Dear investors, shareholders, ladies and gentlemen, good afternoon. I'm Wei Fang from Board Office of PetroChina. On behalf of the company, I would like to give a warm welcome to all of you attending the Q1 results announcement of 2022. On April 29th, we held the meeting of the Board of Directors and Supervisors, and elected the candidates of Board of Directors and supervisors, and also hired the chief geologist. Issued the report of our Q1 results of 2022. Today, regarding our Q1 performance and key questions that interest the market, we are going to have an online communication with analysts and fund managers online perhaps . Today, attending the conference call are Executive Director and President Mr. Huang Yongzhang, Executive Director of the company, Senior Vice President Mr. Ren Lixin, CFO and Board Secretary Mr. Chai Shouping, Mr. Wang Hua, Director General of our Finance Department, and Mr.
Xu, Deputy Director General of our Production and Operation Management Department, and Ms. Cao Wei, the Deputy Director General of our International Department. Also, we have our relevant colleagues from the Planning Department, Finance Department, Production and Operation Management Department, International Department, as well as the board office. Now we'll have the first item on our agenda. The Executive Director and President, Mr. Huang Yongzhang, would like to give some opening remarks.
Thank you, Mr. Wei. Dear investors and shareholders, good afternoon. I am more than pleased to meet with you online. First of all, on behalf of the Board of Directors, management, and all PetroChina staff, I would like to extend my candid gratitude for your long-term attention and support.
Entering 2022, faced with resurgence of COVID-19 and geopolitical complexities and volatilities, as well as rising prices of bulk energy commodities, we maintained top priority of stability and proceed and advance steadily, achieved very good progress on all fronts. We provided very strong guarantee of natural gas supply amid the peak season, and provided a very strong support for the Green Winter Olympics. We deepened with our green and low carbon transition, continued to improve quality and efficiency, and had very good head start with very solid and sound performance. Our production and operation indicators grew steadily. Our gas production under increase outperformed most of our peers internationally. Currently, there are still much uncertainties in the global economic recovery, and global energy landscape is faced with profound adjustments. All these pose new challenges and higher requirements for us to keep up with the good work and improve corporate value.
At the same time, we can all see that the fundamentals sustaining Chinese economic growth remain unchanged. The government attach great importance to the development of energy companies and continue to pursue market-oriented reform in the energy sector, and continue to build a unified national market and provide strong support for real economy. All these provide more enabling environment and conditions for PetroChina's growth. In the past years, we have accumulated comparative advantages regarding oil and gas resources, management, technologies, and talents. Therefore, we are full of confidence about our future development. On the annual results announcement held at the end of March, our Chairman, Mr. Dai Houliang, proposed nine requirements regarding how to truly accomplish our 2022 task. It is a guidance for the whole company to build our efforts.
PetroChina will always uphold the values of green development and reliable energy delivery to fuel the growth of customers, empower people's happy lives, and maintain strategic focus. We'll pursue new development in oil and gas and E&P, and new achievement in refining and chemical transformation and upgrading, further optimization of the production, supply, and marketing system, new steps in our green and low-carbon transition, new breakthroughs in our R&D. We will actively guarantee the stable supply to meet oil and gas market demand, and fully deliver on our environmental and social responsibilities. With even better and sound performance, we will continue to reward both our shareholders and the general public. With persistence and diligence, we will definitely bring about a brighter prospect. We sincerely hope that you can, as always, follow closely and support PetroChina's development. We look forward to joining hands with you and travel long and far.
Now, our colleagues from the Board Office will give you a brief introduction of our Q1 performance. Thank you.
Thank you, President Huang. We'll move on to the second item on our agenda. We will have Mr. Liang Gang, the Securities Affairs Representative of the company, to brief you on the 2022 Q1 result. At the same time, on the English line, we'll have the Deputy Chief Representative from Hong Kong, Dr. Xing Chong, to give the same presentation. The floor is open.
