China makes leaderboards of 2015 Platts Top 250 Global Energy Company Rankings

Source: Platts

China showed its increasing strength, not only as an energy production and demand center, but also as a leader in the world energy arena, according to the Platts Top 250 Global Energy Company Rankings® , which were announced Tuesday night.

China showed its increasing strength, not only as an energy production and demand center, but also as a leader in the world energy arena, according to the Platts Top 250 Global Energy Company Rankings®, which were announced Tuesday night. The Rankings, now in their 14th year, were unveiled to more than 300 energy executives at an annual dinner in Singapore, hosted by Platts, a leading global energy and commodities information provider.

The Platts Top 250 rankings reflect the financial performance of publicly traded energy companies with assets greater than U.S. $5 billion, and are based on a combination of asset value, revenue, profit and return on invested capital (ROIC) for the latest fiscal year (2014).

China Sets Record with 3 Companies in Top 10

Not one, but two Chinese energy giants, CNOOC Limited (Ltd) and PetroChina Company Ltd., moved into the Top 5 for the first time since the rankings began in 2002. The state-backed companies have rivaled Big Oil of the West for years, with PetroChina having appeared in the Top 10 for 11 years, and CNOOC Ltd. hovering in the 13th and 12th spots for the last several years.  Despite weaker coal markets, China Shenhua Energy jumped into the Top 10 for the first time at #9, up from #15 place last year, as shrinking earnings from leading oil producers gave it a relative boost. It was the only coal and consumable fuel company in the leaderboard and marked the first time that China has had three companies in the top ranks, traditionally dominated by European and Americas counterparts.

China was among the Asia Pacific (APAC) countries highlighted in the evening’s keynote address, “Diversification and Unification of Capital for Energy Investment ,” given by Dr. Bo Bai, managing director of Warburg Pincus, who said he remains “cautiously optimistic” on the future of energy investing in China, India and Southeast Asia. “As the region opens up its blocks, and reforms its fiscal regimes to enhance risk-adjusted returns, investment dollars will pour in, allowing countries in the region to benefit from more exploration, reserves, and production,” explained Bai.   

Exxon Mobil Corporation Surpasses Decade at Top Spot

Exxon Mobil Corporation retained its stronghold on the #1 spot for the 11th consecutive year, though integrated oil majors made up only half of this year’s Top 10, with the sector’s slightly weaker standing paving the way for two refining and marketing companies – Phillips 66 and Valero Energy Corporation – to join the Top 10 in 6th place and 8th place, respectively.  Besides climbing from its 2014 rank of 13th place, Phillips 66 retained its positon as the world's biggest refiner. Valero, the world’s biggest independent refiner, continued to benefit from the glut of U.S. crude oils in the U.S. Gulf Coast region.

The Americas moved up the regional rankings, with its Top 10 energy companies placing 12th overall, up from the average rank of 15.5 the year before. Taken together, Americas energy firms now comprise 45% of the Top 250, crowding out a number of rivals from Asia and Europe. The changes also mark an inflection point for Asia’s energy sector, which for years has seen its overall standing in the Platts Rankings edge higher and higher. While Asia’s emerging economies, led by China, continue to pull in the biggest share of incremental global commodity demand growth, the pace of growth is now clearly slowing. 

APAC Softens, Europe, Middle East and Africa (EMEA) Falters

Noticeably missing from the leaderboards’ 5 and 10, were Britain’s BP p.l.c., France’s TOTAL SA, and Russia’s OJSC Gazprom. The latter state gas supplier, which placed 4th overall last year, dived 39 places to 43rd, buffeted by the ruble’s collapse, its impact on long-term credit, and other factors. TOTAL, once a Top 10 fixture, tumbled to 26th place this year as its earnings and returns faltered. Last year’s 2nd-ranked BP fell to 29th this year, due in large part to its weaker profits and poor 2% ROIC.

China showed its increasing strength, not only as an energy production and demand center, but also as a leader in the world energy arena, according to the Platts Top 250 Global Energy Company Rankings® , which were announced Tuesday night.

