Chinese refiner Sinopec 1H profit up 12 pct

By the Associated Press | August 28, 2011 | 9:40 PM EDT

SHANGHAI (AP) — Sinopec, Asia's largest refiner by capacity, said its profit rose 12 percent in the first half of the year as higher oil and gas revenues helped offset a loss in its refining sector.

The company, also known as China Petroleum & Chemical Corp., said Sunday that its net profit in January-June was 41.2 billion yuan ($6.4 billion), or 0.475 yuan (7 U.S. cents) per share, based on international financial reporting standards.

The results were better than analysts had forecast. Profit a year earlier was 36.8 billion yuan.

The company attributed the improvement to higher oil and chemicals prices and better integration of its upstream and downstream businesses. But it said the outlook for coming months was uncertain.

"We are and we will be facing a complicated macro-environment," said Sinopec's chairman, Fu Chengyu, noting the impact of the crises in the United States and Europe on the global economic recovery.

The 44 percent increase in global crude oil prices in the first half of the year was both a help and a hindrance. While its revenue surged 31.7 percent in January-June to 1.2 trillion yuan ($187.5 billion), buoyed by strong sales of oil, gas and chemicals, higher costs for imported crude oil pulled Sinopec's refining sector into loss.

The company's refining sector posted a 12.2 billion yuan ($1.9 billion) loss in the first half, compared with profit of 5.7 billion yuan in the same period a year earlier.

Sinopec said its crude oil output fell 5.4 percent to 156.3 million barrels, as maintenance of machinery in its oil fields in Angola forced a sharp cutback in production. Its natural gas output rose 27 percent to 253.88 billion cubic feet (7.19 billion cubic meters).