Thank you, President. I would like to give a brief introduction of the PetroChina 2022 first quarter results. About oil and gas prices in the first quarter, the global economic recovery continued, but still facing uncertainty due to the impact of the COVID-19, geopolitics, and the monetary policy tightening in major countries. China's economy continued to recover steadily and is generally operating within a reasonable range. International oil prices rose sharply, influenced by supply and demand fundamentals and geopolitics. The average Brent spot price was $102 per barrel, up 67.3%, and the average WTI spot price was $95 per barrel, up 63.5%. Domestic refined oil market demand kept increasing in the first two months and declined in March due to COVID-19 impact. Natural gas market demand continued to increase. Financial highlights.
Facing the complex environment, the company made stable development as top priority and achieved a steady increase in its operating results. Through integration of production and operation, market supply, technological innovation, management enhancement, safety and environmental protection, and epidemic prevention, PetroChina accelerated the green and low-carbon transition, improved quality and efficiency, and further strengthened ESG management. We also committed to satisfying gas demand in peak season and providing clean energy to Green Winter Olympics. According to IFRS, in the first quarter, the company achieved the revenue of RMB 779 million, up 41.2%. Profit from operations of RMB 57 million, up 27.9%. Net profit attributable to owners of the company, RMB 39 million, up 14.9%. Basic EPS, RMB 0.21, up RMB 0.06 year-on-year.
For each segment, firstly, the E&P business achieved a steady growth in crude output and a rapid increase in natural gas output, with an expanded ratio of gas in total production and enhanced capacity of providing low-carbon clean energy. In the first quarter, oil and gas equivalent output was 431 MMboe, of which domestic oil and gas equivalent output was 390 MMboe, up 4.5%. The domestic crude oil output was 192.6 million barrels, up 3.7%. Domestic marketable natural gas output was 1.2 trillion cubic feet, up 5.4%.
Lifting cost was $10.8 per barrel, up 8.4% year-on-year, and if exclude impact of exchange rate changes, up 6.2%, mainly due to increase in costs such as fuel and power. E&P business realized an operating profit of RMB 38.8 million, up 201%, mainly due to the increase in production, sales, and realized prices of both oil and gas. Refining and chemicals. The company constantly promoted transformation and upgrading of refining and chemical business by optimizing product structure and increasing production of high value-added products, ensuring market supply and increasing profitability. In the first quarter, the processing volume was 302 million barrels, up 1.5%.
The production of major oil products was 26 million tons, down 2.6%, of which gasoline production down 5%, kerosene production down 22.6%, and the diesel production up 4.8%. The refining business realized an operating profit of RMB 10.7 billion, up 5.3%, mainly due to increase in prices of crude oil and refined products. In the first quarter, about the chemicals, the company produced 8.2 million tons of commodity chemical products, up 11.2%. The production of major chemical products increased significantly, of which the production of ethylene was 1.96 million tons, up 21.8%.
The chemical business recorded an operating profit of RMB 17 million, down RMB 4.5 million, mainly caused by rising prices of raw materials and a sharp decrease in gross profit. Marketing. The company closely monitored the market and coordinated production and sales to ensure smooth operation of the industrial chain. The company also carried out various marketing activities to ensure supply and marketing for spring farming. In the first quarter, total sales of refined products was 37.3 million tons, down 2.7%. Domestic sales of refined products was 24.9 million tons, up 3%, of which the sales of gasoline down 2.4%, kerosene down 21.7%, and diesel up 16.3%.
The marketing business achieved an operating profit of RMB 4.6 million, up 37.4%, mainly due to the rising prices of refined products, effective cost control, and increase in gross profit. Natural gas marketing business. The company continued optimizing gas resource structure with effort to control the procurement cost, strengthened marketing strategies, vigorously deployed retail market, and continuously improved customer service quality. In the first quarter, domestic sales of natural gas reached [60.6] billion cubic meters, up 10.9%. The natural gas marketing business realized an operating profit of RMB 8.9 million, down by 51.7%, mainly affected by combined impacts of rising costs of imported natural gas and popular restructuring of cleaner energy. The above is the company's main operating data in Q1 and the product production target in 2022 for your reference. Thank you.
