4



1,468.3



1,577.3Total


2,322.0



2,270.2



2,476.4     (1)
    
    Represents the primary distillation capacity of crude oil and
    condensate.        Chemicals
   29




---



##### Table of Contents



Our
    Chemical Products
    Year Ended December 31,2008

2009

2010(Thousand tons)Basic petrochemicalsPropylene


3,152



3,278



3,491Ethylene


2,676



2,989



3,615Benzene


944



1,022



1,247Derivative petrochemicalsSynthetic resin


4,100



4,480



5,550Other synthetic fiber raw materials and polymer


1,637



1,471



1,985Synthetic rubber


344



420



619Other chemicalsUrea


3,824



3,973



3,764       Marketing
    of Chemicals
   30




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##### Table of Contents



Year Ended December 31,Product

2008

2009

2010(Thousand tons)Derivative petrochemicalsSynthetic resin


4,114.7



4,458.3



5,431.4Synthetic fiber


118.4



135.2



140.5Synthetic rubber


371.4



492.0



628.6Intermediates


6,154.6



4,933.6



5,109.7Other chemicalsUrea


4,393.2



4,054.1



3,445.0    31




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##### Table of Contents



32




---



##### Table of Contents



Marketing      Year Ended December 31,2008

2009

2010Revenue (RMB in millions)


778,141



768,295



1,134,534Income from operations (RMB in millions)


7,982



13,265



15,956External sales volume of refined oil products (thousand tons)


90,278



101,253



120,833     
    Approximately 837 regional wholesale distribution outlets
    nationwide. Substantially all of these outlets are located in
    high demand areas such as economic centers across China,
    particularly in the coastal areas, along major railways and
    along the Yangtze River; and
    17,996 service stations, consisting of 17,394 service stations
    owned and operated by us and 602 franchise service stations
    owned and operated by third parties.      Year Ended December 31,Product

2008

2009

2010(Thousand tons)Diesel


56,081



64,659



77,789Gasoline


29,399



30,777



36,328Kerosene


4,798



5,817



6,716Lubricants


2,003



1,796



1,703   Wholesale
    Marketing
    Retail
    Marketing
     33




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##### Table of Contents



34




---



##### Table of Contents



Natural
    Gas and Pipeline      As of December 31 or YearEnded December 31,2008

2009

2010Revenue (RMB in millions)


63,315



77,658



117,043Income from operations (RMB in millions)


16,057



19,046



20,415Total length of natural gas pipelines (km)


24,037



28,595



32,801Total length of crude oil pipeline (km)


11,028



13,164



14,782Total length of refined oil products pipeline (km)


2,656



8,868



9,257Total volume of natural gas
    sold(1)

    (Bcf)


1,802.8



2,105.1



2,225.2     (1)
    
    Represents the natural gas sold to third parties  Our
    Principal Markets for Natural Gas
             35




---



##### Table of Contents



Natural
    Gas Transmission Infrastructure
    The
    First
    West-East
    Gas Pipeline
  West-East West-East West-East West-East take-or-pay West-East
  The
    Second
    West-East
    Gas Pipeline
  West-East West-East West-East West-East
    Crude Oil
    Transportation and Storage Infrastructure
      
    14,782 kilometers of crude oil pipelines; and
    crude oil storage facilities with an aggregate storage capacity
    of approximately 28.3 million cubic meters.  Russia
    to China Crude Oil Pipeline
     36




---



##### Table of Contents



Refined
    Product Transportation and Storage Infrastructure
    
    9,257 kilometers of refined product pipelines; and
    refined product storage facilities with a total storage capacity
    of approximately 29.1 million cubic meters.  The
    Lanzhou to Zhengzhou to Changsha Pipeline
       Competition    Exploration
    and Production Operations
    Refining
    and Chemicals Operations and Marketing Operations
     37




---



##### Table of Contents



Natural
    Gas and Pipeline Operations
   Environmental
    Matters    
    require an environmental evaluation report to be submitted and
    approved prior to the commencement of exploration, production,
    refining and chemical projects;
    restrict the type, quantities, and concentration of various
    substances that can be released into the environment in
    connection with drilling and production activities;
    limit or prohibit drilling activities within protected areas and
    certain other areas; and
    impose penalties for pollution resulting from oil, natural gas
    and petrochemical operations, including criminal and civil
    liabilities for serious pollution.     38




---



##### Table of Contents




    building environment-friendly projects;
    reducing sulphur levels in gasoline and diesel fuel;
    reducing paraffin and benzene content in gasoline, and
    continuously reducing the quantity of emissions and effluents
    from our refineries and petrochemical plants; and
    developing and installing monitoring systems at our pollutant
    discharge openings and developing environmental impact
    assessments for construction projects.      
    providing each household in areas surrounding our production
    facilities with printed materials to explain and illustrate
    safety and protection knowledge and skills; and
    enhancing the implementation of various effective safety
    production measures we have adopted previously.   Legal
    Proceedings   Properties    
    CNPC would use its best endeavors to obtain formal land use
    right licenses to replace the entitlement certificates in
    relation to the 28,649 parcels of land, which were leased or
    transferred to us from CNPC, within one year from August,
    September and October 1999 when the relevant entitlement
    certificates were issued;
    CNPC would complete, within one year from November 5, 1999,
    the necessary governmental procedures for the requisition of the
    collectively owned land on which 116 service stations owned by
    us are located; and
    CNPC would obtain individual building ownership certificates in
    our name for all of the 57,482 buildings transferred to us by
    CNPC, before November 5, 2000.   39




---



##### Table of Contents



Intellectual
    Property  
   Regulatory
    Matters  Overview
    
    The Ministry of Land and Resources has the authority for
    granting, examining and approving oil and gas exploration and
    production licenses, the administration of registration and
    transfer of exploration and production licenses.
    The Ministry of Commerce:  
    grants the import and export volume quotas for crude oil and
    refined products in accordance with the market supply and demand
    in China as well as the WTO requirements for China;
    issues import and export licenses for crude oil and refined
    products to oil and gas companies that have obtained import and
    export quotas; and
    examines and approves production sharing contracts and
    Sino-foreign equity and cooperative joint venture contracts.  
    The National Development and Reform Commission:  
    has the authority for industry administration, industry policy
    and policy coordination over Chinas oil and gas industry;
    determines mandatory minimum volumes and applicable prices of
    natural gas to be supplied to certain fertilizer producers;
    publishes guidance prices for natural gas and retail highest
    guidance prices for certain refined products, including gasoline
    and diesel;
    formulates the plan for aggregate import and export volume of
    crude oil and refined products in accordance with the market
    supply and demand in China;
    approves significant petroleum, natural gas, oil refinery and
    chemical projects set forth under the Catalogues of Investment
    Projects Approved by the Central Government; and
    approves Sino-foreign equity and cooperative projects exceeding
    certain capital amounts. 40




---



##### Table of Contents



Exploration
    Licenses and Production Licenses
          Pricing
  Crude
    Oil
    Refined
    Products
   41




---



##### Table of Contents



Measures for
    Administration of Petroleum Price
  Chemical
    Products
    Natural
    Gas
       42




---



##### Table of Contents



Production
    and Marketing
  Crude
    Oil
    Refined
    Products
    Natural
    Gas
   43




---



##### Table of Contents



Foreign
    Investments
  Cooperation
    in Exploration and Production with Foreign
    Companies
        Transportation
    and Refining
    Import
    and Export
    Capital
    Investment and Financing
             44




---



##### Table of Contents



Taxation,
    Fees and Royalty
    Tax Item

Tax Base

Tax RateEnterprise income tax

Taxable income

Effective January 1, 2008, charged at the legal rate of 25%.
    However, certain of our qualified operations in west regions of
    the PRC were still entitled to a rate of 15% up to December 31,
    2010.Value-added tax

Turnover

13% for liquified natural gas, natural gas, liquified petroleum
    gas, agricultural film and fertilizers and 17% for other items.Business tax

Income from transportation services

3%Consumption tax

Aggregate volume sold or self-consumed

Effective January 1, 2009, the unit tax amount of the
    consumption tax for refined oil products was increased as
    follows:RMB1.0 per liter for unleaded gasoline.RMB0.8 per liter for diesel.RMB1.0 per liter for naphtha, solvent naphtha and lubricants.RMB0.8 per liter for fuel oil.Resource tax

Aggregate volume sold or
    self-
    consumed/Aggregated value sold

Effective July 1, 2005, resource tax applicable to crude oil of
    our company was adjusted upward from the original RMB8 to 30 per
    ton to RMB14 to 30 per ton, and the resource tax for natural gas
    was adjusted from the original RMB2 to 15 per thousand cubic
    meter to RMB7 to 15 per thousand cubic meter.Effective June 1, 2010, the resource tax payable by the resource
    tax payers in connection with their extraction of crude oil and
    natural gas in Xinjiang shall be collected based on value at the
    rate of 5%. Taxpayers shall be eligible for a reduced resource
    tax rate in connection with their extraction of viscous oil,
    high pour-point oil, and high sour natural gas as well as
    enhanced oil recovery.  As of December 1, 2010, twelve provinces
    and regions in western China began to implement these new
    resource tax provisions.The actual applicable rate for each oil field may differ,
    depending on the resource differences, volume of the exploration
    and production activities and costs required for the production
    at the particular oil field. 45




---



##### Table of Contents



Tax Item

Tax Base

Tax RateThe actual applicable rate for each oil field may differ,
    depending on the resource differences, volume of the exploration
    and production activities and costs required for the production
    at the particular oil field.Compensatory fee for mineral resources

Turnover

1% for crude oil and natural gasCrude oil special gain levy

Sales amount above specific threshold

Effective March 26, 2006, levied on the domestic crude oil sold
    at or above US$40/barrel, with a five-level progressive tax
    rates, varying from 20% to 40%Exploration license fee

Area

RMB100 to 500 per square kilometer per yearProduction license fee

Area

RMB1,000 per square kilometer per yearRoyalty
    fee(1)

Production volume

Progressive rate of 0-12.5% for crude oil and 0-3% for natural
    gas     (1)
    
    Payable only by Sino-foreign oil and gas exploration and
    development cooperative projects. The project entity of those
    cooperative projects is not subject to any other resource tax or
    fee.  Circular on Implementing
    the Reform of Refined Oil Product Pricing and Relevant Tax and
    Charge Collection
  Environmental
    Regulations
     46




---



##### Table of Contents



ITEM 4A 
    UNRESOLVED
    STAFF COMMENTS    ITEM 5 
    OPERATING
    AND FINANCIAL REVIEW AND PROSPECTS General    Overview
    
    the exploration, development, production and sale of crude oil
    and natural gas;
    the refining of crude oil and petroleum products, and the
    production and marketing of basic petrochemical products,
    derivative chemical products and other chemical products;
    marketing and trading of refined oil products; and
    the transmission of natural gas, crude oil and refined oil
    products as well as the sale of natural gas.    Factors
    Affecting Results of Operations
  period-to-period
  Prices
    of Principal Products
      2008

2009

2010Crude oil (US$/barrel)


87.55



53.90



72.93Natural gas (US$/thousand cubic feet)


4.72



4.78



5.54Gasoline (US$/barrel)


99.62



99.25



115.17Kerosene (US$/barrel)


115.83



72.20



91.14Diesel (US$/barrel)


106.09



96.91



116.41   Production
    and Sales Volume for Oil and Gas Products
   47




---



##### Table of Contents



Regulatory
    Environment
    Critical
    Accounting Policies
    Accounting
    for Oil and Gas Exploration and Production
    Activities
    Oil
    and Gas Reserves
     48




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##### Table of Contents



Property,
    Plant and Equipment
        Buildings and plant

8-40 yearsEquipment and machinery

4-30 yearsMotor vehicles

4-14 yearsOther

5-12 years            49




---



##### Table of Contents



Provision
    for Asset Decommissioning
   Operating
    Results      Year Ended December 31,2008

2009

2010(RMB in millions)Turnover


1,072,604



1,019,275



1,465,415Operating expenses


(913,033
)


(875,831
)


(1,277,638
)Profit from operations


159,571



143,444



187,777Exchange gain (loss), net


(1,081
)


(783
)


(1,172
)Interest expense, net


(767
)


(3,813
)


(4,338
)Share of profit of affiliates and jointly controlled entities


4,290



1,184



7,038Profit before income tax expense


162,013



140,032



189,305Income tax expense


(35,211
)


(33,473
)


(38,513
)Profit for the year attributable to non-controlling interest


(12,349
)


(3,172
)


(10,800
)Profit for the year attributable to owners of the company


114,453



103,387



139,992     2009



2010vs.



vs.2008

2009

2008

2010

2009(RMB in millions, except percentages)TurnoverExploration and production


626,367



405,326



(35.3
%)


544,884



34.4
%Refining and chemicals


560,729



501,300



(10.6
%)


664,773



32.6
%Marketing


778,141



768,295



(1.3
%)


1,134,534



47.7
%Natural gas and pipeline


63,315



77,658



22.7
%


117,043



50.7
%Other


1,418



1,372



(3.2
%)


1,606



17.1
%Total


2,029,970



1,753,951



(13.6
%)


2,462,840



40.4
%Less intersegment sales


(957,366
)


(734,676
)


(23.3
%)


(997,425
)


35.8
%Consolidated net sales from operations


1,072,604



1,019,275



(5.0
%)


1,465,415



43.8
%  50




---



##### Table of Contents



2009



2010vs.



vs.2008

2009

2008

2010

2009(RMB in millions, except percentages)Profit (loss) from operationsExploration and production


240,470



105,019



(56.3
%)


153,703



46.4
%Refining and chemicals


(93,830
)


17,308







7,847



(54.7
%)Marketing


7,982



13,265



66.2
%


15,956



20.3
%Natural gas and pipeline


16,057



19,046



18.6
%


20,415



7.2
%Other


(11,108
)


(11,194
)






(10,144
)


Total


159,571



143,444



(10.1
%)


187,777



30.9
%   Year
    Ended December 31, 2010 Compared to Year Ended
    December 31, 2009
  Consolidated
    Results of Operations
  Overview
    Turnover.
  Sales Volume (thousand tons)

