Asia's largest oil refiner, Sinopec yesterday said its total oil output rose 0.62 percent to 136.7 million barrels for the first half of this year.

The State-owned oil giant also witnessed its gas turnover increase by 4.74 percent to 104.80 billion cubic feet during the first six months, as new sources were found and enhanced technology and management enhanced the output of existing fields, Sinopec said.

Production data for the first half were not audited and the company will release its audited production data in its interim report in late August, Sinopec said yesterday in a statement on its website.

"The result is an overall reflection of the market, and our upstream oil and gas businesses have been mainly encouraged by soaring crude prices, which, however, also squeezed the refining and petrochemical sectors," one official from Beijing-based Sinopec's general office yesterday told China Daily, declining to be named.

The oil refiner processed 68.08 million tons of crude in the first half, up 4.77 percent year-on-year.

Sinopec yielded 11.32 million tons of gasoline during the period, a drop of 0.88 percent from a year earlier.

Its diesel output in the six-month period increased by 6.43 percent to as much as 26.31 million tons.

Kerosene output, including jet fuel, rose 11.88 percent to 3.39 million tons, while production of light chemical feedstock increased 13.90 percent to 10.16 million tons, the company statement said.

Industry analysts said it is difficult to further decipher Sinopec's production data since the company does not provide oil prices.

Gong Jingshuang, a senior analyst with China National Petroleum Corp, Sinopec Corp's major rival in the domestic market, said the refining margins of China's oil majors are affected by a slew of factors, which not only includes market elements, but also government regulations to ensure domestic supply.

"As the imported crude prices soar ahead, oil companies' refining business margins have been eroded by the government's price caps on refined oil," said Gong.

Besides, Sinopec's petrochemical production also increased as new facilities were put into operation.

The operation of two large-sized plants in Nanjing and Shanghai, with a combined capacity to produce 1.5 million tons of ethylene annually in the first half, has boosted Sinopec's ethylene output by some 11 percent to reach 2.3 million tons from January to June.

Sinopec earlier said it aimed to produce 39 million tons of crude in 2005 and 6.07 billion cubic meters of natural gas.

The company is expected to produce approximately 5.4 million tons of ethylene for the entire 2005, Wang Jiming, vice-board-chairman of Sinopec, earlier told reporters in Shanghai at a new briefing.

Sinopec shares remained unchanged at HK$3.025 (38 US cents) yesterday after rising 5 percent over the past one year.

Rival PetroChina last Friday said its oil output increased by 2.1 percent to 396.6 million barrels in the first half of the year, and the gas turnover surged 23.4 percent to 506.3 billion cubic feet.

(China Daily July 19, 2005)