London Daily

Focus on the big picture.
Thursday, Sep 11, 2025

PetroChina may sell Australian, Canadian assets to stem losses

PetroChina may sell Australian, Canadian assets to stem losses

PetroChina may sell out from natural gas projects in Australia and oil sands in Canada to stem losses and divert funds to more lucrative sites in the Middle East, Africa and central Asia, two people with knowledge of the matter said.

PetroChina's plan follows a similar strategic shift by smaller state peer CNOOC Ltd (0883.HK), which was preparing to exit its operations in Britain, Canada and the United States because of concerns the assets could become subject to Western sanctions.

The sales follow an internal review of PetroChina's global portfolio that began last year, the two sources said, declining to be named as the discussions are not public.

Unlike CNOOC's sales, PetroChina's divestitures are driven more by the assets' disappointing economics than any fear of U.S. sanctions as it does not own any oil and gas assets in the United States, though political strains with Australia and Canada also played a part, they said.

The state oil and gas major hopes to sell some of these assets, which have incurred billions of dollars of losses and are in areas where the company cannot easily compete, in the next two years, the sources said.

"Australian gas assets - both Arrow Energy and Browse -- are considered among the top 'negative assets' in PetroChina's global portfolio. It's also an area where CNPC has little competitive edge," said one of the sources.

PetroChina bought Arrow Energy in 2010 for $2.5 billion via a joint-venture with Shell (SHEL.L), in its first investment in Australia's coal seam gas sector. It purchased BHP's stake in Browse, Australia's largest untapped gas resource, in 2013 for $1.63 billion.

The company is also looking to offload the wholly-owned MacKay River Oilsands and Dover Oilsands projects in Canada because of losses producing and processing the tar-like fuel into bitumen, the sources added.

PetroChina declined to comment.

China's state energy companies were among the industry's most acquisitive in the early 2010s, including CNOOC's $15 billion takeover of Canada's Nexen in 2013. But they became more subdued after the 2014/15 oil price collapse and as the government scrutinized their finances.

Economic factors have also likely caused PetroChina to question its buying spree.

Arrow is PetroChina's largest loss-making overseas investment. Browse is technologically challenging and unlikely to start producing until 2030, if it even receives final approval.

Arrow only made a final investment decision to develop the 5-trillion-cubic-feet Surat Gas Project in Queensland in 2020. It was held back by a dispute between PetroChina and Shell over the pricing of gas to a Shell-operated export facility, Reuters has reported.

Between 2018-2021, Arrow reported around A$3.3 billion ($2.29 billion) in losses, including A$2.2 billion in impairments.

"Investment decisions of our shareholders are a matter for them and Arrow will not comment or speculate,” an Arrow spokesperson said when contacted by Reuters.

BROWSE


For Browse, partners including BP (BP.L), Shell and Japan Australia LNG have spent over $100 million on development studies since PetroChina bought into the project, including a plan scrapped in 2016 to set up a $30 billion floating liquefied natural gas (LNG) project.

They are now looking at a $22 billion plan to use the field to feed the Karratha Gas Plant (KGP) in northwestern Australia as that plant's original fields dry up.

Browse operator Woodside has said the project will only go ahead if the partners can come up with an economically viable carbon capture and storage solution and reach a tolling agreement with the KGP owners.

But that lower cost plan doesn't appeal to PetroChina, said one of the sources.

"PetroChina foresees great uncertainties ahead, being the smallest stake holder and has little leverage along the value chain as it has no ownership in the downstream KGP plant," the source said.

OIL SANDS


PetroChina paid C$1.9 billion ($1.48 billion) in 2009 for a 60% stake in the Dover and MacKay River projects from Athabasca Oil Corp and then purchased the remaining stakes in the projects for a similar amount over 2012 and 2013.

The first phase of the MacKay project started up in 2017 with 35,000 barrels per day (bpd) of bitumen, climbing to a peak of 150,000 bpd, while the Dover site is expected to eventually produce 250,000 bpd of bitumen, according to the PetroChina Canada website.

One of the sources familiar with the possible divestment said that PetroChina is displeased with the relatively high production costs of $70 per barrel at the projects and both sites face discontent from local residents over their environmental impact.