Average Realized Price (RMB per ton)Percentage of





Percentage of2010

2009

Change (%)

2010

2009

Change (%)Crude oil*


61,629



53,768



14.6



3,623



2,750



31.7Natural gas (million cubic meter, RMB/000 cubic meter)


63,011



59,614



5.7



955



814



17.3Gasoline


36,328



30,777



18.0



6,627



5,763



15.0Diesel


77,789



64,659



20.3



5,910



4,965



19.0Kerosene


6,716



5,817



15.5



4,874



3,896



25.1Heavy oil


9,603



8,472



13.3



3,800



2,903



30.9Polyethylene


3,012



2,349



28.2



8,958



8,430



6.3Lubricant


1,703



1,796



(5.2
)


8,215



7,204



14.0     *
    
    represents all the external sales volume of crude oil of the
    company. 51




---



##### Table of Contents



Operating Expenses.
  Purchases, Services and
    Others.
  Employee Compensation Costs.
  Exploration Expenses.
  Depreciation, Depletion and
    Amortization.
  Selling, General and Administrative
    Expenses.
  Taxes other than Income Taxes.
  Other Expenses, net.
  Profit from Operations.
  Net Exchange Loss.
  Net Interest Expenses.
 52




---



##### Table of Contents



Profit Before Taxation.
  Income Tax Expenses.
  Profit for the year.
  Profit attributable to non-controlling interest of the
    company.
  Net profit attributable to owners of the
    company.
  Exploration
    and Production
  Turnover.
  Operating Expenses.
  Profit from Operations.
  Refining
    and Chemicals
  Turnover.
  Operating Expenses.
  Profit/loss from Operations.
  Marketing
  Turnover.
 53




---



##### Table of Contents



Operating Expenses.
  Profit from Operations.
  Natural
    Gas and Pipeline
  Turnover.
  Operating Expenses.
  Profit from Operations.
  Year
    Ended December 31, 2009 Compared to Year Ended
    December 31, 2008
  Consolidated
    Results of Operations
  Overview
    Turnover.
 54




---



##### Table of Contents



Sales Volume (thousand tons)

Average Realized Price (RMB/ton)Percentage of





Percentage of2009

2008

Change (%)

2009

2008

Change (%)Crude oil*


53,768



38,603



39.3



2,750



4,348



(36.8
)Natural gas (million cubic metre,
    RMB/000 cubic metre)


59,614



51,054



16.8



814



813



0.1Gasoline


30,777



29,399



4.7



5,763



5,881



(2.0
)Diesel


64,659



56,081



15.3



4,965



5,526



(10.2
)Kerosene


5,817



4,798



21.2



3,896



6,355



(38.7
)Heavy oil


8,472



7,061



20.0



2,903



3,541



(18.0
)Polyethylene


2,349



2,195



7.0



8,430



10,219



(17.5
)Lubricant


1,796



2,003



(10.3
)


7,204



7,515



(4.1
)     *
    
    The crude oil listed above represents all the external sales
    volume of crude oil of the company.  Operating Expenses.
  Purchases, Services and Other
    Expenses.
  Employee Compensation Costs.
  Exploration Expenses.
  Depreciation, Depletion and
    Amortization.
  Selling, General and Administrative
    Expenses.
  Taxes Other than Income Taxes.
 55




---



##### Table of Contents



Other (Expenses)/Incomes, net.
  Profit from Operations.
  Net Exchange Loss.
  Net Interest Expenses.
  Profit before Income Tax
    Expense.
  Income Tax Expense.
  Profit for the Year.
  Profit Attributable to Non-controlling Interest of the
    Company.
  Profit Attributable to Owners of the
    Company.
  Exploration
    and Production
  Turnover.
  Operating Expenses.
  Profit from Operations.
 56




---



##### Table of Contents



Refining
    and Chemicals
  Turnover.
  Operating Expenses.
  Profit/Loss from Operations.
  Marketing
  Turnover.
  Operating Expenses.
  Profit from Operations.
  Natural
    Gas and Pipeline
  Turnover.
  Operating Expenses.
  Profit from Operations.
 Liquidity
    and Capital Resources     57




---



##### Table of Contents



Year Ended December 31,2008

2009

2010(RMB in millions)Net cash flows from operating activities


172,465



261,972



310,686Net cash flows used for investing activities


(211,797
)


(261,453
)


(291,192
)Net cash flows from/(used) financing activities


3,777



53,077



(60,944
)Currency translation difference


(112
)


179



234Cash and cash equivalents at year end


33,150



86,925



45,709     Net Cash
    Flows from Operating Activities
   58




---



##### Table of Contents



Net Cash
    Flows Used for Investing Activities
      Net Cash
    Flows From/(Used) Financing Activities
        December 31,2008

2009

2010(RMB in millions)Short-term debt (including current portion of long-term debt)


93,670



148,851



102,268Long-term debt


32,852



85,471



131,352Total debt


126,522



234,322



233,620Less:Cash and cash equivalents


33,150



86,925



45,709Net debt


93,372



147,397



187,911      59




---



##### Table of Contents



Capital
    Expenditures and Investments
      20112008

2009

2010

Anticipated(RMB in



(RMB in



(RMB in



(RMB inmillions)

%

millions)

%

millions)

%

millions)

%Exploration and
    production(1)


157,194



67.6



129,017



48.4



160,893



58.3



171,800



53.7Refining and chemicals


30,619



13.2



42,558



15.9



44,242



16.0



48,000



15.0Marketing


4,974



2.1



18,174



6.8



15,793



5.7



19,900



6.2Natural gas and pipeline


36,848



15.9



74,754



28.0



53,648



19.4



77,300



24.2Others


2,742



1.2



2,333



0.9



1,636



0.6



3,000



0.9Total


232,377



100.0



266,836
(2)


100.0



276,212



100.0



320,000



100.0     (1)
    
    If investments related to geological and geophysical exploration
    costs are included, the capital expenditures and investments for
    the exploration and production segment for 2009 and 2010, and
    the estimates for the same in 2011 would be
    RMB138,396 million, RMB173,142 million and
    RMB184,800 million, respectively.(2)
    
    The capital expenditure for 2009 has excluded the consideration
    for the acquisition of Singapore Petroleum Company Limited in
    the amount of Singapore dollars
    (S$)3,239 million (approximately
    RMB15,296 million).    Exploration
    and Production
     60




---



##### Table of Contents



Refining
    and Chemicals
      Marketing
      Natural
    Gas and Pipeline
      Others
     61




---



##### Table of Contents



Off-Balance
    Sheet Arrangements   Long-Term
    Contractual Obligations and Other Commercial
    Commitments and Payment Obligations      Payment Due by PeriodLess Than





AfterContractual Obligations

Total

1 Year

1-3 Years

3-5 Years

5 Years(RMB in millions)Long-term debt


136,445



5,093



48,084



62,644



20,624Capital lease obligations


















Operating leases


94,842



4,118



6,765



6,407



77,552Capital commitments


49,495



42,774



6,721







Unconditional purchase obligations


2,631



1,328



1,212



42



49Other long-term obligations


















Debt-related interest


24,068



4,605



7,924



5,521



6,018Total contractual cash obligations


307,481



57,918



70,706



74,614



104,243     Year

Annual Payment(RMB in millions)2011


1,0002012


1,0002013


1,0002014


1,0002015


1,000   Assets
    Retirement Obligation
   Research
    and Development   62




---



##### Table of Contents



Exploration
    and Production
    
    theories and technologies of crude oil and natural gas
    exploration;
    oil and gas development and surface engineering technology;
    oil and gas production and pipeline transportation; and
    security, energy conservation and environment protection.  Refining
    and Chemicals
    
    technology for clean refined oil products;
    core technology for heavy oil processing;
    technology for developing high quality and high value synthetic
    resin products;
    high performance synthetic rubber products;
    production technology for low cost chemical raw
    materials; and
    integration of the informationization technology and refinery
    business. Trend
    Information     Other
    Information  Inflation
   63




---



##### Table of Contents



Related
    Party Transactions
    Recent
    Developments in IFRS
    ITEM 6 
    DIRECTORS,
    SENIOR MANAGEMENT AND EMPLOYEES Directors,
    Senior Management and Supervisors  his/her
  
    convening shareholders meetings and reporting its work to
    the shareholders meetings;
    implementing the resolutions of the shareholders meetings;
    determining our business plans and investment plans;
    formulating our annual budget and final accounts;
    formulating our profit distribution proposal and loss recovery
    proposals;
    formulating proposals for the increase or reduction of our
    registered capital and the issuance of our debentures or other
    securities and listings;
    formulating proposals for any amendment of our articles of
    association;
    deciding on our internal management structure and formulate our
    basic management system;
    Managing the information disclosures of our company and other
    matters relating to communications with the
    shareholders; and
    exercising any other powers and duties conferred by the
    shareholders at general meetings and set forth in our articles
    of association.    his/her
    
    to review the periodic reports prepared by the board of
    directors and issue written opinions in connection with such
    review;
    to review the companys financial position; 64




---



##### Table of Contents




    to oversee the performance of duties by the directors, the
    president, senior vice presidents, vice presidents, the chief
    financial officer and other senior officers of the company and
    to propose the removal of any of the foregoing persons who acts
    in contravention of any law, regulation, the companys
    articles of association or any resolutions of the
    shareholders meeting;
    to demand any director, the president, senior vice president,
    vice president, the chief financial officer or any other senior
    officer who acts in a manner which is harmful to the
    companys interest to rectify such behavior;
    to check the financial information such as the financial report,
    business report and plans for distribution of profits to be
    submitted by the board of directors to the shareholders
    meetings and to authorize, in the companys name, publicly
    certified and practicing auditors to assist in the
    re-examination of such information should any doubt arise in
    respect thereof;
    to propose the convening of an extraordinary shareholders
    meeting, and convene and preside over a shareholders
    meeting when the board fails to perform its duties to do so as
    set forth in the PRC Company Law;
    to submit proposals to the shareholders meetings;
    to confer with any director, or initiate legal proceedings on
    behalf of the company against any director, the president,
    senior vice president, vice president, the chief financial
    officer or any other senior officer in accordance with
    Article 152 of the PRC Company Law
    to initiate investigations upon being aware of any extraordinary
    development in the operational conditions of the company;
    together with the audit committee of the board, reviewing and
    supervising the engagement and work of external auditors,
    including evaluating the performance of external auditors
    annually and raising proposals to the shareholders
    meetings with respect to the engagement, re-engagement and
    dismissal of external auditors and the compensation of such
    external auditors;
    to supervise the legal compliance of the related-party
    transactions; and
    other functions and powers as set forth in the articles of
    association of the company.       65




---



##### Table of Contents



Name

Age

Position

Date of
    Election(1)Jiang Jiemin


55


Chairman of the board of directors

May 15, 2008Zhou Jiping


58


Vice Chairman of the board of directors and president

May 15, 2008Wang
    Yilin(2)


54


Director

May 15, 2008Zeng Yukang


60


Director

May 15, 2008Wang Fucheng


60


Director

May 15, 2008Li Xinhua


57


Director

May 15, 2008Liao Yongyuan


48


Director and vice president

May 15, 2008Wang Guoliang


58


Director

May 15, 2008Jiang Fan


47


Director

May 15, 2008Chee-Chen Tung


68


Independent non-executive director

May 15, 2008Liu Hongru


80


Independent non-executive director

May 15, 2008Franco Bernabè


62


Independent non-executive director

May 15, 2008Li Yongwu


66


Independent non-executive director

May 15, 2008Cui Junhui


64


Independent non-executive director

May 15, 2008Li Hualin


48


Vice President and Secretary to the board of directorsSun Longde


48


Vice presidentShen Diancheng


51


Vice presidentLiu Hongbin


47


Vice presidentZhou Mingchun


43


Chief financial officerZhao Zhengzhang


54


Vice presidentBo Qiliang


48


Vice presidentSun Bo


50


Vice presidentLin Aiguo


52


Chief engineerWang Daofu


55


Chief geologistHuang Weihe


53


Chief engineerChen Ming


60


Chairman of the supervisory boardWen Qingshan


52


SupervisorSun Xianfeng


58


SupervisorYu Yibo


47


SupervisorWang Yawei


56


SupervisorQin Gang


57


SupervisorWang Shali


56


SupervisorLi Yuan


63


Independent supervisorWang Daocheng


70


Independent supervisor     (1)
    
    For directors only; and(2)
    
    On April 15, 2011, Mr. Wang Yilin resigned as a
    director of our company with immediate effect.  Directors
  Jiang Jiemin,
 66




---



##### Table of Contents



Zhou Jiping,
  Wang Yilin, State-owned
  Zeng Yukang,
  Wang Fucheng,
 67




---



##### Table of Contents



Li Xinhua,
  Liao Yongyuan,
  Wang Guoliang,
  Jiang Fan,
  Independent
    Non-executive Directors
  Chee-Chen Tung,
 68




---



##### Table of Contents



Liu Hongru,
  Franco Bernabè,
  Li Yongwu,
  Cui Junhui,
 69




---



##### Table of Contents



Secretary
    to the Board of Directors
  Li Hualin,
  Other
    Senior Management Personnel
  Sun Longde,
  Shen Diancheng,
  Liu Hongbin,
  Zhou Mingchun,
 70




---



##### Table of Contents



Zhao Zhengzhang,
  Bo Qiliang,
  Sun Bo,
  Lin Aiguo,
 71




---



##### Table of Contents



Wang Daofu,
  Huang Weihe, West-to-East West-to-East West-to-East
  Supervisors
  Chen Ming,
  Wen Qingshan,
  Sun Xianfeng,
 72




---



##### Table of Contents



Yu Yibo,
  Wang Yawei,
  Qin Gang,
  Wang Shali,
  Li Yuan,
  Wang Daocheng,
 73




---



##### Table of Contents



Compensation  Senior
    Management Compensation System
    Directors
    and Supervisors Compensation
             Board
    Practices   74