请通报您，您和公司的名称。为了保证更多的有提问的机会，请每位提问者问题限不超过两个。现在我把话筒交给这个operator，谢谢。
Thank you for the presentation. Now move on to the QA session and it will come with Chinese and English consecutive interpreting. Please inform which organization you represent before asking the question. To give more people the chance to ask, please ask no more than two questions. Now, the floor is open.
大家好，何时提问，请在话机上按星一键，排队号响声号键再次按一次一。当念出你的名字后可开始发问。Ladies and gentlemen, if you would like to ask any question, please press star one on the telephone keypad, press star followed by one. Thank you。接下来有请光大证券赵乃迪。
The first question is 赵乃迪 from Everbright Securities. Please go ahead.
好的，非常感谢管理层。首先恭喜公司一季度取得了非常良好的开局，看到我们的一季报里面也看到各项业务都是经营数据非常好。那么我想再请管理层跟我们分享一下咱们公司一季度原油还有天然气产量增长的情况。好，这个第一个问题就是产量增长的问题。那么第二个问题也想公司领导跟我们分享一下，就是一季度主要的板块的业绩净利润增长的增速情况，好，谢谢领导。
The first question is from Everbright Securities. First, I would like to congratulate on the very stellar performance in the beginning of the year, and we can see from the announcement the performance is very sound. I wonder if the management can share more information regarding the increase of your crude and gas production. Second question regarding the net profit increase of your respective business segment, can you please shed more light on that?
好，谢谢赵先生，我是黄永章，这个我先回答你的第一个问题。
Thank you for the question. Now President Yongzhang Huang is taking your first question.
这个公司近年来持续加大了勘探开发的力度，2021年公司国内的SEC的油气储量当量接替率是147%，其中原油储量接替率是221%，创公司上市以来的新高，为产量提升打下了坚实的基础。
In recent years, China continued to step up our E&P efforts. In 2021, our SEC RR for crude and gas equivalent was 147%, among which are for crude 221%, which is a record high since our listing. It is a very solid foundation for further production increase.
一季度公司实现国内的油气当量产量是5,275.4万吨，同比增加了4.5%。国内的原油产量是2,606.6万吨，同比增长了3.7%。国内可销售天然气的产量是334.9亿方，同比增长了5.4%。
In Q1, our oil equivalent production 52.754 million tons, up 4.5% year-on-year. Among which crude production in China 26.466 million, up 3.7% year-on-year. Marketable natural gas 33.49 Bcm, up 5.4% year-on-year.
这公司啊，你可能比较关心原油产量，公司的原油产量增长了37%，啊主要是源于，一是强化原油开发基础管理，坚持效益开发，自然递减率、综合地质递减率均同比下降。二是精准施策，实现老区的增油提效，不断提升整体开发水平。三是长庆、塔里木、新疆等增储上产的主力油田大力实施效益先产，一季度新建产能是256万吨，同比大幅增加，投产的进度也明显加快，新井产量产油量和单井日产稳中有升。
I know that you probably give special attention to crude production. The reason behind this 3.7% increase in crude is that first we enhance the basic management of crude development and uphold the principle of profitable development. Natural decline and comprehensive decline both are in decline, a decline year-on-year. Second, we carry out targeted measures to increase production and profitability in maturing blocks to improve our overall development. In some major oil fields such as Changqing, Tarim, and Xinjiang, these are the most important areas for boosting reserve and production. We carried out possible capacity building. In Q1, we added a new capacity of 2.56 million tons, up significantly year-on-year. The oil delivery rate was also accelerated obviously, with production of new wells, as well as daily production for single wells, saw a steady increase.
好，赵先生，我想第一个关于你非常关心的国内油气产量增长的这个问题，我就回答到这。下面第二个问题，我想请我们公司的CFO蔡先生来回答这个问题。
I believe that answers your first question regarding oil and gas production. The second question will be answered by our CFO, Mr. Chai Shouping.
第一季度公司还是取得了非常好的业绩，整个公司实现净利润139亿，同比增长43.9%。
You can see that in Q1, we saw a very strong performance. Net profit attributable to parent RMB 39 billion, up by 40.9% year-on-year.
