China National Offshore Oil Corp, the parent of listed offshore oil and gas producer CNOOC, posted a 35.2 per cent year-on-year growth in net profit to 18.95 billion yuan (HK$21.71 billion) for the first half on the back of higher oil prices. Operating profit was 41.37 billion yuan for the first six months, up 47.2 per cent from the same period last year, China National said on its website. The results of unlisted state firms are based on mainland accounting standards. Turnover surged 48 per cent to 106.33 billion yuan, while operating costs jumped 52.9 per cent. Total oil and gas output rose 2.4 per cent to 20.70 million tonnes of oil equivalent in the first half. Average Brent benchmark oil futures jumped 71.6 per cent year on year in this year's first half to US$109.13 a barrel. Analysts expected listed CNOOC to provide the lion's share of China National's profit. CLSA's head of China energy research, Gordon Kwan, estimated that CNOOC would report a 34 per cent year-on-year growth in net profit to 19.5 billion yuan, based on international accounting standards and assuming its realised oil price was 10 per cent lower than the Brent price. A company spokesman said both upstream and downstream businesses saw profits improve. Downstream operations mainly came from its 45 per cent held US$4.3 billion joint venture petrochemical complex with Royal Dutch/Shell in Huizhou, Guangdong, fertiliser projects on Hainan Island and fast growth in bitumen and fuel oil sales. The firm's wholly owned 21.6 billion yuan refinery next to the petrochemical plant, its first refinery, is slated to come on stream in September. If the central government continues to control retail fuel prices at below international levels and if crude oil prices remain high, the spokesman said the firm was likely to join the refineries of rivals PetroChina and China Petroleum & Chemical in incurring losses, even though they would be partly mitigated by subsidies.