---



##### Table of Contents



Audit
    Committee
    
    reviewing and supervising the engagement of external auditors
    and their performance;
    reviewing and ensuring the completeness of annual reports,
    interim reports and quarterly reports, if any, 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 of directors in writing on the financial
    reports of the company and related information, having
    considered the issues raised by external auditors;
    reviewing and scrutinizing the work conducted by the internal
    audit department in according 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;
    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;
    reporting regularly to the board of directors in respect of any
    significant matters which may affect the financial position of
    the company and its operations and in respect of the
    self-evaluation of the committee on the performance of their
    duties; and
    performing other responsibilities as may be required under
    relevant laws, regulations and the listing rules of the stock
    exchanges where the shares of the company are listed (as amended
    from time to time).  Investment
    and Development Committee
    
    studying the strategies of the company as proposed by our
    president and making recommendations to the board of directors;
    studying the annual investment budget and the adjustment
    proposal regarding the investment plan as proposed by our
    president and making recommendations to the board of
    directors; and
    reviewing feasibility studies and preliminary feasibility
    studies for material investment projects subject to the approval
    of the board of directors and making recommendations to the
    board of directors.  Evaluation
    and Remuneration Committee
    
    organizing the evaluation of the performance of our president
    and reporting the evaluation result to the board of directors,
    supervising the evaluation of the performance of our senior vice
    presidents, vice presidents, 75




---



##### Table of Contents



chief financial officer and other senior management members
    conducted under the leadership of the president;  
    studying our incentive plan, compensation plan and stock
    appreciation rights plan, supervising and evaluating the
    implementation of these plans and making recommendations for
    improvements to and perfection of such plans; and
    performing other responsibilities as may be required under
    relevant laws, regulations and the listing rules of the stock
    exchanges where the shares of the company are listed (as amended
    from time to time).  Health,
    Safety and Environment Committee
    
    supervising the effective implementation of our Health, Safety
    and Environmental Protection Plan (HSE Plan);
    making recommendations to the board of directors and our
    president for major decisions with respect of health, safety and
    environmental protection; and
    inquiring the occurrence of and responsibilities for material
    accidents of the company, and examining and supervising the
    treatment of such accidents. Employees    Employees

% of TotalExploration and production


288,142



52.13Refining and chemicals


174,273



31.53Marketing


65,871



11.92Natural gas and pipeline


19,095



3.46Other(1)


5,317



0.96Total


552,698



100.00     (1)
    
    Including the numbers of employees of the management of our
    headquarters, specialized companies, PetroChina
    Exploration & Development Research Institute,
    PetroChina Planning & Engineering Institute,
    Petrochemical Research Institute and other units.     76




---



##### Table of Contents



Share
    Ownership    ITEM 7 
    MAJOR
    SHAREHOLDERS AND RELATED PARTY TRANSACTIONS Major
    Shareholders      Percentageof theIssued Share

PercentageCapital of the

ofSame

the TotalNumber of Shares

Class of

ShareName of Shareholders

Class of Shares

Held

Shares (%)

Capital (%)CNPC


A shares



157,764,597,259



97.432



86.200     Percentageof SuchShare in

PercentageThat Class

ofof the

the TotalNumber of Shares

Issued Shares

ShareName of Shareholders

Class of Shares

Held

Capital (%)

Capital (%)CNPC


H shares



149,892,000(1
)


0.710



0.082Aberdeen Asset Management Plc and its associates (together the
    Aberdeen Group) on behalf of accounts managed by the
    Aberdeen Group


H shares



1,266,618,163



6.003



0.692Templeton Asset Management Ltd.


H shares



1,270,171,357



6.020



0.694     (1)
    
    Held by Fairy King Investments Limited, an overseas wholly owned
    subsidiary of CNPC. Related
    Party Transactions    One-off
    Related Party Transactions
  Subscription
    for New Share Capital of China Petroleum Finance Co., Ltd
    (CPF)
   77




---



##### Table of Contents



Disposal
    of Equity Interest in PetroChina Guangxi Oil Storage
    Limited
      Continuing
    Related Party Transactions
  Form 20-F
    Form 20-F
  Loans
    from Related Parties
   Interests
    of Experts and Counsel   78




---



##### Table of Contents



ITEM 8 
    FINANCIAL
    INFORMATION Financial
    Statements   Dividend
    Policy      
    general business conditions;
    our financial results;
    capital requirements;
    contractual restrictions on the payment of dividends by us to
    our shareholders or by our subsidiaries to us;
    our shareholders interests;
    the effect on our debt ratings; and
    other factors our board of directors may deem relevant.    
    recovery of losses, if any;
    allocations to the statutory common reserve fund; and
    allocations to a discretionary common reserve fund if approved
    by our shareholders.      
    providing our shareholders with a competitive return on
    investment; and
    assuring sufficient reinvestment of profits to enable us to
    achieve our strategic objectives.   79




---



##### Table of Contents



Significant
    Changes  Operating
    and Financial Results in the First Quarter of 2011
  year-on-year.
 80




---



##### Table of Contents



ITEM 9 
    THE
    OFFER AND LISTING Nature of
    the Trading Market and Market Price Information        Price Per HShare

Price Per ADS

Price Per A ShareHK$

US$

RMBHigh

Low

High

Low

High

LowAnnual Data2006


11.12



6.35



142.12



83.50







2007


19.90



8.57



263.70



109.55



43.96



29.242008


14.24



4.25



182.12



57.25



31.31



9.952009


10.48



5.10



133.65



64.09



16.38



10.022010


10.50



7.97



136.45



101.92



14.28



9.94Quarterly Data2009First quarter


7.82



5.10



101.25



64.09



12.16



10.02Second quarter


9.41



6.11



122.78



80.98



14.48



11.22Third quarter


9.49



7.66



122.34



101.31



16.38



12.57Fourth quarter


10.48



8.52



133.65



109.67



14.16



12.982010First quarter


10.18



8.25



130.51



106.30



14.28



12.65Second quarter


9.55



7.97



122.67



101.92



13.23



10.25Third quarter


9.12



8.44



117.73



108.22



10.76



9.94Fourth quarter


10.50



9.39



136.45



120.44



12.74



10.472011First quarter


11.78



10.14



152.25



130.41



12.10



11.02Monthly Data2010December


10.16



9.64



131.49



123.64



11.95



10.97 81




---



##### Table of Contents



Price Per HShare

Price Per ADS

Price Per A ShareHK$

US$

RMBHigh

Low

High

Low

High

Low2011January


10.98



10.14



139.27



130.41



11.42



11.02February


11.16



10.22



143.53



132.23



11.71



11.41March


11.78



10.32



152.25



133.30



12.10



11.45April


12.34



11.16



156.44



145.58



12.18



11.68May (through May 6 2011)


11.00



10.48



144.65



133.38



11.72



11.15     ITEM 10 
    ADDITIONAL
    INFORMATION  Memorandum
    and Articles of Association  Our
    Articles of Association Currently in Effect
  Form 20-F Form 20-F
  Material
    Contracts   Foreign
    Exchange Controls    
    debt service on foreign currency-denominated debt;
    purchases of imported equipment and materials; and
    payment of any dividends declared in respect of the H Shares.       82




---



##### Table of Contents



Taxation    PRC
    Taxation
  Dividends
    and Individual Investors
  Individual Income Tax Law of the PRC Letter Concerning the Taxation
    Issues Relating to the Dividends Received by Foreign Individual
    Holders of Shares in Companies Listed in the PRC
  Dividends
    and Foreign Enterprises
  Enterprise Income Tax Law of the PRC Circular on Issues
    Concerning the Withholding of Corporate Income Tax by PRC
    Resident Enterprises from Dividends Payable to H Share
    Non-resident Corporate Shareholders
  Tax
    Treaties
    
    the United States;
    Australia;
    Canada;
    France;
    Germany; 83




---



##### Table of Contents




    Japan;
    Malaysia;
    Singapore;
    the United Kingdom; and
    the Netherlands.  Measures for the Administration of the Enjoyment by
    Non-residents of the Treatments under the Tax Treaties
  Capital
    Gains
  Individual Income Tax Law of the
    PRC, Provisions
    for Implementing the Individual Income Tax Law of the PRC Notice Concerning the Continued
    Provisional Exemption of Individual Income Tax on the Transfer
    of Shares by Individuals
  Enterprise Income Tax Law of the PRC Circular of the State Administration of
    Taxation on Printing and Issuing the Interim Measures for
    Administration of Withholding at Source of Income Tax of
    Non-resident Enterprises
  Additional
    PRC Tax Considerations
    United
    States Federal Income Taxation
    
    tax-exempt entities;
    certain insurance companies;
    broker-dealers; 84




---



##### Table of Contents




    traders in securities that elect to mark to market;
    U.S. holders liable for alternative minimum tax;
    U.S. holders that own 10% or more of our voting stock;
    U.S. holders that hold the H Shares or ADSs as part of a
    straddle or a hedging or conversion transaction; or
    U.S. holders whose functional currency is not the
    U.S. dollar.      
    a citizen or resident of the United States for United States
    federal income tax purposes;
    a corporation, or other entity treated as a corporation for
    United States federal income tax purposes, created or organized
    under the laws of the United States or any political subdivision
    thereof;
    an estate the income of which is subject to United States
    federal income tax without regard to its source; or
    a trust:  
    subject to the primary supervision of a United States court and
    the control of one or more United States persons; or
    that has elected to be treated as a United States person under
    applicable United States Treasury regulations.      We urge you to consult your tax advisors regarding the United
    States federal, state, local and
    non-United States
    tax consequences of the purchase, ownership and disposition of
    the H Shares or ADSs.
    Distributions
    on the H Shares or ADSs
    
    a foreign corporation that is eligible for the benefits of a
    comprehensive income tax treaty with the United States that
    includes an exchange of information program; or
    a foreign corporation if its stock with respect to which a
    dividend is paid (or ADSs backed by such stock) is readily
    tradable on an established securities market within the United
    States, 85




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##### Table of Contents



non-United
  Sale,
    Exchange or Other Disposition
      PFIC
    Rules
    
    75% or more of its gross income consists of passive income, such
    as dividends, interest, rents and royalties; or 86




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##### Table of Contents




    50% or more of the average quarterly value of its assets
    consists of assets that produce, or are held for the production
    of, passive income.      mark-to-market mark-to-market
      Backup
    Withholding and Information Reporting
    
    are a corporation or fall within various other exempt
    categories, and, when required, demonstrate this fact; or
    provide a correct taxpayer identification number on a properly
    completed IRS
    Form W-9
    or a substitute form, certify that you are exempt from backup
    withholding and otherwise comply with applicable requirements of
    the backup withholding rules. 87




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##### Table of Contents



Documents
    on Display  1-800-SEC-0330
  Form 20-F.
  ITEM 11 
    QUANTITATIVE
    AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK      Interest
    Rate Risk
    Foreign
    Exchange Rate Risk
     88




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##### Table of Contents



December 31,
    2010
  Percentageto TotalExpected Maturity Date

Long-Term

Fair2011

2012

2013

2014

2015

Thereafter

Total

Debt

Value(RMB equivalent in millions, except percentages)Long term debtLoans in RMBFixed Rate Loan Amount


8



5,555



771



6



6



84



6,430



4.71
%


6,190Average interest rate


3.54
%


4.32
%


4.37
%


2.55
%


4.04
%


2.55
%










Variable Rate Loan Amount


101



204



5,155



11



7



6,054



11,532



8.45
%


11,532Average interest rate


5.42
%


4.69
%


4.32
%


5.06
%


2.55
%


4.75
%










Loans in EurosFixed Rate Loan Amount


42



38



29



25



25



128



287



0.21
%


51Average interest rate


1.33
%


1.17
%


1.19
%


1.36
%


1.34
%


1.42
%










Variable Rate Loan Amount


































Average interest rate


































Loans in United States DollarsFixed Rate Loan Amount


35



36



36



36



857



333



1,333



0.98
%


1,283Average interest rate


1.48
%


1.43
%


1.43
%


1.43
%


4.20
%


1.36
%










Variable Rate Loan Amount


2,719



1,201



539



6,626







2,646



13,731



10.06
%


13,730Average interest rate


1.10
%


2.73
%


1.65
%


1.31
%






1.01
%










Loans in Japanese YenFixed Rate Loan Amount


22



22



22



22



22



105



215



0.16
%


Average interest rate


2.46
%


2.46
%


2.46
%


2.46
%


2.46
%


2.43
%










Variable Rate Loan Amount


































Average interest rate


































Debentures in Canadian DollarFixed Rate Loan Amount


































Average interest rate


































Variable Rate Loan Amount










2,977















2,977



2.18
%


2,977Average interest rate










2.08
%






















Debentures in United States DollarFixed Rate Loan Amount


166



















274



440



0.32
%


426Average interest rate


9.50
%


















3.00
%










Debentures in RMBFixed Rate Loan Amount


2,000







1,500















3,500



2.57
%


3,516Average interest rate


3.76
%






4.11
%






















Medium term note in RMBFixed Rate Loan Amount






30,000







15,000



40,000



11,000



96,000



70.36
%


94,237Average interest rate






2.49
%






3.35
%


3.97
%


4.60
%










Total


5,093



37,056



11,029



21,726



40,917



20,624



136,445



100.00
%


133,942  89




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##### Table of Contents



December 31,
    2009
  Percentageto TotalExpected Maturity Date

Long-Term

Fair2010

2011

2012

2013

2014

Thereafter

Total

Debt

Value(RMB equivalent in millions, except percentages)Long term debtLoans in RMBFixed Rate Loan Amount