这主要是有两个原因，一个原因就是公司油气产品价格上涨、销量增加。第二个原因就是公司加大提质增效的这些力度。
That mainly comes from two factors. First, with the increase of oil and gas prices and increased sales, and second, with several more efforts in our campaign to improve quality and efficiency.
正如刚才我在互市介绍的那样，公司的油价大幅提升，国内的原油产量增长3.7%，天然气的产量增长5.4%。
Just as my colleague briefed you, the oil prices increased significantly and also oil production up 3.7% and gas 5.4%.
与此同时，公司加大企业管理的能力，提质增效创效40亿。
At the same time, we further optimize our corporate management and the campaign to improve quality and efficiency added an extra RMB 4 billion in profit.
这些的净利润主要来源于我们四个板块，四个板块全部盈利。
These net profits, you can see that are coming from our business segments. All four arms turned a profit.
上游板块，E&P板块，净利润38.7亿。炼化板块，净利润107亿。销售板块贡献了45亿，天然气板块贡献了80亿，我是指净盈利的。
In terms of operating profit, E&P segment RMB 38.7 billion, refining and chemical RMB 10.7 billion, and marketing segment RMB 4.5 billion, and natural gas RMB 8.9 billion.
上游板块还是E&P板块的贡献。
E&P segment remains to be the major profit contributor.
好，谢谢您。
Thank you.
好了，谢谢各位领导。
谢谢您的问题。下一个问题的提问的是来自瑞士信贷Horace。The next questioner is Horace from Credit Suisse. Please go ahead.
各位领导下午好。感谢提问的机会，我是瑞信的Horace谢颖坤。我这边有两个问题，第一个，就是想了解一下一季度我们的进口气亏损的情况，以及就是对于未来几个季度的展望，特别是在高油价情况下的进口气亏损的情况。那第二个的话就是，对于我们在供暖期之后的算价情况，对于这个天然气价这边，有没有什么指引？谢谢。
I have two questions. First, about the losses in imported gas in Q1. Can you share some information about that? Regarding the next few quarters, do you have any outlook, especially against backdrop of the high oil price? My second question is that after the heating season, how do you plan to pass on the cost of your imports? Regarding natural gas, how do you plan to achieve a markup?
这个问题由我来回答。我是中石油的蔡守平。
Mr. Chai Shouping is taking your question.
About our imported natural gas. In Q1, it totaled 21.2 Bcm with the tax refund of RMB 3 million and a net profit of RMB 3.47 million and profit per cubic meter RMB 0.164. You can see that we achieved a very effective loss control about our natural gas imports in Q1. Now we have entered Q2, and in Q2 and following Q3 and Q4, the natural gas marketing is entering an off-season. Under such a circumstance, we will further tighten our control regarding import gas loss and carry out various efforts and measures accordingly. Due to the COVID-19 pandemic as well as the Russia-Ukrainian issue, the international oil prices remain high, and so is natural gas. The cost of our natural gas imports is increasing with a lot of uncertainties going ahead.
PetroChina will continue to carry out various measures to cope with the situation and see market demand. We will import flexible marketing strategies. First, we'll actively explore direct sale and end user consumers. Second, we'll build the system for natural gas supply and purchase contract negotiations. Third, we will increase the online trading of uncontracted resources. With market-based measures, we will try our best to reduce import gas losses. Regarding your second question, since there is an increase of both the import gas costs and the overall prices, we expect to see higher prices domestically than that of last year. Thank you.
The next question is [Li Hang] from Morgan Stanley. Please go ahead.
I have two questions. First, a follow-up question on imported natural gas. What is your estimate about the tax refund in Q2, Q3 and Q4? What do we expect of the import LNG cost? My second question is about refined product demand. Entering April, we see that with COVID resurgence, there could be a total quarter refined product demand decline. What do we expect of the whole year level? Do you still expect a year-on-year increase with current circumstances?
李先生你好，我是中石油财务部王华。我首先回答您的这个第一个问题。
Mr. Wang Hua from the Finance Department is taking your first question.
这个进口气退税呢，是根据我们进口增值税的进项税的10%进行退税。所以说这个具体退税额会跟我们进口气的价格以及这个增值税的金额相关。
About the tax refund of imported natural gas will be 30% of the value-added tax, therefore the specific amount will be indexed to the natural gas prices as well as the VAT volume.
