PetroChina says graft report not accurate

Trading in shares of energy giant briefly halted after newspaper says five executives were taken away as part of an investigation into corruption

PUBLISHED : Monday, 09 September, 2013, 11:10am
UPDATED : Tuesday, 10 September, 2013, 3:10am

Trading in PetroChina shares resumed yesterday afternoon after being halted in the morning following a mainland newspaper report that five of its executives had been taken away as part of an corruption investigation.

The oil company dismissed the report by China Business News yesterday as "inaccurate". Its shares closed 1.3 per cent higher, at HK$8.81, compared to a 0.6 per cent rise of the Hang Seng Index.

The report said among the five taken away on Thursday were PetroChina vice-president Sun Longde and director Wang Guoliang . It cited an unidentified source close to the company's parent, China National Petroleum Corporation (CNPC), of which Wang is a board member.

The paper said it was not clear whether the five were themselves being investigated or were assisting ongoing investigations.

The oil company issued a statement denying Sun and Wang were the subject of an investigation, saying the pair "continue to perform their duties at the company as usual". But the wording left open the possibility the men could be assisting an inquiry.

The statement also avoided saying whether the three other officials mentioned in the article, including Wu Mei , head of a CNPC department overseeing strategic planning, were taken away or under investigation.

The news came as investigators have widened their probe into the state-owned oil industry in recent weeks to include a number of prominent former and incumbent CNPC officials.

Jiang Jiemin , director of the State-owned Assets Supervision and Administration Commission or Sasac, and a former CNPC chairman, was placed under investigation for serious discipline violations late last month.

The inquiry targeting Jiang, the head of a State Council agency overseeing 100 leading state-owned firms, came just days after authorities announced similar investigations into four senior CNPC officials, including deputy general manager Wang Yongchun , a former aide of Jiang at CNPC.

The corruption investigation at CNPC is believed to be part of the anti-graft campaign launched by the new leadership under President Xi Jinping , who has vowed to come down hard on corrupt officials no matter whether they are "tigers" in prominent posts or small "flies".

The China Business News report has further shed light on the "Shengli Gang", a group of senior officials who cultivated powerful networks during the early years of their careers at the Shengli Oilfield in Shandong , once the second-largest oilfield on the mainland.

Beginning in 1972, Jiang spent more than two decades at the Shengli Oilfield and eventually became deputy director of the Shengli Oilfield Company.

He rose through the ranks of the oil and gas industry to become CNPC chairman in 2006 and was appointed as head of Sasac in March.

Sun, the PetroChina vice-president, spent more than 14 years at Shengli Oilfield, until 1997. He was later transferred to a more prominent post at the Talimu Oilfield in Xinjiang.