Petrochina Organizationalanalysis

Topics: Petroleum, Athabasca Oil Sands, Corporation Pages: 27 (11232 words) Published: February 17, 2013
Executive Summary

    PetroChina is one of the largest oil and gas suppliers in the world, and is engaged in activities related to petroleum and natural gas. The China National Petroleum Corporation (CNPC) controls PetroChina[I assume you will talking about who controls CNPC in the body of this report] as they currently have an 86% ownership of the equity interest. Though the company primarily operates in the northern and southern provinces of China, PetroChina had established a wholly owned subsidiary called PetroChina International. This subsidiary focuses on international oil and gas exploration in order to further their long-term objective in creating sustainable growth.

    The company operates in five business avenues, which include exploration and production, refining and chemicals and marketing. As the company is still faced with threats of competition from both the domestic and international regions, PetroChina has begun to re-evaluate their internal processes with regards to improving efficiency with fuel output. However, due to the price constraints enforced by Chinese government, the company hopes to expand its presence in overseas operations such as Central Asia, East Africa, Australia and Canada.

As the company moves forward into acquiring foreign assets, they have observed its own [This doesn’t sound quite right]external threats with regards to heightened competition, concentrated share ownership, government regulation, and overexpansion. Main competitors in their domestic environment include Sinopec and China National Offshore Oil Corporation, which have also adopted an aggressive strategy in acquiring overseas operations[Including bullying everyone is Southeast Asia]. PetroChina is also faced with government regulation having a direct effect on their operating profits due to major operations being in their domestic region. Over expansion has been another consideration, given the expected growth rate from these investments not being realized until a later period, which would expose them to a higher level of risk.

PetroChina has strong core competency in their operational performance in adapting to the changing industry and ensuring a steady level of production in their operations. The company has been able to take on a dominant market position due to their sustained leadership, management practices, and integrated systems.

The organizational culture has also been a key aspect in PetroChina's development, as corporate leadership and objectives needs to be reflected upon their own internal operations. The work philosophy of the company observes that employees are the key drivers in the company’s operations and work environments have a direct impact on PetroChina's level of output. This includes providing stringent regulations to hold the management to a higher level of accountability with respects to ensuring work safety and career opportunities.

Furthermore, PetroChina has begun to adopt new technologies in response to the changing attitudes of society. This includes their research into biofuel technology as an alternative fuel source and even developing new pipelines in order to improve transportation and reduce costs in their value chain. New forms of innovation in the oil and gas industry have become a new trend in these old markets in hopes to creating a sustainable fuel source while being able to be a positive impact on the world environment.

Company Overview

PetroChina is regarded as one of the largest oil and gas producers and sellers in the People's Republic of China[ PetroChina. 2012 Interim Report. PetroChina Official Website. Retrieved from]. The company itself "was established in 1999 as a joint stock company with limited liability as part of the restructuring of China National Petroleum Corporation (CNPC)"[ PetroChina Company Limited. Company Profiles. Retrieved from EBSCOHost on...
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