由于我们进口气是挂靠前九到十二个月的油价，因此我们预计二、三季度它的进口气的价格会高于一季度。
Since our import gas prices is indexed to oil prices with a nine to 12-month lag, we expect that Q2 to Q3 import gas costs will be higher than that of Q1.
所以呢，我们二、三季度包括四季度进口气到底退税会退多少，还是要可能会比要比一季度要多，绝对额会多。
Therefore, we expect that in Q2, Q3 and Q4, the tax refund in terms of absolute volume will be higher than that of the first three months.
但是具体的退税金额还是要取决于油价的这个变化。
However, the specific amount will be determined by the oil price changes.
至于全年的这个进口成本呢，我们会预计，今年的进口气成本肯定会比去年2021年会有一个全年会有一个大幅度的增长。
As for the import gas cost of 2022, we do expect a large increase compared with that of last year.
具体增长的金额还是要取决于未来几个月油价的变化。
The specific amount will be dependent on oil price changes in the coming months.
下面我回答您这个第二个问题。
Your second question.
关于成品油需求，应该说整个一季度，全国的这个成品油表观消费量实际上比去年一季度，是持平还略有增长，不同这个油的品种会有变化不同。
About the refined product demand. Actually in Q1, the total national demand in terms of apparent consumption was around flat compared to last year with slight difference between different types of refined products.
那么具体来看呢，柴油的增速是比较快的。
Diesel saw a rather large increase.
但是煤油呢，就有比较大幅度的下降。
Kerosene saw a very large decline.
这主要还是受疫情的影响。
That is mainly due to the COVID-19 impact.
全年来看呢，因为我们整个国家全年的这个经济增长还是保持在一个合理区间。
On the whole year, China's economic growth is still maintained in a very appropriate range.
因此，我们预计全年成品油还是会比去年在一个增长的态势。
Therefore, we expect that the whole year consumption as per last year will maintain an upward trend.
好，谢谢。
Thank you.
好的，谢谢领导。
谢谢您的提问。下一位有请中银国际刘志成。The next question is 刘志成 from BOCI. Please go ahead.
谢谢各位领导，
听得到吗？我是中银国际的刘志成。刚才有不少问题都询问过了，那我们问另外两个小问题吧。第一个就想请教一下，我们现在进口这个不管是俄罗斯的油跟气的时候，我们现在是怎么结算的？是用什么货币跟他们结算的？另外一个问题就是说，我们看到新闻说这个印度想让俄罗斯大幅打折把油卖给他们，那我们其实也有没有一个机会用比较便宜的价格买到俄罗斯油呢？好，谢谢。
I have two questions. First, in terms of our imports from Russia with both oil and gas, how do you carry out the settlements for now with what kind of currency? My second question is that I read from the news that India is demanding discounts of its energy imports. I wonder if we have the opportunity to demand a cheaper imports from Russia?
这个问题由我来回答吧。我是中国石油的蔡守平。
Mr. Chai Shouping is taking your question.
现在我们和俄罗斯的这些业务都是按照我们事先已经签订的合同来进行执行，整个业务运行还是正常。
Currently our operations with Russian counterparts are being executed according to the pre-signed contracts, and they are proceeding normally. Previously, our oil and gas operations with Russian companies are sometimes settled with U.S. dollars and sometimes with euros. As for now, due to sanctions and some other factors, the settlement was impacted to a certain extent. The overall proceedings and operations are still normal. As for now, PetroChina do not have any plans or arrangements to acquire discounted Russian oil or gas. Currently, we are just executing pre-signed contracts.
The next questioner is Toby from Citibank. Please go ahead.
First, I would like to confirm.
Can you hear us now?
Oh,
Okay.
I have two questions. First, to follow up on what Mr. Chai Shouping just answered about natural gas, direct sale, and end user markets. I would like to ask, what is the proportion of this part of the operation in your total natural gas sales? My second question is that you just talked about the resurgence and impact of Q2 COVID situation. I wonder if you have adjusted your utilization ratio of refining and chemical plants to cope with the current soft market.