233



221



5560











26



6,040



6.06
%


5,824Average interest rate


4.64
%


4.78
%


4.32
%










2.91
%










Variable Rate Loan Amount


11,306



135



68



33



552



6,045



18,139



18.19
%


18,139Average interest rate


4.90
%


5.38
%


5.33
%


5.40
%


6.03
%


3.70
%










Loans in EurosFixed Rate Loan Amount


16



16



16



16



15



113



192



0.19
%


65Average interest rate


2.12
%


2.12
%


2.12
%


2.12
%


2.12
%


2.11
%










Variable Rate Loan Amount


































Average interest rate


































Loans in United States DollarsFixed Rate Loan Amount


37



37



37



37



37



1,225



1,410



1.41
%


1,517Average interest rate


1.43
%


1.43
%


1.43
%


1.43
%


1.43
%


5.95
%










Variable Rate Loan Amount


2,456



9,632



1,580



83



8,287



2,735



24,733



24.85
%


24,733Average interest rate


1.00
%


1.95
%


2.54
%


1.91
%


1.80
%


1.72
%










Loans in Japanese YenFixed Rate Loan Amount


10























10



0.01
%


10Average interest rate


2.42
%






























Variable Rate Loan Amount


































Average interest rate


































Debentures in United States DollarFixed Rate Loan Amount


171



171















294



636



0.64
%


630Average interest rate


9.50
%


9.50
%














3.00
%










Debentures in RMBFixed Rate Loan Amount






2,000







1,500











3,500



3.51
%


3,516Average interest rate






3.76
%






4.11
%


















Medium term note in RMBFixed Rate Loan Amount










30,000







15,000







45,000



45.14
%


43,587Average interest rate










2.49
%






3.35
%














Total


14,229



12,212



37,261



1,669



23,891



10,438



99,700



100.00
%


98,061  90




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##### Table of Contents



December 31,
    2008
  Percentageto TotalExpected Maturity Date

Long-Term

Fair2009

2010

2011

2012

2013

Thereafter

Total

Debt

Value(RMB equivalent in millions, except percentages)Long term debtLoans in RMBFixed Rate Loan Amount


2



2















3



7



0.02
%


5Average interest rate


0



7.47
%














0











Variable Rate Loan Amount


5,220



11,351



274



20







6,000



22,865



59.59
%


22,865Average interest rate


6.07
%


5.51
%


5.84
%


6.20
%






6.26
%










Loans in EurosFixed Rate Loan Amount


15



17



17



16



16



126



207



0.54
%


147Average interest rate


2.11
%


2.12
%


2.12
%


2.12
%


2.12
%


2.10
%










Variable Rate Loan Amount


































Average interest rate


































Loans in United States DollarsFixed Rate Loan Amount


66



37



37



37



37



416



630



1.64
%


367Average interest rate


3.88
%


1.43
%


1.43
%


1.43
%


1.43
%


1.38
%










Variable Rate Loan Amount


63



3,826



2,805



248



254



3,132



10,328



26.92
%


10,328Average interest rate


2.36
%


2.80
%


2.88
%


6.23
%


6.15
%


2.94
%










Loans in Japanese YenFixed Rate Loan Amount


7



13



















20



0.05
%


19Average interest rate


2.42
%


2.42
%


























Variable Rate Loan Amount


































Average interest rate


































Debentures in United States DollarsFixed Rate Loan Amount


171



171



171











301



814



2.12
%


758Average interest rate


9.50
%


9.50
%


9.50
%










3.00
%










Debentures in RMBFixed Rate Loan Amount










2,000







1,500







3,500



9.12
%


3,262Average interest rate










3.76
%






4.11
%














Total


5,544



15,417



5,304



321



1,807



9,978



38,371



100.00
%


37,751   Commodity
    Price Risk
   91




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##### Table of Contents



ITEM 12 
    DESCRIPTION
    OF SECURITIES OTHER THAN EQUITY SECURITIES  Fees paid
    by our ADS holders
    Persons Depositing or Withdrawing Shares Must Pay:

For:$5.00 (or less) per 100 ADSs (or portion of 100 ADSs)

Issuance of ADSs, including issuances resulting from a
    distribution of shares or rights or other propertyCancellation of ADSs for the purpose of withdrawal, including if
    the deposit agreement terminates$0.02 (or less) per ADS

Any cash distribution to ADS registered holdersA fee equivalent to the fee that would be payable if securities
    distributed to you had been shares and the shares had been
    deposited for issuance of ADSs

Distribution of securities distributed to holders of deposited securities which are distributed by the depositary to ADS registered holdersRegistration or transfer fees

Transfer and registration of shares on our share register to or from the name of the depositary or its agent when you deposit or withdraw sharesExpenses of the depositary

Cable, telex and facsimile transmissions (when expressly provided in the deposit agreement)Converting foreign currency to U.S. dollarsTaxes and other governmental charges the depositary or the
    custodian have to pay on any ADS or share underlying an ADS, for
    example, stock transfer taxes, stamp duty or withholding taxes

As necessaryAny charges incurred by the depositary or its agents for
    servicing the deposited securities

As necessary   Fees and
    Payments from the Depositary to Us
   PART II  ITEM 13 
    DEFAULTS,
    DIVIDENDS ARREARAGES AND DELINQUENCIES    ITEM 14 
    MATERIAL
    MODIFICATIONS TO THE RIGHTS TO SECURITY HOLDERS AND USE OF
    PROCEEDS   92




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##### Table of Contents



ITEM 15 
    CONTROLS
    AND PROCEDURES  Evaluation
    of the Management on Disclosure Controls and
    Procedures
  Rules 13a-15(e)
  Managements
    Report on Internal Control over Financial Reporting
  13a-15(f). Internal Control  Integrated Framework
      Changes
    in Internal Control over Financial Reporting
    ITEM 16A 
    AUDIT
    COMMITTEE FINANCIAL EXPERT  Form 20-F.
  ITEM 16B 
    CODE
    OF ETHICS    www.petrochina.com.cn,
      3.
    Finally, click on Code of Ethics for Senior
    Management or Code of Ethics for Employees of
    PetroChina Company Limited. 93




---



##### Table of Contents



ITEM 16C 
    PRINCIPAL
    ACCOUNTANT FEES AND SERVICES  Form 20-F.
      December 31,2009

2010RMB

RMB(In millions)Audit fees


80



74Audit-related fees






Tax fees






All other fees






Total


80



74       Audit
    Committee Pre-approved Policies and Procedures
    de minimis Rule 2-01 Regulation S-X.
  ITEM 16D 
    EXEMPTIONS
    FROM LISTING STANDARDS FOR AUDIT COMMITTEES  Rule 10A-3 Rule 10A-3.
  ITEM 16E 
    PURCHASES
    OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED
    PURCHASERS   94




---



##### Table of Contents



ITEM 16F 
    CHANGE
    IN REGISTRANTS CERTIFYING ACCOUNTANT    ITEM 16G 
    CORPORATE
    GOVERNANCE      Director
    Independence
      Nominating/Corporate
    Governance Committee
    Compensation
    Committee
      Corporate
    Governance Guidelines
   95




---



##### Table of Contents




    director qualification standards and responsibilities;
    key board committee responsibilities;
    director compensation; and
    director orientation and continuing education.        Code of
    Business Conduct and Ethics
  Form 20-F
  Certification
    Requirements
   PART III  ITEM 17 
    FINANCIAL
    STATEMENTS   96




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##### Table of Contents



ITEM 18 
    FINANCIAL
    STATEMENTS  page F-1 F-50
  ITEM 19 
    EXHIBITS      ExhibitNumber

Description of Exhibits1
.1

Articles of Association (as amended) (English
    translation)(4)1
.2

Articles of Association (as amended on May 15, 2008) (English
    translation)(4)4
.1

2011 Management Performance Contract (English Translation)4
.2

Risk Operation Service Business Assets Transfer Agreement, dated
    August 23, 2007, between CNPC and PetroChina (English
    Translation)(4)4
.3

Capital Injection Agreement Concerning CNPC Exploration and
    Development Company Limited, dated December 27, 2007, among
    CNODC, CNPC E&D and PetroChina (English
    Translation)(4)4
.4

Annual Crude Oil Mutual Supply Framework Agreement, dated
    January 12, 2011, between China Petroleum and Chemical
    Corporation and PetroChina (English translation)4
.5

Second Supplemental Agreement to Comprehensive products and
    Services Agreement, dated September 1, 2005, between CNPC
    and PetroChina (English
    translation)(1)4
.6

Supplementary Agreement to Comprehensive Products and Services
    Agreement, dated June 9, 2005, between CNPC and PetroChina
    (English
    Translation)(2)4
.7

Form of Non-competition Agreement between CNPC and PetroChina
    (together with English
    translation)(3)4
.8

Form of Comprehensive Products and Services Agreement between
    CNPC and PetroChina (together with English
    translation)(3)4
.9

Form of Land Use Rights Leasing Contract between CNPC and
    PetroChina (together with English
    translation)(3)4
.10

Form of Buildings Leasing Contract between CNPC and PetroChina
    (together with English
    translation)(3)4
.11

Form of Trademark Licensing Contract between CNPC and PetroChina
    (together with English
    translation)(3)4
.12

Form of Patent and Know-how Licensing Contract between CNPC and
    PetroChina (together with English
    translation)(3)4
.13

Form of Computer Software Licensing Contract between CNPC and
    PetroChina (together with English
    translation)(3)4
.14

Form of Contract for Transfer of Rights under Production Sharing
    Contracts between CNPC and PetroChina (together with English
    translation)(3)4
.15

Form of Guarantee of Debts Contract between CNPC and PetroChina
    (together with English
    translation)(3)4
.16

Form of Contract for the Supervision of Certain Sales
    Enterprises between CNPC and PetroChina (together with English
    translation)(3)4
.17

Form of Agreement for Transfer of Rights and Interests under the
    Crude Oil Premium and Discount Calculation Agreement between
    China Petrochemical Corporation, CNPC and PetroChina (together
    with English
    translation)(3)4
.18

Form of Agreement for the Transfer of Rights and Interests under
    the Retainer Contracts relating to Oil Exploration and
    Exploitation in Lengjiapu Area, Liaohe Oil Region and No.
    9.1-9.5 Areas, Karamay Oil Field (together with English
    translation)(3) 97




---



##### Table of Contents



ExhibitNumber

Description of Exhibits4
.19

Equity Interests Transfer Agreement, dated May 15, 2009, between
    PetroChina Kunlun Gas Limited and China Petroleum Pipeline
    Bureau; Form of Equity Interests Transfer Agreements, dated May
    15, 2009, between PetroChina Kunlun Gas Limited and China Huayou
    Group Corporation; Assets Transfer Agreement, dated May 15,
    2009, between PetroChina Kunlun Gas Limited and China Petroleum
    Pipeline Bureau (English
    translation)(5)4
.20

Asset Transfer Agreement, dated June 18, 2009, between
    PetroChina West Pipeline Company and CNPC West Pipeline Company
    Limited (English
    translation)(6)4
.21

Equity Transfer Agreement, dated August 28, 2009, among CNPC
    E&D, CNPC Central Asia and PetroChina (English
    translation)(6)4
.22

Asset Transfer Agreement, dated August 28, 2009, between ten
    branch companies of PetroChina and ten subordinated entities of
    CNPC including CNPC Daqing Petrochemical Factory (English
    translation)(6)4
.23

Equity Transfer Agreement, dated December 30, 2009, between
    PetroChina Kunlun Gas Limited and Daqing Petroleum
    Administrative Bureau (English
    translation)(6)4
.24

Subscription Agreement, Dated March 25, 2010 among PetroChina,
    CNPC and CPF (English
    translation)(6)4
.25

Acquisition Agreement, Dated November 25, 2010 between
    PetroChina and China National United Oil Corporation (English
    translation)4
.26

Equity Transfer Agreement, Dated December 31, 2010 between
    PetroChina Guangxi International Enterprises Limited and CNPC
    (English translation)8
.1

List of major subsidiaries11
.1

Code of Ethics for Senior
    Management(2)11
.2

Code of Ethics for
    Employees(2)12
.1

Certification of Chief Executive Officer required by Section 302
    of the Sarbanes-Oxley Act of 200212
.2

Certification of Chief Financial Officer required by Section 302
    of the Sarbanes-Oxley Act of 200213
.1

Certification of Chief Executive Officer required by
    18 U.S.C. Section 1350, as adopted pursuant to
    Section 906 of the Sarbanes-Oxley Act of 200213
.2

Certification of Chief Financial Officer required by
    18 U.S.C. Section 1350, as adopted pursuant to
    Section 906 of the Sarbanes-Oxley Act of 200215
.1

Reserve Report for the year ended on December 31, 2010 prepared
    by DeGolyer and MacNaughton15
.2

Reserve Report for the year ended on December 31, 2010 prepared
    by Gaffney, Cline & Associates (Consultants) Pte Ltd     (1)
    
    Incorporated by reference to our annual report on
    Form 20-F
    for the fiscal year ended December 31, 2005
    (File No. 1-15006)
    filed with the Commission.(2)
    
    Incorporated by reference to our annual report on
    Form 20-F
    for the fiscal year ended December 31, 2004
    (File No. 1-15006)
    filed with the Commission.(3)
    
    Incorporated by reference to our Registration Statement on
    Form F-1
    (File No.
    333-11566)
    filed with the Commission, as declared effective on
    March 29, 2000.(4)
    
    Incorporated by reference to our annual report on
    Form 20-F
    for the fiscal year ended December 31, 2007
    (File No. 1-15006)
    filed with the Commission.(5)
    
    Incorporated by reference to our annual report on
    Form 20-F
    for the fiscal year ended December 31, 2008
    (File No. 1-15006)
    filed with the Commission.(6)
    
    Incorporated by reference to our annual report on
    Form 20-F
    for the fiscal year ended December 31, 2009
    (File No. 1-15006)
    filed with the Commission. 98




---



##### Table of Contents



SIGNATURE
  Form 20-F
    
   Title:
    Secretary to Board of Directors    99




---



##### Table of Contents



INDEX OF
    CONSOLIDATED FINANCIAL STATEMENTS
  PagePetroChina Company Limited and its Subsidiaries Consolidated
    Financial StatementsReport of Independent Registered Public
    Accounting Firm


F-2Consolidated Statement of Comprehensive Income
    for each of the three years in the period ended
    December 31, 2010


F-3Consolidated Statement of Financial Position as
    of December 31, 2009 and 2010


F-4Consolidated Statement of Cash Flows for each of
    the three years in the period ended December 31, 2010


