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PetroChina

As its name suggests, PetroChina Company Ltd is the listed arm of state-owned China National Petroleum Corporation (CNPC). It is China's biggest oil producer, and is listed in Hong Kong, New York, and Shanghai.

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ENERGY

Graft probe claims another Kunlun chairman

Natural gas firm loses second chairman to widening mainland investigation, with former Politburo member said to be the next target

PUBLISHED : Tuesday, 17 December, 2013, 6:13pm
UPDATED : Wednesday, 18 December, 2013, 6:33am

PetroChina's natural gas distribution subsidiary Kunlun Energy has lost its second chairman in less than four months, amid wider anti-corruption probes into senior managers at the state-controlled oil and gas giant.

Wen Qingshan, who descended into Kunlun from ultimate parent China National Petroleum Corp (CNPC) in late August to succeed Li Hualin as chairman, had resigned "due to personal matters", Kunlun said in a statement. Li was under investigation by "the relevant authority in China", Kunlun said in late August.

Hopefully this will be the last round of top management reshuffling
ANALYST AT A EUROPEAN BROKERAGE

Trading of Kunlun's shares was halted yesterday and resumes today. They closed at HK$14.18 on Monday, up 12.7 per cent from when Li resigned. The stock is down 15 per cent since the start of the year, compared with a 1 per cent fall in the Hang Seng Index. Wen, CNPC's chief accountant in addition to his role at Kunlun, had been "summoned to assist the investigation" into "the CNPC corruption case" in recent days, the influential finance portal Caixin.com reported on Monday, citing a source at CNPC.

PetroChina yesterday also said Wen has resigned from his position as a supervisor due to "personal matters".

CNPC is the parent of PetroChina, which controls Kunlun. Both PetroChina and Kunlun are listed in Hong Kong.

Neither Kunlun's nor PetroChina's announcement said whether Wen was assisting any investigation into allegations against him or other executives.

A person familiar with the situation said this is because "more information is needed to support such a statement", adding the State-owned Assets Supervision and Administration Commission has made no such statement.

Kunlun only announced Li was being probed in August after Sasac announced it, the source said, adding an executive from PetroChina would be appointed to succeed Wen within days.

Wen's stepping down comes close on the heels of another top-level executive reshuffle. Jiang Changliang early this month resigned as Kunlun's chief executive, after a little over two years in the position, due to a transfer of duties to an unspecified unit of PetroChina. He was succeeded by a CNPC executive.

CNPC, PetroChina and Kunlun have lost at least five senior executives since late August amid the graft probes. Leaders in state firms of other industries also faced investigations after President Xi Jinping launched an anti-corruption drive.

Wen was promoted to chief accountant at CNPC in July this year, after being its deputy chief accountant for almost six years.

CNPC is a power base of Zhou Yongkang, a former Politburo Standing Committee member and ex-security tsar. Speculation is rife that he will soon be named as the focus of an official graft investigation.

Several of Zhou's former aides are now under investigation, including Li, CNPC ex-chairman Jiang Jiemin, and Guo Yongxiang, a former deputy governor of Sichuan province who worked alongside Zhou for 12 years until 2002. Zhou himself was also a CNPC chairman in the 1990s.

"The fact that Wen was appointed to head up Kunlun to replace Li shows that PetroChina's people had no idea who would be the next target of investigation," said an analyst at a European brokerage.

"Hopefully this will be the last round of top management reshuffling as Beijing seems to be closing in on Zhou after taking down his allies."

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