Uh,
Mr. Lij un from the Production and Operation Management Department is taking your question regarding natural gas sales.
In Q1, natural gas sales within China, 60.6 Bcm, up 10.9%. During the same period, the apparent consumption within China, 93.2 Bcm, up 0.5%. Therefore, it is apparent that our increase far outperformed that of the total increase nationally. Also, you can see from the market structure, we are boosting our efforts in end user marketing. In Q1, the end user marketing volume accounts for about 28%.
Okay.
Thank you.
The next questioner is Hu Yifan from UBS. Please go ahead.
感谢管理层，我有两个小问题都是针对我们炼化板块的。一个问题呢，就是在一季度，受景气度和高油价影响，化工产品的毛利也是比较明显的缩窄。请问我们怎么看后面的这样的化工和成品油的毛利的情况？另一个问题呢，是关于我们目前的成品油库存的情况，还有就是说在这几个月国家也是暂停了我们成品油出口，在后面的话我们对这个成品油出口，如果成品油库存有一定亏损的话，会不会后面有这样成品油出口放开的预期？谢谢管理层。
Two questions about refining and chemical arm. First question, in Q1, due to the high oil prices, we see a narrowing gross margin of your chemical business. What is your expectation regarding the profitability of your chemical and refined products? Second, we see a decline in the inventory of refined products, and the government has halted the export of refined products. If the inventory climbs in later months, do you expect that the government will re-allow the export of refined products?
下面由我来回答这两个问题。我是中国石油任立新。
Mr. Ren Lixin is taking your question.
关于化工的业务利润问题，一季度由于油价高企，我们化工的原材料成本比较高，所以一季度整体来看，化工是处于盈亏平衡之间。
About the profitability of our chemical segment in Q1, due to the high oil price, there is a high cost of the feedstock for the chemical plant. Therefore, the chemical operations are striking a balance.
我们根据市场情况，及时调整了化工的生产组合以及产品结构。
Informed by the market realities, we adjusted the utilization ratio of our chemical plants and product mix.
还是受到了比较明显的影响。
These efforts saw very good results.
预计二季度，原油和天然气等能源还是处于较高的价。
We expect that crude and natural gas will remain high in terms of prices going into Q2.
化工原材料的成本以及加工费用可能仍然保持在较高的这个水平。
Feedstock and processing fee of our chemicals will remain high.
这将会进一步地挤压化工的获利空间。
That will press down the profitability of our chemical operations.
同时又加上这个国内的疫情反复。
Also, there is a resurgence of COVID-19 within China.
消费进一步收缩。
That hurts the consumption.
化工的市场竞争可能会进一步加剧。
Therefore, there will be even more intense competition in the chemical market.
后续我们将会根据市场变化，加强市场研判，进一步调整这个化工的产品结构，我会控制原材料采购成本和加工费，以提高化工业的创效能力。
Later, we'll carefully analyze the market changes and adjust our product mix accordingly to drive down procurement cost of the feedstock as well as the processing fee, so as to improve the profitability of our chemical operations.
目前成品油的库存跟年初相比，是处于较高的库存水平。
For now, the inventory for refined products compared with that of the beginning of the year remains rather high.
一方面我们根据市场情况，加大促销的力度。
On the one hand, based on market realities, we boosted our marketing efforts to increase sales volume.
同时根据这个市场情况，进一步优化了炼化的结构。
On the other hand, we further refined our refining and chemical product mix.
及时调整炼化使用。
Made timely adjustments to our refining capacity and utilization ratio.
另外就是根据国家相关部门的要求，严格出口相关规定，继续推进部分产品出口。
We also arranged appropriate exports of certain products with strict abidance to relevant authorities and export protocols.
目前呢，这个原油产业链运行平稳，产销平衡。
For now, the crude industry chain is operating smoothly with a good balance between production and marketing.
随着近期疫情的好转，成品油库存已经呈下降趋势。
With the improvement in the COVID situation lately, we see that the inventory is going down.
未来随着疫情形势进一步好转，国内宏观经济持续复苏，我想整个的加油产业链会进一步更加平衡一些。
In the future, as COVID-19 dies down and macro economy picks up, we believe that the crude value chain will operate even more smoothly.