F-5Consolidated Statement of Changes in Equity for
    each of the three years in the period ended December 31,
    2010


F-7Notes to the Consolidated Financial Statements


F-8Supplementary information on Oil and Gas
    Producing Activities (unaudited)


F-44  F-1




---



##### Table of Contents



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM    Internal Control  Integrated Framework
      
  F-2




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  CONSOLIDATED STATEMENT OF COMPREHENSIVE
    INCOME
 For the year ended December 31, 2010,
    2009 and 2008
  Notes

2010

2009

2008RMB

RMB

RMB(Amounts in millions)TURNOVER


6



1,465,415



1,019,275



1,072,604OPERATING EXPENSESPurchases, services and other






(795,525
)


(492,472
)


(562,851
)Employee compensation costs


8



(83,304
)


(65,977
)


(62,167
)Exploration expenses, including exploratory dry holes






(22,963
)


(19,398
)


(21,879
)Depreciation, depletion and amortisation






(113,209
)


(92,259
)


(94,759
)Selling, general and administrative expenses






(74,239
)


(65,423
)


(59,617
)Taxes other than income taxes


9



(184,209
)


(135,465
)


(124,132
)Other (expenses)/income, net






(4,189
)


(4,837
)


12,372TOTAL OPERATING EXPENSES






(1,277,638
)


(875,831
)


(913,033
)PROFIT FROM OPERATIONS






187,777



143,444



159,571FINANCE COSTSExchange gain






1,685



552



1,774Exchange loss






(2,857
)


(1,335
)


(2,855
)Interest income






1,983



1,459



2,277Interest expense


10



(6,321
)


(5,272
)


(3,044
)TOTAL NET FINANCE COSTS






(5,510
)


(4,596
)


(1,848
)SHARE OF PROFIT OF ASSOCIATES AND JOINTLY CONTROLLED
    ENTITIES


17



7,038



1,184



4,290PROFIT BEFORE INCOME TAX EXPENSE


7



189,305



140,032



162,013INCOME TAX EXPENSE


12



(38,513
)


(33,473
)


(35,211
)PROFIT FOR THE YEAR






150,792



106,559



126,802OTHER COMPREHENSIVE INCOMECurrency translation differences






2,687



(3,500
)


(2,676
)Fair value gain/(loss) from
    available-for-sale
    financial assets






114



191



(340
)Income tax relating to components of other comprehensive
    income/(loss)






(5
)


(38
)


67OTHER COMPREHENSIVE INCOME/(LOSS), NET OF TAX






2,796



(3,347
)


(2,949
)TOTAL COMPREHENSIVE INCOME FOR THE YEAR






153,588



103,212



123,853PROFIT FOR THE YEAR ATTRIBUTABLE TO:Owners of the Company






139,992



103,387



114,453Non-controlling interest






10,800



3,172



12,349150,792



106,559



126,802TOTAL COMPREHENSIVE INCOME FOR THE YEAR ATTRIBUTABLE TO:Owners of the Company






143,186



102,067



113,044Non-controlling interest






10,402



1,145



10,809153,588



103,212



123,853BASIC AND DILUTED EARNINGS PER SHARE FOR PROFIT ATTRIBUTABLE
    TO OWNERS OF THE COMPANY (RMB)


14



0.76



0.56



0.63    F-3




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  CONSOLIDATED STATEMENT OF FINANCIAL POSITION
 As of December 31, 2010 and
    2009
  Notes

2010

2009RMB

RMB(Amounts in millions)NON-CURRENT ASSETSProperty, plant and equipment

16


1,238,599



1,075, 467Investments in associates and jointly controlled entities

17


64,137



28,223Available-for-sale
    financial assets

18


1,979



2,343Advance operating lease payments

20


36,155



30,236Intangible and other assets

21


25,453



18,017Deferred tax assets

31


284



289Time deposits with maturities over one year




3,488



1,330TOTAL NON-CURRENT ASSETS




1,370,095



1,155,905CURRENT ASSETSInventories

22


134,888



114,781Accounts receivable

23


45,005



28,785Prepaid expenses and other current assets

24


51,822



59,595Notes receivable

25


5,955



4,268Time deposits with maturities over three months but within one
    year




3,013



29Cash and cash equivalents

26


45,709



86,925TOTAL CURRENT ASSETS




286,392



294,383CURRENT LIABILITIESAccounts payable and accrued liabilities

27


270,191



204,739Income taxes payable




22,169



9,721Other taxes payable




35,108



25,242Short-term borrowings

28


102,268



148,851TOTAL CURRENT LIABILITIES




429,736



388,553NET CURRENT LIABILITIES




(143,344
)


(94,170
)TOTAL ASSETS LESS CURRENT LIABILITIES




1,226,751



1,061,735EQUITYEquity attributable to owners of the Company:Share capital

29


183,021



183,021Retained earnings




499,288



424,067Reserves

30


256,617



240,135Total Equity attributable to owners of the Company




938,926



847,223Non-controlling interest




71,203



60,478TOTAL EQUITY




1,010,129



907,701NON-CURRENT LIABILITIESLong-term borrowings

28


131,352



85,471Asset retirement obligations

32


60,364



44,747Deferred tax liabilities

31


21,515



21,449Other long-term obligations




3,391



2,367TOTAL NON-CURRENT LIABILITIES




216,622



154,034TOTAL EQUITY AND NON-CURRENT LIABILITIES




1,226,751



1,061,735   Chairman

Vice Chairman and President

Chief Financial OfficerJiang Jiemin

Zhou Jiping

Zhou Mingchun    F-4




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  CONSOLIDATED STATEMENT OF CASH FLOWS
 For
    the Year Ended December 31, 2010, 2009 and 2008
  2010

2009

2008RMB

RMB

RMB(Amounts in millions)CASH FLOWS FROM OPERATING ACTIVITIESProfit for the year


150,792



106,559



126,802Adjustments for:Income tax expense


38,513



33,473



35,211Depreciation, depletion and amortisation


113,209



92,259



94,759Capitalised exploratory costs charged to expense


10,714



10,019



10,341Share of profit of associates and jointly controlled entities


(7,038
)


(1,184
)


(4,290
)(Reversal) of provision / provision for impairment of
    receivables, net


(174
)


(123
)


4Write down in inventories, net


197



354



8,593Impairment of
    available-for-sale
    financial assets, net


4



2



45Impairment of investments in associates and jointly controlled
    entities






8



29Loss on disposal of property, plant and equipment


2,822



1,642



2,602(Gain)/loss on disposal of intangible and other assets


(6
)


10



19Loss/(gain) on disposal of investments in associates and jointly
    controlled entities


3



(33
)


3Gain on disposal of
    available-for-sale
    financial assets


(8
)


(4
)


(5
)Loss/(gain) on disposal of subsidiaries


23



(22
)


(259
)Dividend income


(165
)


(177
)


(252
)Interest income


(1,983
)


(1,459
)


(2,277
)Interest expense


6,321



5,272



3,044Advance payments on long-term operating leases


(8,110
)


(6,045
)


(4,675
)Changes in working capital:Accounts receivable and prepaid expenses and other current assets


(10,105
)


16,240



(26,815
)Inventories


(20,004
)


(20,044
)


(10,775
)Accounts payable and accrued liabilities


61,850



41,637



(5,715
)CASH FLOWS GENERATED FROM OPERATIONS


336,855



278,384



226,389Income taxes paid


(26,169
)


(16,412
)


(53,924
)NET CASH FLOWS FROM OPERATING ACTIVITIES


310,686



261,972



172,465    F-5




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  CONSOLIDATED
    STATEMENT OF CASH FLOWS  (Continued)
 For
    the Year Ended December 31, 2010, 2009 and 2008
  2010

2009

2008RMB

RMB

RMB(Amounts in millions)CASH FLOWS FROM INVESTING ACTIVITIESCapital expenditures


(259,120
)


(257,562
)


(215,610
)Acquisition of investments in associates and jointly controlled
    entities


(32,052
)


(1,487
)


(3,641
)Acquisition of
    available-for-sale
    financial assets


(73
)


(111
)


(23
)Acquisition of intangible assets and other non-current assets


(5,062
)


(3,505
)


(3,909
)Purchase of non-controlling interest


(411
)


(533
)


(177
)Acquisition of subsidiaries


(1,389
)


(16,451
)


(6,693
)Proceeds from disposal of property, plant and equipment


722



4,053



436Proceeds from disposal of investments in associates and jointly
    controlled entities


136



139



67Proceeds from disposal of subsidiaries


2,082



60



535Proceeds from disposal of
    available-for-sale
    financial assets


76



136



52Proceeds from disposal of intangible and other non-current assets


127



26



37Interest received


1,938



1,425



2,365Dividends received


7,065



783



4,095(Increase)/decrease in time deposits with maturities over three
    months


(5,231
)


11,574



10,669NET CASH FLOWS USED FOR INVESTING ACTIVITIES


(291,192
)


(261,453
)


(211,797
)CASH FLOWS FROM FINANCING ACTIVITIESRepayments of short-term borrowings


(227,677
)


(113,212
)


(84,471
)Repayments of long-term borrowings


(43,855
)


(7,947
)


(14,196
)Interest paid


(6,746
)


(5,238
)


(4,065
)Dividends paid to non-controlling interest


(2,955
)


(2,425
)


(2,805
)Dividends paid to owners of the Company


(53,198
)


(50,092
)


(52,835
)Dividends paid to owners from business combinations
    pre-acquisition










(801
)Increase in short-term borrowings


190,194



157,576



153,444Increase in long-term borrowings


80,828



67,880



4,472Capital contribution from non-controlling interest


5,118



7,098



8,788Capital reduction of subsidiaries


(2,368
)


(671
)


(3,754
)(Decrease)/increase in other long-term obligations


(285
)


108



NET CASH FLOWS (USED FOR)/FROM FINANCING ACTIVITIES


(60,944
)


53,077



3,777TRANSLATION OF FOREIGN CURRENCY


234



179



(112
)(Decrease)/increase in cash and cash equivalents


(41,216
)


53,775



(35,667
)Cash and cash equivalents at beginning of the year


86,925



33,150



68,817Cash and cash equivalents at end of the year


45,709



86,925



33,150    F-6




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  CONSOLIDATED
    STATEMENT OF CHANGES IN EQUITY
 For
    the Year Ended December 31, 2010, 2009 and 2008
  Attributable to Owners of the Company

Non-Share

Retained





Controlling

TotalCapital

Earnings

Reserves

Subtotal

Interest

EquityRMB

RMB

RMB

RMB

RMB

RMB(Amounts in millions)Balance at December 31, 2007


183,021



333,779



221,404



738,204



43,896



782,100Business combination under common control






(139
)


181



42



577



619Balance at January 1, 2008


183,021



333,640



221,585



738,246



44,473



782,719Total comprehensive income/(loss) for the year ended
    December 31, 2008






114,453



(1,409
)


113,044



10,809



123,853Special Reserve-Safety Fund Reserve






(3,214
)


3,214











Transfer to reserves






(12,770
)


12,770











Dividends






(52,835
)






(52,835
)


(2,842
)


(55,677
)Purchase of non-controlling interest in subsidiaries










(17
)


(17
)


(160
)


(177
)Capital contribution from non-controlling interest


















8,788



8,788Capital reduction of subsidiaries










(61
)


(61
)


(3,693
)


(3,754
)Dividends to owners from business combinations pre-acquisition






(801
)






(801
)






(801
)Disposal of subsidiaries


















(429
)


(429
)Acquisition of a subsidiary










(6,693
)


(6,693
)






(6,693
)Other










27



27



(16
)


11Balance at December 31, 2008


183,021



378,473



229,416



790,910



56,930



847,840Total comprehensive income/(loss) for the year ended
    December 31, 2009






103,387



(1,320
)


102,067



1,145



103,212Special Reserve-Safety Fund Reserve






2,280



1,325



3,605



3



3,608Transfer to reserves






(9,981
)


9,981











Dividends






(50,092
)






(50,092
)


(2,358
)


(52,450
)Acquisition of subsidiaries










(248
)


(248
)


590



342Purchase of non-controlling interest in subsidiaries










(179
)


(179
)


(354
)


(533
)Capital contribution from non-controlling interest










1,158



1,158



5,940



7,098Capital reduction of a subsidiary


















(1,354
)


(1,354
)Other










2



2



(64
)


(62
)Balance at December 31, 2009


183,021



424,067



240,135



847,223



60,478



907,701Total comprehensive income for the year ended December 31,
    2010






139,992



3,194



143,186



10,402



153,588Special Reserve-Safety Fund Reserve






1,016



416



1,432



17



1,449Transfer to reserves






(13,190
)


13,190











Dividends






(53,198
)






(53,198
)


(2,995
)


(56,193
)Acquisition of subsidiaries










(572
)


(572
)


967



395Purchase of non-controlling interest in subsidiaries










(87
)


(87
)


(324
)


(411
)Capital contribution from non-controlling interest










3



3



5,115



5,118Capital reduction of a subsidiary


















(2,368
)


(2,368
)Disposal of subsidiaries


















(47
)


(47
)Other






601



338



939



(42
)


897Balance at December 31, 2010


183,021



499,288



256,617



938,926



71,203



1,010,129    F-7




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL STATEMENTS
 (Amounts
    in millions unless otherwise stated)
  1
    ORGANISATION
    AND PRINCIPAL ACTIVITIES      2
    BASIS OF
    PREPARATION      3
    SUMMARY
    OF PRINCIPAL ACCOUNTING POLICIES  (a)
    Basis
    of consolidation       F-8




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
            (b)
    Investments
    in associates          (c)
    Investments
    in jointly controlled entities     F-9




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  (d)
    Transactions
    with non-controlling interest        (e)
    Foreign
    currencies        (f)
    Property,
    plant and equipment     F-10




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Buildings


8 - 40 yearsEquipment and Machinery


4 - 30 yearsMotor vehicles


4 - 14 yearsOther


5 - 12 years             Changes
    in accounting policy
      (g)
    Oil
    and gas properties  12-month
 F-11




