PetroChina seeks to raise 150 billion yuan ($22 billion) to improve cash flow

07 May 2009

PetroChina Co said it needs to raise 150 billion yuan ($22 billion) in funds this year to finance its working operations, investment activities and for likely increased tax payments.

The company issued the first tranche of the medium-term notes amounting to RMB15 billion in January 2009 followed by a second tranche of RMB15 billion March 2009 for a similar term of three years.

In March, the board approved the issuance of debt financing instruments of RMB100 billion, which will be put up for approval at the shareholders' annual general meeting to be held on May 12, 2009.

The company's free cash flow declined by 76.9 billion yuan last year because of tax payments and investments, the company said in a statement to the Shanghai Stock Exchange.

PetroChina had negative free cash flow of 44.9 billion yuan in 2008, according to the statement.

The money thus raised will be partly utilised to pay $1.4 billion for its stake in a Kazakh oil company, chairman Jiang Jiemin said on April 16. (See: CNPC to buy 49 per cent in Kazakh oil major for $10 billion).