($1 = 1.4440 Australian dollars)

($1 = 1.2838 Canadian dollars)

Newsletter

Related Articles

0:00
0:00
Close
ChatGPT CEO signals policy to alert authorities over suicidal youth after teen’s death
The British legal mafia hit back: Banksy mural of judge beating protester is scrubbed from London court
Surpassing Musk: Larry Ellison becomes the richest man in the world
Embarrassment for Starmer: He fired the ambassador photographed on Epstein’s 'pedophile island'
Manhunt after 'skilled sniper' shot Charlie Kirk. Footage: Suspect running on rooftop during panic
Effective Protest Results: Nepal’s Prime Minister Resigns as Youth-Led Unrest Shakes the Nation
Qatari prime minister says Netanyahu ‘killed any hope’ for Israeli hostages
King Charles and Prince Harry Share First In-Person Moment in 19 Months
Starmer Establishes Economic ‘Budget Board’ to Centralise Policy and Rebuild Business Trust
France Erupts in Mass ‘Block Everything’ Protests on New PM’s First Day
Poland Shoots Down Russian Drones in Airspace Violation During Ukraine Attack
Brazilian police say ex-President Bolsonaro had planned to flee to Argentina seeking asylum
Trinidad Leader Applauds U.S. Naval Strike and Advocates Forceful Action Against Traffickers
Kim Jong Un Oversees Final Test of New High-Thrust Solid-Fuel Rocket Engine
Apple Introduces Ultra-Thin iPhone Air, Enhanced 17 Series and New Health-Focused Wearables
Macron Appoints Sébastien Lecornu as Prime Minister Amid Budget Crisis and Political Turmoil
Supreme Court temporarily allows Trump to pause billions in foreign aid
Charlie Sheen says his father, Martin Sheen, turned him in to the police: 'The greatest betrayal possible'
Vatican hosts first Catholic LGBTQ pilgrimage
Apple Unveils iPhone 17 Series, iPhone Air, Apple Watch 11 and More at 'Awe Dropping' Event
Pig Heads Left Outside Multiple Paris Mosques in Outrage-Inducing Acts
Nvidia’s ‘Wow’ Factor Is Fading. The AI chip giant used to beat Wall Street expectations for earnings by a substantial margin. That trajectory is coming down to earth.
France joins Eurozone’s ‘periphery’ as turmoil deepens, say investors
On the Anniversary of Queen Elizabeth’s Death: Prince Harry Returns to Britain
France Faces New Political Crisis, again, as Prime Minister Bayrou Pushed Out
Murdoch Family Finalises $3.3 Billion Succession Pact, Ensuring Eldest Son’s Leadership
Big Oil Slashes Jobs and Investments Amid Prolonged Low Crude Prices
Court Staff Cover Up Banksy Image of Judge Beating a Protester
Social Media Access Curtailed in Turkey After CHP Calls for Rallies Following Police Blockade of Istanbul Headquarters
Nayib Bukele Points Out Belgian Hypocrisy as Brussels Considers Sending Army into the Streets
Elon Musk Poised to Become First Trillionaire Under Ambitious Tesla Pay Plan
France, at an Impasse, Heads Toward Another Government Collapse
Burning the Minister’s House Helped Protesters to Win Justice: Prabowo Fires Finance Minister in Wake of Indonesia Protests
Brazil Braces for Fallout from Bolsonaro Trial by corrupted judge
The Country That Got Too Rich? Public Spending Dominates Norway Election
Nearly 40 Years Later: Nike Changes the Legendary Slogan Just Do It
Generations Born After 1939 Unlikely to Reach Age One Hundred, New Study Finds
End to a four-year manhunt in New Zealand: the father who abducted his children to the forests was killed, the three siblings were found
Germany Suspends Debt Rules, Funnels €500 Billion Toward Military and Proxy War Strategy
EU Prepares for War
BMW Eyes Growth in China with New All‑Electric Neue Klasse Lineup
Trump Threatens Retaliatory Tariffs After EU Imposes €2.95 Billion Fine on Google
Tesla Board Proposes Unprecedented One-Trillion-Dollar Performance Package for Elon Musk
US Justice Department Launches Criminal Mortgage-Fraud Probe into Federal Reserve Governor Lisa Cook
Escalating Drug Trafficking and Violence in Latin America: A Growing Crisis
US and Taiwanese Defence Officials Held Secret Talks in Alaska
Report: Secret SEAL Team 6 Mission in North Korea Ordered by Trump in 2019 Ended in Failure
Gold Could Reach Nearly $5,000 if Fed Independence Is Undermined, Goldman Sachs Warns
Uruguay, Colombia and Paraguay Secure Places at 2026 World Cup
Florida Murder Case: The Adelson Family, the Killing of Dan Markel, and the Trial of Donna Adelson
×