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  first-day-of-the-month
        (h)
    Intangible
    assets    (i)
    Financial
    assets  held-to-maturity available-for-sale available-for-sale available-for-sale
  (i)
    Loans and
    receivables   F-12




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  (ii)
    Available-for-sale
    financial assets  Available-for-sale available-for-sale
  available-for-sale Available-for-sale Available-for-sale Available-for-sale Available-for-sale available-for-sale available-for-sale
  (iii)
    Financial
    assets at fair value through profit or loss    (j)
    Leases      (k)
    Inventories    (l)
    Accounts
    receivable   F-13




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    (m)
    Cash
    and cash equivalents    (n)
    Accounts
    payable    (o)
    Borrowings        (p)
    Taxation        (q)
    Revenue
    recognition   F-14




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  take-or-pay take-or-pay take-or-pay
  (r)
    Provisions      (s)
    Research
    and development    (t)
    Retirement
    benefit plans      (u)
    New
    accounting developments    The following new standards and amendments to standards are
    mandatory for the first time for the financial year beginning
    1 January 2010:
    acquisition-by-acquisition
 F-15




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
          The following applicable amendment is mandatory for the first
    time for year beginning January 1, 2011:
           F-16




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      4
    FINANCIAL
    RISK AND CAPITAL MANAGEMENT  4.1
    Financial
    risk factors    (a)
    Market
    risk    (i)
    Foreign
    exchange risk      (ii)
    Interest
    rate risk   F-17




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  (iii)
    Price
    risk    (b)
    Credit
    risk            (c)
    Liquidity
    risk          4.2
    Capital
    management      4.3
    Fair
    value estimation   F-18




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    5
    CRITICAL
    ACCOUNTING ESTIMATES AND JUDGEMENTS      (a)
    Estimation
    of oil and natural gas reserves  unit-of-production
  (b)
    Estimation
    of impairment of property, plant and equipment    (c)
    Estimation
    of asset retirement obligations    6  TURNOVER
   F-19




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  7
    PROFIT
    BEFORE INCOME TAX EXPENSE  2010

2009

2008RMB

RMB

RMBItems credited and charged in arriving at the profit before
    income tax expense include:CreditedDividend income from
    available-for-sale
    financial assets


165



177



252Reversal of provision for impairment of receivables


210



240



184Reversal of write down in inventories


42



23



15Government grants(i)


1,599



1,097



16,914ChargedAmortisation on intangible and other assets


2,318



2,153



1,888Auditors remuneration


74



80



95Cost of inventories recognised as expense


947,246



613,702



662,758Provision for impairment of receivables


36



117



188Loss on disposal of property, plant and equipment


2,822



1,642



2,602Operating lease expenses


7,803



7,367



6,819Research and development expenses


11,840



9,887



7,760Write down in inventories


239



377



8,608     (i)
    
    Government grants during the year 2008 primarily comprise
    financial support measures provided by the PRC government to
    ensure supply of crude oil and refined products in the domestic
    market implemented from 2008.  8
    EMPLOYEE
    COMPENSATION COSTS  2010

2009

2008RMB

RMB

RMBWages, salaries and allowances


56,284



44,202



39,008Social security costs


27,020



21,775



23,15983,304



65,977



62,167     9
    TAXES
    OTHER THAN INCOME TAXES   F-20




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  10
    INTEREST
    EXPENSE  2010

2009

2008RMB

RMB

RMBInterest onBank loans wholly repayable within five years


1,797



1,339



2,065 not wholly repayable within five years


15



90



22Other loans wholly repayable within five years


4,721



4,624



1,365 not wholly repayable within five years


1,298



477



598Accretion expense (Note 32)


2,382



1,943



1,746Less: Amounts capitalised


(3,892
)


(3,201
)


(2,752
)6,321



5,272



3,044     11
    EMOLUMENTS
    OF DIRECTORS AND SUPERVISORS    2010

2009

2008Fee for

Salaries,

Contributiondirectors

allowances

to retirementand

and other

benefitName

supervisors

benefits

scheme

Total

Total

TotalRMB000

RMB000

RMB000

RMB000

RMB000

RMB000Chairman:Mr. Jiang Jiemin






















Vice Chairman:Mr. Zhou Jiping






941



40



981



774



515Executive directors:Mr. Duan Wende(i)






















366Mr. Liao Yongyuan






874



40



914



747



869



874



40



914



747



1,235Non-executive directors:Mr. Wang Yilin






















Mr. Zeng Yukang






















Mr. Wang Fucheng






















Mr. Wang Guoliang






















Mr. Li Xinhua






















Mr. Jiang Fan






664



30



694



519



569Mr. Chee-Chen Tung


254











254



260



249Mr. Liu Hongru


227











227



339



343Mr. Li Yongwu(ii)


240











240



344



197Mr. Cui Junhui


244











244



348



331Mr. Franco Bernabè


231











231



246



2431,196



664



30



1,890



2,056



1,932 F-21




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  2010

2009

2008Fee for

Salaries,

Contributiondirectors

allowances

to retirementand

and other

benefitName

supervisors

benefits

scheme

Total

Total

TotalRMB000

RMB000

RMB000

RMB000

RMB000

RMB000Supervisors:Mr. Chen Ming






















Mr. Wen Qingshan






















Mr. Sun Xianfeng






















Mr. Yu Yibo






















Mr. Wang Yawei






678



20



698







Mr. Qin Gang






636



38



674



541



521Ms. Wang Shali






















Mr. Li Yongwu(ii)






















110Mr. Zhang Jinzhu(i)






















206Mr. Wu Zhipan (iii)


















107



234Mr. Li Yuan


230











230



217



124Mr. Wang Daocheng (iii)


230











230



117



460



1,314



58



1,832



982



1,1951,656



3,793



168



5,617



4,559



4,877     (i)
    
    No longer an executive director or a supervisor since
    May 16, 2008.(ii)
    
    Elected as an independent non-executive director in May 16,
    2008 and no longer a supervisor since then.(iii)
    
    Mr. Wu Zhipan no longer as a supervisor since May 12,
    2009 and Mr. Wang Daocheng was elected as a supervisor
    since then.(iv)
    
    Emoluments set out above exclude RMB1.28 million paid to
    directors of the Company as part of the deferred merit pay for
    years 2007 to 2009 in accordance with relevant requirements by
    the PRC government.    2010

2009

2008Number

Number

NumberRMB Nil  RMB 1 million


23



24



25         12
    INCOME
    TAX EXPENSE  2010

2009

2008RMB

RMB

RMBCurrent taxes


38,617



24,862



43,423Deferred taxes (Note 31)


(104
)


8,611



(8,212
)38,513



33,473



35,211  F-22




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      2010

2009

2008RMB

RMB

RMBProfit before income tax expense


189,305



140,032



162,013Tax calculated at a tax rate of 25%


47,326



35,008



40,503Prior year tax return adjustment


(878
)


(2,216
)


25Effect of income taxes from international operations in excess
    of taxes at the PRC statutory tax rate


383



1,820



6,876Effect of preferential tax rate


(8,713
)


(5,502
)


(10,907
)Effect of change in statutory income tax rates on deferred taxes


(346
)


(184
)


(3,134
)Tax effect of income not subject to tax


(2,651
)


(1,140
)


(1,357
)Tax effect of expenses not deductible for tax purposes


3,392



5,687



3,205Income tax expense


38,513



33,473



35,211   13
    PROFIT
    ATTRIBUTABLE TO OWNERS OF THE COMPANY    14
    BASIC AND
    DILUTED EARNINGS PER SHARE      15
    DIVIDENDS  2010

2009

2008RMB

RMB

RMBInterim dividends attributable to owners of the Company for
    2010(a)


29,399







Proposed final dividends attributable to owners of the Company
    for 2010(b)


33,597







Interim dividends attributable to owners of the Company for
    2009(c)






22,725



Final dividends attributable to owners of the Company for 2009(d)






23,799



Interim dividends attributable to owners of the Company for
    2008(e)










24,127Final dividends attributable to owners of the Company for 2008(f)










27,36762,996



46,524



51,494     (a)
    
    Interim dividends attributable to owners of the Company in
    respect of 2010 of RMB 0.16063 yuan per share amounting to a
    total of RMB 29,399 were paid on October 15, 2010. F-23




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   (b)
    
    At the twelfth meeting of the Fourth Session of the Board of the
    Company, the Board of Directors proposed final dividends
    attributable to owners of the Company in respect of 2010 of RMB
    0.18357 yuan per share amounting to a total of RMB 33,597. 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 in the year ending December 31, 2011
    when approved at the forthcoming Annual General Meeting.(c)
    
    Interim dividends attributable to owners of the Company in
    respect of 2009 of RMB 0.12417 yuan per share amounting to a
    total of RMB 22,725 were paid on October 16, 2009.(d)
    
    Final dividends attributable to owners of the Company in respect
    of 2009 of RMB 0.13003 yuan per share amounting to a total of
    RMB 23,799 were paid on June 30, 2010.(e)
    
    Interim dividends attributable to owners of the Company in
    respect of 2008 of RMB 0.13183 yuan per share amounting to a
    total of RMB 24,127 were paid on October 16, 2008.(f)
    
    Final dividends attributable to owners of the Company in respect
    of 2008 of RMB 0.14953 yuan per share amounting to a total of
    RMB 27,367 were paid on June 19, 2009.(g)
    
    Final dividends attributable to owners of the Company in respect
    of 2007 of RMB 0.156859 yuan per share amounting to a total of
    RMB 28,708 were paid on June 13, 2008.  16
    PROPERTY,
    PLANT AND EQUIPMENT  Oil

EquipmentYear Ended



and Gas

and

Motor



ConstructionDecember 31, 2010

Buildings

Properties

Machinery

Vehicles

Other

in Progress

TotalRMB

RMB

RMB

RMB

RMB

RMB

RMBCostAt beginning of the year


110,910



888,849



452,564



20,184



11,051



225,479



1,709,037Additions


2,596



29,545



10,864



3,660



589



247,232



294,486Transfers


17,604



112,488



90,377







1,163



(221,632
)


Disposals or write-offs


(1,642
)


(4,880
)


(4,813
)


(708
)


(207
)


(10,714
)


(22,964
)Currency translation differences


(83
)


(1,066
)


(46
)


(29
)


172



(99
)


(1,151
)At end of the year


129,385



1,024,936



548,946



23,107



12,768



240,266



1,979,408Accumulated depreciation and impairmentAt beginning of the year


(32,113
)


(369,437
)


(218,288
)


(9,732
)


(3,725
)


(275
)


(633,570
)Charge for the year


(8,544
)


(68,702
)


(35,596
)


(2,163
)


(1,055
)


(21
)


(116,081
)Disposals or write-offs or transfers


860



2,976



3,500



400



141



152



8,029Currency translation differences


35



662



72



16



27



1



813At end of the year


(39,762
)


(434,501
)


(250,312
)


(11,479
)


(4,612
)


(143
)


(740,809
)Net book valueAt end of the year


89,623



590,435



298,634



11,628



8,156



240,123



1,238,599   F-24




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Oil

EquipmentYear Ended



and Gas

and

Motor



Construction inDecember 31, 2009

Buildings

Properties

Machinery

Vehicles

Other

Progress

TotalRMB

RMB

RMB

RMB

RMB

RMB

RMBCostAt beginning of the year


99,680



790,354



366,953



17,537



9,924



172,353



1,456,801Additions


4,516



11,141



27,315



3,277



2,880



236,285



285,414Transfers


9,746



97,136



62,540







1,497



(170,919
)


Disposals or write-offs


(2,617
)


(5,838
)


(3,842
)


(503
)


(3,107
)


(11,614
)


(27,521
)Currency translation differences


(415
)


(3,944
)


(402
)


(127
)


(143
)


(626
)


(5,657
)At end of the year


110,910



888,849



452,564



20,184



11,051



225,479



1,709,037Accumulated depreciation and impairmentAt beginning of the year


(27,710
)


(317,301
)


(196,842
)


(8,536
)


(5,723
)


(265
)


(556,377
)Charge for the year


(5,614
)


(57,088
)


(24,988
)


(1,657
)


(1,012
)


(11
)


(90,370
)Disposals or write-offs or transfers


1,087



3,455



3,363



378



2,873







11,156Currency translation differences


124



1,497



179



83



137



1



2,021At end of the year


(32,113
)


(369,437
)


(218,288
)


(9,732
)


(3,725
)


(275
)


(633,570
)Net book valueAt end of the year


78,797



519,412



234,276



10,452



7,326



225,204



1,075,467         2010

2009

2008RMB

RMB

RMBAt beginning of the year


17,221



15,853



11,975Additions to capitalised exploratory well costs pending the
    determination of proved reserves


25,239



22,891



26,503Reclassified to wells, facilities, and equipment based on the
    determination of proved reserves


(11,395
)


(11,504
)


(12,284
)Capitalised exploratory well costs charged to expense


(10,714
)


(10,019
)


(10,341
)At end of the year


20,351



17,221



15,853  F-25




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    December 31, 2010

December 31, 2009RMB

RMBOne year or less


18,900



15,560Over one year


1,451



1,661Balance at December 31


20,351



17,221     17  INVESTMENTS
    IN ASSOCIATES AND JOINTLY CONTROLLED ENTITIES
    Country of









Interest

Type ofName

Incorporation

Assets

Liabilities

Revenues

Profit

Held %

ShareRMB

RMB

RMB

RMBAs of or for the year ended December 31, 2010:Dalian West Pacific Petrochemical Co., Ltd.


PRC



10,373



11,258



35,704



1,160



28.44



ordinaryChina Marine Bunker (PetroChina) Co., Ltd.


PRC



8,039



5,210



37,552



388



50.00



ordinaryChina Petroleum Finance Co., Ltd.(a)


PRC



460,387



438,218



10,339



3,294



49.00



ordinaryArrow Energy Holdings Pty Ltd.(b)


Australia



48,299



13,370



387



342



50.00



ordinaryAs of or for the year ended December 31, 2009:Dalian West Pacific Petrochemical Co., Ltd.