谢谢。
Thank you.
因为时间关系，我们现在接受最后一个提问，谢谢。
In the interest of time, now we'll have the last question, please.
最后一个提问者是来自DBS的苏婷婷。 The last questioner is [Su Tingting] from [DBS] please go ahead.
好，各位领导好，我想接下来问两个关于上游的问题。首先第一个问题想问一下，我们一季度的话，原油的完成成本是多少，预计今年剩余时间的话，我们这个原油成本会维持在一个什么样的水平？然后第二个问题呢，想问一下，就是随着我们今年这个原油价格比去年还有一个大幅提升，我们今年会不会也取得一个比较好的RR，大于100%或者是200%的一个水平？谢谢。
My two questions are about the upstream. First in Q1, I wonder what is your all in cost for crude and for the remainder of the year, what do you expect of your crude production cost? Second, since the oil prices will be higher than that of last year, do you expect to see a very high RR this year over 100% or even 200% likely?
好，这个苏女士你好，我是财务部王华，由我来回答您这两个问题。
Mr. Wang Hua from the Finance Department is taking your question.
公司一季度的油气单位操作成本是10.82元，同比增长了8.4%。
In Q1, the crude operating cost $10.82, up by 8.4%.
其中，国内油气单位操作成本是11.24元，同比增长了7.5%。
That within China was 11.24 at 7.5% year-on-year.
这主要呢就是两个原因，一个就是汇率变化影响操作成本增加了两毛二。
That mainly comes from two reasons. First, the changes in exchange rates up RMB 0.20.
第二个就是这个材料动力这些成本上涨影响，操作成本呢增加了大约五毛多钱。
Second, the price hike of materials and power added to more than RMB 0.50.
因为大家知道整个一季度呢，全球大宗商品的这个价格都在上涨，燃料动力价格也在上涨。
We all see that in Q1, the prices of stock commodities increased significantly and so is that of fuel and power.
根据我们国家统计局发布的数据，一季度PPI的价格指数上涨了8.5%左右。
According to the National Bureau of Statistics of China, the PPI in Q1 increased by about 8.5%.
对于我们油气田企业，它购进的成本，材料和动力成本上涨的幅度会更大一点。
The price hike of oil and gas field companies, their procurement of materials and power will see a higher increase.
这是我们这个成本上涨的最主要的两个因素。
That is the two most vital issues behind the cost increase.
我们公司一直坚持低成本战略，扣除这些客观因素之后，可控的成本实际上还是在下降的。
PetroChina always adhere to the principle of low cost development strategies. Besides these rigid factors, in terms of controllable costs, you can see that there is still a decline.
应对这个第二个问题，关于这个勘探业务的收益率的问题。
Second, about the gains of the E&P sector.
我们一季度呢，勘探与生产业务的经营利润同比增长了200%。
In Q1, the operating profit of our E&P segment up 200%.
这里面有这个原油实现价格同比增长了55%的这个原因。
That comes partly from the 55% increase of the realized crude price.
因为我们黄总和林总刚才提到的我们上游原油和天然气的产量、销量都在增长的影响。
There is that as Mr. Huang, Mr. Ren briefed you, there is an increase of our production and sales upstream.
同时也是公司上下努力控制成本、提质增效的一个结果。
Meanwhile, that also mirrored our efforts to drive down costs, improve quality and efficiency of the entire staff. Throughout the year, we expect the oil price to be higher than that of last year and remain at a high range. We do foresee a better performance of the upstream segment compared with that of 2021. Thank you.
Mr. Wei Fang would like to add a few words.
Also this year with the higher oil prices, we are going to boost our NPT efforts just as our executive briefed in this conference. Against the high oil price environment and the new supply and demand realities, we strive to make more E&P deliveries to better suffice the market. Now I would like to thank Mr. Huang, Mr. Ren, and Mr. Chai, as well as other colleagues from different departments for attending this conference call, and it has come to a close. If you have further inquiries, you are more than welcome to contact our investor relations team in both Hong Kong and Beijing. Thank you all for your time.