Breaking Down Kunlun Energy Company Limited Financial Health: Key Insights for Investors

Born in 1993 as a Hong Kong-listed subsidiary of CNPC, Kunlun Energy Company Limited (0135.HK) has grown into an international oil and gas player operating across China, Kazakhstan, Oman, Peru, Thailand, Azerbaijan and Indonesia, and after the 2017 integration became CNPC's exclusive platform for natural gas terminal sales and integrated utilization - a transformation reflected in its 2023 annual sales of 49.28 billion cubic meters (a 9.6% year-on-year increase) and inclusion in 12 indexes such as the Hang Seng SCHK China Central SOEs and ESG Leaders Index; driven by a mission to provide clean energy and "Gas in Substitution of Oil," the company invested approximately HKD 10 billion in renewable projects in 2022, launched a Gas Power and New Energy Division in 2023, and has seen governance and sustainability credentials rise with recognitions like an A-level in the State-owned Enterprise Reform "Double-hundred" and an MSCI ESG upgrade to BBB alongside a CDP climate rating of B-, underscoring its vision to be China's first-class integrated green energy provider rooted in innovation, low-carbon development, people-centered values and strong talent cultivation

Kunlun Energy Company Limited (0135.HK) - Intro

• Core upstream and midstream presence in China, Kazakhstan, Oman, Peru, Thailand, Azerbaijan and Indonesia.
• Annual sales volume: 49.28 billion cubic meters in 2023 (up 9.6% YoY).
• Included in 12 indexes, including the Hang Seng SCHK China Central SOEs Index and Hang Seng SCHK China Central SOEs ESG Leaders Index.

• Deliver reliable, affordable energy through safe and efficient upstream and downstream operations.
• Support national energy security and CNPC group strategy by optimizing natural gas commercialization and terminal sales.
• Advance low-carbon transition by integrating gas power and new energy solutions into core business lines.

• Become a leading integrated natural gas and new energy platform in Asia-Pacific and key global basins.
• Achieve sustainable growth that balances production, environmental stewardship and shareholder returns.
• Leverage technological and operational excellence to scale gas power and new energy deployments across existing markets.

• Safety and Compliance - prioritize HSE standards in exploration, production and terminal operations.
• Operational Excellence - drive efficiency across the value chain from reservoir development to gas sales.
• Customer Focus - ensure stable supply and integrated services to industrial and residential customers.
• Innovation and Transition - invest in gas power, new energy and decarbonization pathways.
• Stewardship and Responsibility - adhere to CNPC governance while participating in ESG-focused indices.

Kunlun Energy Company Limited (0135.HK) - Overview

• "Gas in Substitution of Oil" is a core operational principle to maximise the environmental and economic benefits of natural gas and LPG.
• Committed to promoting low‑carbon economic and social development by leveraging its integrated industrial structure (exploration, LNG, pipeline transmission, distribution and new energy).
• People‑oriented approach: secure and stable natural gas supply to support regional development and social harmony.
• Compliance and social responsibility: abide by laws and regulations, give back to society, and provide an employee growth platform while collaborating with stakeholders to build a harmonious society.
• Renewable energy commitment: in 2022 the company invested approximately HKD 10,000,000,000 in developing renewable energy projects, signifying a strategic pivot toward sustainable growth.

• Scale low‑carbon fuels by accelerating pipeline and LNG infrastructure and promoting substitution of oil in transport and industry.
• Deploy capital into renewable power, storage and integrated gas‑to‑power solutions-evidenced by the 2022 renewable investment program.
• Strengthen social license through reliable supply, safety and community engagement programs that reinforce regional stability.
• Maintain strict regulatory compliance and corporate governance while developing talent and stakeholder partnerships.

Kunlun Energy Company Limited (0135.HK) - Mission Statement

• Advance national strategies by aligning business growth with energy security, carbon peak/carbon neutrality goals and regional development priorities.
• Promote market-oriented, technology-driven transitions to accelerate decarbonization across operations and supply chains.
• Enhance stakeholder harmony through transparent governance, shared-value initiatives and broad-based social contributions.

• Scale integrated gas distribution and midstream infrastructure to guarantee supply resilience and market coverage.
• Accelerate adoption of low-carbon fuels (hydrogen, biomethane) and electrification where strategically viable.
• Strengthen ESG management systems and reporting to meet international investor expectations and regulatory requirements.

• A-level rating in the State-owned Enterprise Reform 'Double Hundred Action' - recognized for sustainable development and reform performance.
• MSCI ESG rating upgraded to BBB in 2024, reflecting strengthened governance and environmental management.
• CDP Climate Change rating elevated to B- in 2024, marking achievement of climate management level for the first time.

• Embed ESG criteria in executive performance incentives and capital allocation decisions.
• Maintain transparent disclosures aligned with international frameworks and deepen investor engagement.
• Work collaboratively with regulators, industry peers and local communities to scale green energy infrastructure.

Kunlun Energy Company Limited (0135.HK) - Vision Statement

• Innovation-driven, green development: prioritize clean-energy solutions, efficiency improvements, and investment in low-carbon technologies.
• Progress with stability: balance growth ambition with rigorous compliance, risk control, and state-owned enterprise reform best practices.
• Human capital as strategic asset: build and retain a high-quality talent pool aligned to industry evolution.
• Employee-centric culture: protect rights, promote wellbeing, and enhance a sense of belonging and achievement.
• Social responsibility and low-carbon advocacy: leverage industrial strengths to promote broader low-carbon economic and social development.

• Expand gas sales and infrastructure to capture demand growth from urbanization and industrial decarbonization.
• Invest in distributed energy, CNG/LNG supply chains, and digitalization for operational efficiency.
• Deepen compliance and governance reforms while maintaining long-term fiscal discipline.

• Structured training and leadership pipelines to align capability development with technical and commercial roles in gas, LNG, and new-energy projects.
• Performance and welfare frameworks designed to safeguard rights and increase employee engagement and retention.
• Targeted recruitment for digital, environmental, and project-management competencies to support low-carbon transition.

• Reduce operational emissions through pipeline efficiency, methane leak detection, and electrification of key processes.
• Scale LNG/CNG infrastructure to lower carbon intensity for industrial and transport end users.
• Engage in corporate social responsibility programs that support community resilience and energy access.