PRC



10,168



12,228



28,205



1,076



28.44



ordinaryChina Marine Bunker (PetroChina) Co., Ltd.


PRC



6,546



3,501



27,510



358



50.00



ordinary     (a)
    
    In 2010, the Company paid a cash consideration of RMB 9,618 for
    subscription of new registered capital of RMB 2,441 in China
    Petroleum Finance Co., Ltd. (CP Finance). The
    balance of RMB 7,177 was accounted into the capital reserve of
    CP Finance. The shareholding of the Company in CP Finance
    increased from 7.5% to 49.0%. CP Finance is recorded using the
    equity method of accounting in the Companys financial
    statements.(b)
    
    In 2010, CS CSG (Australia) Pty Ltd. (the Joint Venture
    Company) was formed as a joint venture company by
    PetroChina International Investment Company Limited (a
    wholly-owned subsidiary of the Group) and Shell Energy Holdings
    Australia Ltd.. PetroChina International Investment Company
    Limited holds 50% equity interest in the Joint Venture Company.On August 23, 2010, the Joint Venture Company acquired 100%
    equity interest in Arrow Energy Limited for a total
    consideration of approximately 3.5 billion Australian
    Dollars (AUD) (approximately RMB
    21,120 million), representing AUD4.70 per share of Arrow
    Energy in cash. The Joint Venture Company has now been renamed
    as Arrow Energy Holdings Pty Ltd. F-26




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      18
    AVAILABLE-FOR-SALE
    FINANCIAL ASSETS  December 31, 2010

December 31, 2009RMB

RMBAvailable-for-sale
    financial assets


2,330



2,799Less: Impairment losses


(351
)


(456
)1,979



2,343   Available-for-sale
  available-for-sale
  19
    SUBSIDIARIES    Paid-up



AttributableCountry of

Capital

Type of

EquityCompany Name

Incorporation

RMB

Legal Entity

Interest %

Principal ActivitiesDaqing Oilfield Company Limited

PRC


47,500


Limited liability
    company


100.00


Exploration, production and sale of crude oil and natural gasCNPC Exploration and Development Company Limited

PRC


16,100


Limited liability 
    company


50.00


Exploration, production and sale of crude oil and natural gas in
    and outside the PRCPetroChina Hong Kong Limited

Hong Kong


HK Dollar 
    7,592


Limited liability 
    company


100.00


Investment holding. The principal activities of its
    subsidiaries, associates and jointly controlled entities are the
    exploration, production and sale of crude oil and natural gas in
    and outside the PRCPetrochina International Investment Company Limited

PRC


31,314


Limited liability 
    company


100.00


Investment holding. The principal activities of its subsidiaries
    and jointly controlled entities are the exploration, development
    and production of crude oil, oilsands and coalbed methane
    outside the PRC  F-27




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  20
    ADVANCE
    OPERATING LEASE PAYMENTS  December 31, 2010

December 31, 2009RMB

RMBLand use rights


24,085



19,901Advance lease payments


12,070



10,33536,155



30,236   sub-leased
  21
    INTANGIBLE
    AND OTHER ASSETS  December 31, 2010

December 31, 2009Accumulated





AccumulatedCost

Amortisation

Net

Cost

Amortisation

NetRMB

RMB

RMB

RMB

RMB

RMBPatents


3,237



(2,111
)


1,126



3,076



(1,939
)


1,137Technical know-how


1,757



(396
)


1,361



1,654



(242
)


1,412Goodwill(i)


3,068







3,068



2,818







2,818Other


14,431



(3,965
)


10,466



11,025



(2,992
)


8,033Intangible assets


22,493



(6,472
)


16,021



18,573



(5,173
)


13,400Other assets










9,432











4,61725,453











18,017     (i)
    
    The goodwill primarily relates to the acquisition of Singapore
    Petroleum Company Limited in 2009.    22
    INVENTORIES  December 31,

December 31,2010

2009RMB

RMBCrude oil and other raw materials


39,574



30,928Work in progress


13,652



7,006Finished goods


82,353



77,685Spare parts and consumables


31



28135,610



115,647Less: Write down in inventories


(722
)


(866
)134,888



114,781    F-28




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  23
    ACCOUNTS
    RECEIVABLE  December 31,

December 31,2010

2009RMB

RMBAccounts receivable


46,057



30,909Less: Provision for impairment of receivables


(1,052
)


(2,124
)45,005



28,785     December 31,

December 31,2010

2009RMB

RMBWithin 1 year


44,689



28,561Between 1 and 2 years


177



106Between 2 and 3 years


45



80Over 3 years


94



3845,005



28,785       2010

2009

2008RMB

RMB

RMBAt beginning of the year


2,124



2,423



2,880Provision for impairment of accounts receivable


9



38



36Receivables written off as uncollectible


(1,007
)


(232
)


(388
)Reversal of provision for impairment of accounts receivable


(74
)


(105
)


(105
)At end of the year


1,052



2,124



2,423   24
    PREPAID
    EXPENSES AND OTHER CURRENT ASSETS  December 31,

December 31,2010

2009RMB

RMBOther receivables


8,670



8,528Advances to suppliers


37,454



36,00946,124



44,537Less: Provision for impairment


(2,847
)


(3,741
)43,277



40,796Value-added tax recoverable


7,678



15,663Prepaid expenses


495



421Other current assets


372



2,71551,822



59,595  F-29




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    25
    NOTES RECEIVABLE    26
    CASH AND
    CASH EQUIVALENTS    27
    ACCOUNTS
    PAYABLE AND ACCRUED LIABILITIES  December 31,

December 31,2010

2009RMB

RMBTrade payables


97,361



62,840Advances from customers


29,099



21,193Salaries and welfare payable


5,696



5,105Accrued expenses


332



31Dividends payable by subsidiaries to non-controlling shareholders


199



105Interest payable


2,545



1,448Construction fee and equipment cost payables


111,654



93,920Other payables


23,305



20,097270,191



204,739       December 31,

December 31,2010

2009RMB

RMBWithin 1 year


93,240



60,420Between 1 and 2 years


2,951



1,404Between 2 and 3 years


475



505Over 3 years


695



51197,361



62,840  F-30




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  28
    BORROWINGS  December 31,

December 31,2010

2009RMB

RMBShort-term borrowings excluding current portion of long-term
    borrowings


97,175



134,622Current portion of long-term borrowings


5,093



14,229102,268



148,851Long-term borrowings


131,352



85,471233,620



234,322       December 31,

December 31,2010

2009RMB

RMBTotal borrowings: interest free


47



51 at fixed rates


186,674



163,155 at floating rates


46,899



71,116233,620



234,322Weighted average effective interest rates: bank loans


3.32
%


3.10
% corporate debentures


4.08
%


4.31
% medium-term notes


3.48
%


2.78
% short-term notes






2.01
% other loans


3.53
%


3.21
%     December 31,

December 31,2010

2009RMB

RMBRMB


201,470



195,023US Dollar


28,253



39,097Other currency


3,897



202233,620



234,322    F-31




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      December 31,

December 31,2010

2009RMB

RMBWithin one year


110,380



155,450Between one and two years


41,533



14,649Between two and five years


82,640



67,108After five years


26,642



14,806261,195



252,013   29  SHARE
    CAPITAL
  December 31,

December 31,2010

2009RMB

RMBRegistered, issued and fully paid:A shares


161,922



161,922H shares


21,099



21,099183,021



183,021            F-32




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      30  RESERVES
  2010

2009RMB

RMBCapital Reserve(a)Beginning balance


133,308



133,308Ending balance


133,308



133,308Statutory Common Reserve Fund(b)Beginning balance


125,447



115,466Transfer from retained earnings


13,190



9,981Ending balance


138,637



125,447Special Reserve-Safety Fund ReserveBeginning balance


8,075



6,750Safety fund reserve


416



1,325Ending balance


8,491



8,075Currency translation differencesBeginning balance


(4,186
)


(2,726
)Currency translation differences


3,089



(1,460
)Ending balance


(1,097
)


(4,186
)Other reservesBeginning balance


(22,509
)


(23,382
)Purchase of non-controlling interest in subsidiaries


(87
)


(179
)Acquisition of subsidiaries


(572
)


(248
)Fair value gain on
    available-for-sale
    financial assets


105



140Capital contribution from non-controlling interest


3



1,158Other


338



2Ending balance


(22,722
)


(22,509
)256,617



240,135     (a)
    
    The Groups revaluation reserve of RMB 79,946 has been
    reclassified to capital reserve as the Group has changed its
    accounting policy for property, plant and equipment upon the
    adoption of IFRS 1 (amendment) (Note 3(f)).(b)
    
    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. F-33




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   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.(c)
    
    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, 2010,
    the Companys distributable reserve amounted to RMB 425,345
    (December 31, 2009: RMB 358,415).  31  DEFERRED
    TAXATION
      Year Ended December 31,2010

2009

2008RMB

RMB

RMBAt beginning of the year


21,160



11,969



20,571Transfer to profit and loss (Note 12)


(104
)


8,611



(8,212
)Charge/ (credit) to other comprehensive income


5



38



(67
)Acquisition of subsidiaries


87



991



Currency translation differences


(61
)


(420
)


(364
)Others


144



(29
)


41At end of the year


21,231



21,160



11,969     December 31,

December 312010

2009RMB

RMBDeferred tax assets:Current:Receivables and inventories


8,251



7,173Tax losses of subsidiaries


352



166Non-current:Impairment of long-term assets


4,665



3,983Other


3,742



2,379Total deferred tax assets


17,010



13,701Deferred tax liabilities:Non-current:Accelerated tax depreciation


35,164



32,348Other


3,077



2,513Total deferred tax liabilities


38,241



34,861Net deferred tax liabilities


21,231



21,160  F-34




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    December 31,

December 31,2010

2009RMB

RMBDeferred tax assets


284



289Deferred tax liabilities


21,515



21,449     32  ASSET
    RETIREMENT OBLIGATIONS
  2010

2009

2008RMB

RMB

RMBAt beginning of the year


44,747



36,262



24,761Liabilities incurred


13,736



7,162



10,033Liabilities settled


(469
)


(434
)


(169
)Accretion expense (Note 10)


2,382



1,943



1,746Currency translation differences


(32
)


(186
)


(109
)At end of the year


60,364



44,747



36,262     33  PENSIONS
    34  CONTINGENT
    LIABILITIES
  (a)
    Bank
    and other guarantees    (b)
    Environmental
    liabilities    (c)
    Legal
    contingencies    (d)
    Group
    insurance   F-35




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    35  COMMITMENTS
  (a)
    Operating
    lease commitments    December 31,

December 31,2010

2009RMB

RMBNo later than one year


4,118



4,071Later than one year and no later than five years


13,172



12,478Later than five years


77,552



77,38594,842



93,934   (b)
    Capital
    commitments    (c)
    Exploration
    and production licenses      December 31,

December 31,2010

2009RMB

RMBWithin one year


1,000



1,000Between one and two years


1,000



1,000Between two and three years


1,000



1,000Between three and four years


1,000



1,000Between four and five years


1,000



1,000  F-36




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  36  MAJOR
    CUSTOMERS
    2010

2009

2008Percentage



Percentage



Percentageof Total



of Total



of TotalRevenue

Revenue

Revenue

Revenue

Revenue

RevenueRMB

%

RMB

%

RMB

%China Petroleum & Chemical Corporation


86,270



6



67,137



7



57,594



5CNPC and its fellow subsidiaries


49,259



3



32,437



3



46,645



4135,529



9



99,574



10



104,239



9   37  RELATED
    PARTY TRANSACTIONS
      (a)
    Transactions
    with CNPC and its fellow subsidiaries, associates and jointly
    controlled entities        
    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 62,459 in the year
    ended December 31, 2010 (2009: RMB 37,448, 2008: RMB
    51,714).
    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 9,184 in the year ended December 31, 2010
    (2009: RMB 7,128, 2008: RMB 9,300). F-37




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   
    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 241,852
    in the year ended December 31, 2010 (2009: RMB 199,826,
    2008: RMB 204,670).
    Purchase of assets principally represent the purchases of
    manufacturing equipment, office equipment and transportation
    equipment, etc. The total amount of these transactions amounted
    to RMB 4,782 in the year ended December 31, 2010 (2009: RMB
    2,327, 2008: RMB 3,576).
    Amounts due from and to CNPC and its fellow subsidiaries,
    associates and jointly controlled entities of the Group included
    in the following accounts captions are summarised as follows:  December 31,

December 31,2010

2009RMB

RMBAccounts receivable


11,633



3,780Prepayments and other receivables


22,780



16,548Accounts payable and accrued liabilities


70,272



57,076   
    Interest income represents interests from deposits placed with
    CNPC and its fellow subsidiaries. The total interest income
    amounted to RMB 207 in the year ended December 31, 2010
    (2009: RMB 143, 2008: RMB 114). The balance of deposits at
    31 December 2010 was RMB 7,677 million
    (December 31, 2009: RMB 10,433 million).
    Purchases of financial service principally represents interest
    charged on the loans from CNPC and its fellow subsidiaries,
    insurance fee, etc. The total amount of these transactions
    amounted to RMB 3,492 in the year ended December 31, 2010
    (2009: RMB 3,541, 2008: RMB 1,623).
    The borrowings from CNPC and its fellow subsidiaries at
    31 December 2010 were RMB 75,417 million
    (December 31, 2009: RMB 81,753 million).     F-38




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  (b)
    Key
    management compensation  Year End December 312010

2009

2008RMB000

RMB000

RMB000Emoluments and other benefits


12,743



9,885



10,581Contribution to retirement benefit scheme


606



479



44413,349



10,364



11,025     Note:
    Emoluments set out above exclude RMB6.45 million paid to
    directors and other key management of the Company as part of the
    deferred merit pay for years 2007 to 2009 in accordance with
    relevant requirements by the PRC government.  (c)
    Transactions
    with other state-controlled entities in the PRC    
    Sales and purchases of goods and services,
    Purchases of assets,
    Lease of assets; and
    Bank deposits and borrowings    38  SEGMENT
    INFORMATION
               F-39




