Sinopec to raise $7.8b after 12% profit rise

Sinopec (SNP.NYSE, 600028.SH, 0386.HK) announced Sunday it intends to raise US$7.8 billion through bond sales after enjoying an unexpected 12% rise in first-half profits, the Financial Times reported. The world’s second-largest oil refiner said it will sell a mixture of regular and convertible bonds to existing shareholders to fund projects, increase working capital and pay off debts. Sinopec’s increase in profitability to US$6.4 billion, which beat analysts’ expectations, came in the context of profit increases posted by China’s other state-controlled energy giants. China National Offshore Oil Company (CNOOC; CEO.NYSE, 0883.HK) reported a 51.4% increase in first-half profit despite production disruptions caused by a recent oil spill, and PetroChina (PTR.NYSE, 601857.SH, 0857.HK), the listed subsidiary of China’s largest energy producer China National Petroleum Company, saw profits increase 1%. PetroChina’s profits in particular were restrained by Beijing’s price controls on retail fuel; both PetroChina and Sinopec operate large gas station chains across China, whereas CNOOC does not. Regardless, analysts believe Chinese oil companies are poised for another wave of overseas acquisitions.