China Oil and Gas Group this week was forced to deny media reports that one of its former executives was the subject of an investigation as part of a corruption probe. China Oil and Gas is partner of state-owned oil titan PetroChina. Shares in the company, which distributes piped gas in Chinese cities, were suspended.
The article, which appeared in the 21st Century Business Herald, cites sources that claim Su Shi Feng, the former president of China Oil and Gas’ joint venture Kunlun energy (which is PetroChina’s liquefied natural gas distribution arm) had been placed under investigation in connection with a widening prove into the national oil giant.
China Oil and Gas were quick to pour cold water on the report, stating that “such a report is inconsistent with facts”, and also reminded the press that Su had retired. Trading in the company’s shares resumed in the afternoon, with the stock down 1.87 percent.
The Chinese government said earlier in September that it was investigating Jiang Jiemin, a former chairman of PetroChina and parent company China National Petroleum Corp (CNPC), for “serious discipline violations”. Reuters reported that this is normally shorthand used to describe graft, or abuse of position for financial gain.
Similar investigations have been announced into a former CNPC vice president and three former executives at PetroChina. One of those men, Li Hualin, was also a former chairman of Kunlun Energy. The investigation has sparked a sell-off in shares of mainland and Hong Kong-listed firms with close ties to PetroChina. China Oil and Gas, which has a market value of $687 million, has lost around 25 percent in the past month.
- UPDATE 1-PetroChina partner China Oil & Gas denies former executive under investigation (uk.reuters.com)
- China oil and gas tycoons run for cover (fcpablog.com)
- Graft Probe Threatens PetroChina as Executives Targeted: Energy (bloomberg.com)
- China widens anti-graft drive as 3 PetroChina managers quit, are under investigation – @BloombergNews (bloomberg.com)
- PetroChina deepening corruption scandal (ecombiz.biz)