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Year Ended December 31, 2010Exploration

Refining



Naturaland

and



Gas andProduction

Chemicals

Marketing

Pipeline

Other

TotalRMB

RMB

RMB

RMB

RMB

RMBTurnover


544,884



664,773



1,134,534



117,043



1,606



2,462,840Less: intersegment sales


(414,774
)


(508,599
)


(61,987
)


(11,601
)


(464
)


(997,425
)Turnover from external customers


130,110



156,174



1,072,547



105,442



1,142



1,465,415Depreciation, depletion and amortisation


(75,991
)


(16,302
)


(8,232
)


(11,613
)


(1,071
)


(113,209
)Profit/(loss) from operations


153,703



7,847



15,956



20,415



(10,144
)


187,777Finance costs:Exchange gain






















1,685Exchange loss






















(2,857
)Interest income






















1,983Interest expense






















(6,321
)Total net finance costs






















(5,510
)Share of profit of associates and jointly controlled entities


5,346



39



678



10



965



7,038Profit before income tax expense






















189,305Income tax expense






















(38,513
)Profit for the year






















150,792Segment assets


880,575



299,808



252,789



260,269



1,210,132



2,903,573Other assets






















284Investments in associates and jointly controlled entities


45,533



571



6,700



122



11,211



64,137Elimination of intersegment balances(a)






















(1,311,507
)Total assets






















1,656,487Segment capital expenditure


160,893



44,242



15,793



53,648



1,636



276,212Segment liabilities


327,765



119,190



144,293



132,290



421,319



1,144,857Other liabilities






















78,792Elimination of intersegment balances(a)






















(577,291
)Total liabilities






















646,358   F-40




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Year Ended December 31, 2009Exploration

Refining



Naturaland

and



Gas andProduction

Chemicals

Marketing

Pipeline

Other

TotalRMB

RMB

RMB

RMB

RMB

RMBTurnover


405,326



501,300



768,295



77,658



1,372



1,753,951Less: intersegment sales


(308,649
)


(381,522
)


(35,489
)


(8,756
)


(260
)


(734,676
)Turnover from external customers


96,677



119,778



732,806



68,902



1,112



1,019,275Depreciation, depletion and amortisation


(64,595
)


(11,824
)


(7,088
)


(7,694
)


(1,058
)


(92,259
)Profit/ (loss) from operations


105,019



17,308



13,265



19,046



(11,194
)


143,444Finance costs:Exchange gain






















552Exchange loss






















(1,335
)Interest income






















1,459Interest expense






















(5,272
)Total net finance costs






















(4,596
)Share of profit of associates and jointly controlled entities


590



53



519



8



14



1,184Profit before income tax expense






















140,032Income tax expense






















(33,473
)Profit for the year






















106,559Segment assets


756,122



256,040



237,534



198,774



1,095,827



2,544,297Other assets






















289Investments in associates and jointly controlled entities


22,183



579



5,393



68







28,223Elimination of intersegment balances(a)






















(1,122,521
)Total assets






















1,450,288Segment capital expenditure and acquisition Capital expenditure


129,017



42,558



18,174



74,754



2,333



266,836 Acquisition










15,296











15,296282,132Segment liabilities


280,573



98,590



142,254



92,538



357,107



971,062Other liabilities






















56,412Elimination of intersegment balances(a)






















(484,887
)Total liabilities






















542,587   F-41




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Year Ended December 31, 2008Exploration

Refining



Naturaland

and



Gas andProduction

Chemicals

Marketing

Pipeline

Other

TotalRMB

RMB

RMB

RMB

RMB

RMBTurnover


626,367



560,729



778,141



63,315



1,418



2,029,970Less: intersegment sales


(500,522
)


(396,410
)


(53,557
)


(6,706
)


(171
)


(957,366
)Turnover from external customers


125,845



164,319



724,584



56,609



1,247



1,072,604Depreciation, depletion and amortisation


(58,927
)


(22,796
)


(5,871
)


(6,310
)


(855
)


(94,759
)Profit/(loss) from operations


240,470



(93,830
)


7,982



16,057



(11,108
)


159,571Finance costs:Exchange gain






















1,774Exchange loss






















(2,855
)Interest income






















2,277Interest expense






















(3,044
)Total net finance costs






















(1,848
)Share of profit/(loss) of associates and jointly controlled
    entities


4,561



(609
)


314



5



19



4,290Profit before income tax expense






















162,013Income tax expense






















(35,211
)Profit for the year






















126,802Segment assets


662,454



290,758



197,950



121,368



973,128



2,245,658Other assets






















497Investments in associates and jointly controlled entities


24,021



1,686



3,074



20



49



28,850Elimination of intersegment balances(a)






















(1,078,770
)Total assets






















1,196,235Segment capital expenditure


157,194



30,619



4,974



36,848



2,742



232,377Segment liabilities


264,230



70,879



132,340



53,294



334,972



855,715Other liabilities






















27,667Elimination of intersegment balances(a)






















(534,987
)Total liabilities






















348,395  F-42




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
  NOTES TO
    THE CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Geographical
    information
  Year Ended December 31,Turnover

Non-Current Assets(b)2010

2009

2008

2010

2009

2008RMB

RMB

RMB

RMB

RMB

RMBMainland China


1,086,909



790,748



824,703



1,231,536



1,073,865



902,370Other


378,506



228,527



247,901



132,808



78,078



63,8781,465,415



1,019,275



1,072,604



1,364,344



1,151,943



966,248     (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.  39  EVENTS
    AFTER THE REPORTING PERIOD
        40  APPROVAL
    OF FINANCIAL STATEMENTS
   F-43




---



##### Table of Contents



PETROCHINA
    COMPANY LIMITED
    SUPPLEMENTARY INFORMATION ON OIL AND GAS PRODUCING
    ACTIVITIES (UNAUDITED)

(Amounts in millions unless otherwise stated)



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 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.



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.



The Other geographic area includes oil and gas
    producing activities principally in countries such as
    Kazakhstan, Venezuela 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 are presented in the aggregate.



Proved
    Oil and Gas Reserve Estimates



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 judgment. 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 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
    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.



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.



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.


F-44




---



##### Table of Contents



Crude



TotalOil and

Natural

AllCondensate

Gas

Products(Millions of

(Billions of

(Million barrels ofbarrels)

cubic feet)

oil equivalent)Proved developed and undeveloped reservesThe GroupReserves at December 31, 2007


11,706



57,111



21,224Changes resulting from:Revisions of previous estimates


(574
)


(637
)


(680
)Improved recovery


75







75Extensions and discoveries


885



6,579



1,982Production


(871
)


(1,864
)


(1,181
)Reserves at December 31, 2008


11,221



61,189



21,420Changes resulting from:Revisions of previous estimates


(192
)


(1,273
)


(405
)Improved recovery


73







73Extensions and discoveries


1,005



5,440



1,911Production


(844
)


(2,112
)


(1,196
)Reserves at December 31, 2009


11,263



63,244



21,803Changes resulting from:Revisions of previous estimates


(78
)


(1,456
)


(320
)Improved recovery


74







74Extensions and discoveries


877



5,936



1,866Production


(858
)


(2,221
)


(1,228
)Reserves at December 31, 2010


11,278



65,503



22,195Proved developed reserves at:December 31, 2008


8,324



26,667



12,769December 31, 2009


7,871



30,949



13,029December 31, 2010


7,605



31,102



12,789Proved undeveloped reserves at:December 31, 2008


2,897



34,522



8,651December 31, 2009


3,392



32,295



8,774December 31, 2010


3,673



34,401



9,406Equity method investmentsShare of proved developed and undeveloped reserves of associates
    and jointly controlled entitiesDecember 31, 2008


372



65



383December 31, 2009


310



50



319December 31, 2010


337



37



343    F-45




---



##### Table of Contents



Capitalised
    Costs
  December 31,

December 31,2010

2009RMB

RMBThe GroupProperty costs and producing assets


777,461



666,644Support facilities


247,475



222,205Construction-in-progress


75,343



61,581Total capitalised costs


1,100,279



950,430Accumulated depreciation, depletion and amortisation


(434,501
)


(369,437
)Net capitalised costs


665,778



580,993Equity method investmentsShare of net capitalised costs of associates and jointly
    controlled entities


33,120



13,020   Costs
    Incurred for Property Acquisitions, Exploration and Development
    Activities
  2010Mainland China

Other

TotalRMB

RMB

RMBThe GroupProperty acquisition and exploration costs


37,442



2,777



40,219Development costs


113,673



13,433



127,106Total


151,115



16,210



167,325Equity method investmentsShare of costs of property acquisition, exploration and
    development of associates and jointly controlled entities






2,615



2,615   F-46




---



##### Table of Contents



2009Mainland China

Other

TotalRMB

RMB

RMBThe GroupProperty acquisition and exploration costs


29,786



2,949



32,735Development costs


94,130



5,977



100,107Total


123,916



8,926



132,842Equity method investmentsShare of costs of property acquisition, exploration and
    development of associates and jointly controlled entities






1,620



1,620   2008Mainland China

Other

TotalRMB

RMB

RMBThe GroupProperty acquisition and exploration costs


34,773



2,895



37,668Development costs


117,772



7,083



124,855Total


152,545



9,978



162,523Equity method investmentsShare of costs of property acquisition, exploration and
    development of associates and jointly controlled entities






4,003



4,003   Results
    of Operations for Oil and Gas Producing Activities
  2010Mainland China

Other

TotalRMB

RMB

RMBThe GroupSales and other operating revenuesSales to third parties


82,433



47,677



130,110Intersegment sales


346,421



742



347,163428,854



48,419



477,273Production costs excluding taxes


(76,329
)


(4,648
)


(80,977
)Exploration expenses


(21,368
)


(1,595
)


(22,963
)Depreciation, depletion and amortisation


(63,569
)


(5,133
)


(68,702
)Taxes other than income taxes


(66,798
)


(11,766
)


(78,564
)Accretion expense


(2,238
)


(144
)


(2,382
)Income taxes


(39,510
)


(6,284
)


(45,794
)Results of operations from producing activities


159,042



18,849



177,891Equity method investmentsShare of profit for producing activities of associates and
    jointly controlled entities






6,447



6,447Total of the Group and equity method investments results of
    operations for producing activities


159,042



25,296



184,338   F-47




---



##### Table of Contents



2009Mainland China

Other

TotalRMB

RMB

RMBThe GroupSales and other operating revenuesSales to third parties


62,799



33,878



96,677Intersegment sales


259,847



404



260,251322,646



34,282



356,928Production costs excluding taxes


(68,236
)


(4,355
)


(72,591
)Exploration expenses


(18,426
)


(972
)


(19,398
)Depreciation, depletion and amortisation


(53,018
)


(4,005
)


(57,023
)Taxes other than income taxes


(31,210
)


(9,660
)


(40,870
)Accretion expense


(1,787
)


(156
)


(1,943
)Income taxes


(30,196
)


(3,783
)


(33,979
)Results of operations from producing activities


119,773



11,351



131,124Equity method investmentsShare of profit for producing activities of associates and
    jointly controlled entities






3,326



3,326Total of the Group and equity method investments results of
    operations for producing activities


119,773



14,677



134,450   2008Mainland China

Other

TotalRMB

RMB

RMBThe GroupSales and other operating revenuesSales to third parties


72,218



52,169



124,387Intersegment sales


431,203



2,181



433,384503,421



54,350



557,771Production costs excluding taxes


(69,469
)


(5,410
)


(74,879
)Exploration expenses


(20,868
)


(1,011
)


(21,879
)Depreciation, depletion and amortisation


(47,295
)


(3,532
)


(50,827
)Taxes other than income taxes


(99,970
)


(5,843
)


(105,813
)Accretion expense


(1,607
)


(139
)


(1,746
)Income taxes


(52,718
)


(9,604
)


(62,322
)Results of operations from producing activities


211,494



28,811



240,305Equity method investmentsShare of profit for producing activities of associates and
    jointly controlled entities






9,872



9,872Total of the Group and equity method investments results of
    operations for producing activities


211,494



38,683



250,177  F-48




---



##### Table of Contents



Standardised
    Measure of Discounted Future Net Cash Flows
    RMBThe GroupAt December 31, 2010Future cash inflows from sales of oil and gas


6,845,504Future production costs


(2,576,816
)Future development costs


(571,065
)Future income tax expense


(819,039
)Future net cash flows


2,878,584Discount at 10% for estimated timing of cash flows


(1,560,391
)Standardised measure of discounted future net cash flows


1,318,193   RMBThe GroupAt December 31, 2009Future cash inflows from sales of oil and gas


5,045,994Future production costs


(1,628,794
)Future development costs


(479,912
)Future income tax expense


(615,290
)Future net cash flows


2,321,998Discount at 10% for estimated timing of cash flows


(1,244,183
)Standardised measure of discounted future net cash flows


1,077,815   RMBThe GroupAt December 31, 2008Future cash inflows from sales of oil and gas


4,426,893Future production costs


(1,521,416
)Future development costs


(381,498
)Future income tax expense


(522,158
)Future net cash flows


2,001,821Discount at 10% for estimated timing of cash flows


(1,046,896
)Standardised measure of discounted future net cash flows


954,925       December 31, 2010


34,729December 31, 2009


26,457December 31, 2008


17,912  F-49




---



##### Table of Contents



Changes
    in Standardised Measure of Discounted Future Net Cash
    Flows
    Year Ended December 312010

2009

2008RMB

RMB

RMBThe GroupBeginning of the year


1,077,815



954,925



1,822,070Sales and transfers of oil and gas produced, net of production
    costs


(316,888
)


(242,363
)


(375,269
)Net changes in prices and production costs and other


356,503



171,170



(1,448,443
)Extensions, discoveries and improved recovery


179,765



150,846



139,058Development costs incurred


7,713



(8,488
)


67,673Revisions of previous quantity estimates


(28,773
)


(31,516
)


(46,105
)Accretion of discount


136,401



120,396



260,643Net change in income taxes


(94,343
)


(37,155
)


535,298End of the year


1,318,193



1,077,815



954,925  F-50