Despite a host of individual corporate achievements, Asia Pacific as a whole felt its economic muster begin to wane. The region, which had shown a “personal best” in last year’s 2014 roster with 82 energy companies in the ranks -- surpassing the “personal best” of Europe, Middle East and Africa (EMEA) in 2008 with 80 spots -- slipped to 78 in the latest Rankings. A drop was also seen in APAC’s average ranking of 137, as compared with 134 last year. Still, APAC’s fastest growing ten companies had an average 3-year compound growth rate (CGR) of 21%, bettering the 14.8% CGR of its European counterparts. 

The number of EMEA entries on the list continued to slide this year, with 59 companies holding an average ranking placement of 123, down from last year when the region fielded 65 energy firms averaging a position of 113. Growth rates, based on average 3-year CGR, were just 2.8% -- less than half that of APAC (6%) and less than a third of that of the Americas (10.4%).  Of the Top 50 Fastest Growing energy firms, only four were based in EMEA.

Shale Play Advances Americas

Shale oil retained center stage, helping to usher 113 Americas companies (89 U.S. and 14 Canada) into this year’s Top 250 with an average ranking of 119.  This is up from 103 companies with an average rank of 126 in 2014 but still below the 2003 peak of 149 companies. 

Despite being in its fifth year and in a much lower price environment, the shale oil revolution in some places of the U.S. has barely begun. Basins such as the Permian in West Texas and Mexico are reportedly becoming more productive, and producers continue to knock down the cost of production, requiring fewer rigs to continue high oil output.  

Dominating the worlds’ Top 10 and Top 50 Fastest Growing energy company rosters are the Americas’ tight and shale oil producers, as well as mid-stream and refining companies that are carrying and processing their increasing production volumes. Even gas utilities like AGL Resources Inc. have ridden the wave of booming shale gas volumes moving to end customers through its increased transport/pipeline assets.  While overall corporate growth rates for energy companies slowed from 10.0% to 7.3% on a 3-year CGR basis, the Americas energy companies (many of which are companies directly or indirectly benefiting from shale) shown in the Fastest Growing list, collectively enjoyed a combined 56% CGR, up from 46.8% the prior year.

Mixed Bag for Utilities; Highest-Ranked Utilities Move Higher

Some 128 of the world's Top 250 Global Energy Companies are electric utilities, gas utilities, independent power producers, multiple utilities, and renewable electricity producers. Utilities were among the sectors advancing in the 50 Fastest Growers list. All 10 of the highest-placed utilities have moved higher in the 2015 Top 250, indicating the reduced exposure to pure commodity price risk that these diversified and often partly regulated companies face, as compared to mid-cap oil and gas concerns.

Separately, the largest pure coal mining company in the world, Coal India, climbed to 38th place this year from 47th place a year ago, due in large part to its impressive growth year-over-year, including a 14% jump in drilling over the past year.

“Asia CEO of the Year” Awarded

Taking “Asia CEO of the Year” honors this year was Ms. Nishi Vasudeva, chairman and managing director of Hindustan Petroleum Corporation Ltd.  With this win, Vasudeva is automatically in the running with other finalists for the global “CEO of the Year” award, which will be announced December 9 at the Platts Global Energy Awards in New York.

The Platts Top 250’s independent judges panel, already impressed with Hindustan Petroleum’s history of peer-beating marketing margins, credited Vasudeva’s exemplary leadership with steering the company to its stated best financial performance since its 1974 formation.  In the past year, the refining and marketing company showed a personal best in profits, well beyond its decades’ highest profit from the prior year. According to the judges, these accomplishments were even more significant when juxtaposed with the volatile global economy, as well as India’s high rates of inflation, weak currency, and the cyclone damage to the company’s 8.3-million-tons-per year, 166,000 barrels-per day refinery at Vishakhapatnam.

Hindustan Petroleum ranked 12th among the Top 250’s refining and marketing companies, 43rd in terms of Top 250 by revenues, and 133rd overall.  Like Hindustan Petroleum, India also scored a personal best this year with 14 energy companies on 2015 list, as compared with 13 in 2014.  India’s lead three energy companies included Reliance Industries (14th), ONGC (17th) and Coal India (38th).

Access an in-depth analysis of this year’s Rankings by Robert Perkins, Platts EMEA oil news senior writer, and Henry Edwardes-Evans, Platts Power in Europe associate editorial director, at this link: “A Game-Changer Year.”


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