2022 Oil Industry Research Report

Source: Asset Information Network, Qianji Investment Bank, iFinD (1) PetroChina [601857.SH]: China National Petroleum Corporation (CNPC) was established on November 5, 1999. It is China’s dominant and largest integrated oil and gas producer and marketer, one of China’s largest revenue-generating enterprises, and among the world’s largest oil companies. The company aims to become a globally competitive international energy enterprise and a leading global producer and marketer of petroleum and petrochemical products. PetroChina engages broadly in oil- and gas-related businesses, including: exploration, development, production, and sales of crude oil and natural gas; refining, transportation, storage, and sales of crude oil and petroleum products; production and sales of basic petrochemicals, derivative chemical products, and other chemical products; and transportation and sales of natural gas, crude oil, and refined petroleum products. (2) Sinopec [600028.SH]: China Petroleum & Chemical Corporation (Sinopec Corp.) primarily engages in oil & gas operations and chemical operations. Its oil & gas operations include exploration, development, and production of crude oil and natural gas; pipeline transportation of crude oil and natural gas; refining of crude oil into petroleum products; and marketing of crude oil, natural gas, and refined petroleum products. Its chemical operations encompass manufacturing and marketing of a broad range of industrial chemical products. Sinopec is one of China’s largest oil & gas producers; ranks first in refining capacity nationwide; maintains a comprehensive finished-oil sales network across China and is China’s largest supplier of finished oil products; and ranks first in ethylene production capacity in China, having built a relatively complete chemical product marketing network. (3) Rongsheng Petrochemical [002493.SZ]: Rongsheng Petrochemical Co., Ltd. mainly engages in research & development, production, and sales of various petrochemical and chemical fiber products. Its product portfolio includes olefins and downstream derivatives, aromatics and downstream derivatives, gasoline, diesel, jet fuel, purified terephthalic acid (PTA), polyethylene terephthalate (PET) chips, PET bottle-grade resin, polyester pre-oriented yarn (POY), polyester fully drawn yarn (FDY), and polyester textured yarn (DTY)—over thirty product categories in total. The company ranks among China’s leading integrated petrochemical and chemical fiber enterprises in terms of comprehensive strength. 3.6 Key Global Competitors Major non-Chinese global enterprises include EOG Energy [EOG.N], Hess Corporation [HES.N], ConocoPhillips [COP.N], Phillips 66 [PSX.N], Gulfport Energy [GPOR.N], Marathon Petroleum [MPC.N], ExxonMobil [XOM.N], Rex American Resources [REX.N], Southwest Gas Holdings [SWX.N], and Laredo Petroleum [LPI.N]. Figure: Major U.S.-Listed Enterprises Source: Asset Information Network, Qianji Investment Bank, iFinD (1) ExxonMobil [XOM.N]: ExxonMobil Corporation was founded in 1882 in New Jersey. Its divisions and affiliates operate or sell products in the United States and most other countries worldwide. Its core businesses involve exploration and production of crude oil and natural gas, as well as manufacturing, trading, transportation, and sale of crude oil, natural gas, petroleum products, petrochemicals, and various specialty products.

From the Earnings Call of America’s Second-Largest Energy Storage Giant, We Identified Three Key Emerging Trends in Overseas Energy Storage | In-depth Industry Analysis

In July this year, Tesla signed a $4.3 billion energy storage battery supply contract with LG Energy Solution. Tesla’s Chief Financial Officer previously stated publicly that, due to factors such as tariffs, the company is actively seeking battery suppliers outside China to meet the demand of its energy storage business (e.g., Megapack). As the sole North American player, Fluence must treat compliance as its top strategic priority. It has adopted two major strategies—spending lavishly without hesitation: 1. Resolving Core Supplier Compliance Issues: Fluence is actively engaging with AESC (a battery manufacturer under Envision Group) to resolve PFE (Prohibited Foreign Entity) compliance issues at AESC’s U.S. factory. Fluence has even indicated it may acquire the factory outright to ensure the ‘American origin’ of its battery supply chain—demonstrating its willingness to deploy capital to transform its supply chain into a proprietary competitive moat. 2. Supply Chain Diversification and Localization: To mitigate risk and meet increasingly stringent domestic content requirements, Fluence has already signed an agreement with a second U.S.-based battery supplier. This means Fluence can now offer energy storage systems in the U.S. that are 100% free of Chinese-made components. Fluence’s U.S. Domestic Supply Chain Deployment In short, Fluence is proactively reshaping itself—through capital deployment and supply chain restructuring—into the ‘top-performing student’ compliant with U.S. policy requirements. This also signals one key point: At least in the near term, do not hold overly optimistic expectations for the U.S. market reopening access to non-U.S. supply chains. Tesla, Canadian Solar (CSI), and Fluence—the players with the deepest understanding of this market—have all invested substantial capital and effort to rebuild localized, diversified, non-Chinese supply chains. 03 Unexpected Growth: Scale Breakthrough in Non-U.S. Markets Fluence’s global expansion also reveals a critical insight: high-value large-scale energy storage markets overseas are no longer limited to the United States. Historically, non-U.S. large-scale overseas energy storage markets were concentrated in the Middle East and South America. Objectively speaking, however, both regions consist largely of developing economies where the price per watt remains relatively low. Yet Fluence highlighted two notably prominent markets this time: First, the Australian market: The Asia-Pacific region delivered exceptionally strong performance in Q4, contributing nearly half of Fluence’s record-breaking order intake. This indicates robust and sustained demand for energy storage across the Asia-Pacific region—particularly in Australia and select emerging markets. Specifically, the Asia-Pacific region (primarily Australia) accounts for one-quarter of Fluence’s current order backlog and half of its newly added orders this quarter. APAC refers to the Asia-Pacific region (mainly Australia) EMEA refers to Europe, the Middle East, and Africa (primarily Europe) The milestone for the European market lies in project scale breakthrough. Fluence announced a large-scale energy storage project in partnership with German utility LEAG, with a capacity of up to 4 gigawatt-hours (GWh). This is the largest battery energy storage project in European history. This 4-GWh project not only shatters the prior perception of Europe as a ‘slow-starting’ and ‘small-project’ market but also marks an acceleration in Europe’s energy transition—signaling growing acceptance and deployment of ultra-large-scale energy storage solutions.