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Brightoil Petroleum (Holdings) Ltd. has announced its annual results for the year ended 30th June 2011.

Gross profit and profit attributable to the shareholders increased by 63.4% and 14.6% to HK$2.45 billion and HK$1.27 billion respectively. Total revenue surged 190% to HK$39.55 billion as compared with the corresponding period in 2010.

Basic earnings per share were HK18.8 cents, up 2.2% in a comparison with the corresponding period last year. The board recommended the payment of a final dividend of HK$3.5 cents per share (2010: HK3.0 cents).

Commenting on the results, Dr. Sit Kwong Lam, Chairman & President of the Group, said, “We are pleased to achieve remarkable growth in revenue and the scale of business for the fiscal year of 2011. Early this year, the Group entered into a US$4 billion Strategic Co-operation Agreement with the China Development Bank Corporation Hong Kong Branch, demonstrating the strong support of the government. To sustain our growth momentum, we will not only continue to expand our global network and the scale of our International Supply and Bunkering (ISB) business, but will also push ahead the development of our upstream business in order to excel as a global energy production and supply company.”

International Supply and Bunkering (ISB)

Sales volumes for this segment surged 128.2% to 8.9 million tonnes during the 12-month period ending 30th June 2011.

In addition to its existing marine bunkering operations in major ports that include Shenzhen, Shanghai, Ningbo, Zhoushan, Singapore, Hong Kong, Rotterdam and Tanjung Pelepas in Malaysia, the company expanded its network by making its debut operation at the port of New Orleans in May 2011, marking the company’s first foray into the US marine bunkering market.

As storage remains a key element in the overall competitiveness and capacity to supply fuel to its marine customers and other counterparties, Brightoil Petroleum says it is is also seeking opportunities to lease storage and terminal facilities from local operators.

During the period, Brightoil increased its commitment to establishing a global footprint with storage leases on the US West Coast, the Gulf Coast, the Bahamas, Rotterdam and Singapore, as well as in key locations across China. According to Brightoil, this initiative has enabled the company to enhance the quality of services to customers both in China and at other ports where their ships conduct operations.

With sustained growth in demand for marine bunkering as well as the contribution from the company’s oil trading business, total sales volumes of fuel oil, gasoil and condensate have increased significantly to 8.9 million tonnes, compared to 3.9 million tonnes in the same period last year, generating a revenue of HK$39.45 billion and representing a significant increase over the previous year’s revenue of HK$13.60 billion.

During the review period, the company opened trading offices in Singapore and Houston to provide essential logistical support for the expansion of its marine bunkering business. It has also recruited experienced trading professionals to boost the company’s supply capabilities and enhance its competitiveness.

Oil Storage & Terminal

To facilitate the logistical infrastructure necessary for the expansion of its bunkering and trading businesses, Brightoil says it has been actively focused on investments in strategic storage assets.

The company’s major investments in oil storage and terminal facilities focus on the main markets of East China and North China, specifically Zhoushan and Dalian. On Dalian’s Changxing Island, the group is constructing one of the largest storage infrastructure hubs in the world with capacity reaching up to 7.7 million cubic meters. The hub will have the capacity to handle imports of crude oil and fuel oil in VLCCs of around 300,000MT.

In East China, the group is building a major import and transshipment facility on Waidiao Island in Zhoushan, Zhejiang Province. The total capacity of the storage facility will be up to 2.2 million cubic meters and a letter of intent has been signed with the Zhoushan municipal government to expand the capacity further to up to 3.2 million cubic meters.

The development of both projects is progressing with the reclamation of land and dredging for Phase 1 of both projects starting in June (for Dalian) and July (Zhoushan) 2010. Construction work on the main facilities, including storage tanks, pipelines, access roads, and other infrastructure for both projects commenced in mid-2011. The Zhoushan project is slated for completion at the end of 2012 and the Dalian project is due to be completed in 2013.

Marine Transportation

Brightoil is engaged in an ongoing process of establishing a fleet of ocean-going oil tankers to complete the supply chain from its supply sources to the point of delivery.

From November 2009 to October 2010, the company took delivery of four Aframax vessels capable of carrying between 107,500-115,000 DWT of cargo. These vessels have been deployed to transport fuel oil from Singapore to China, as well as to service other routes for the group and for third parties.

On 30th August 2010, taking advantage of the reduction in costs charged by shipyards as the shipping market moved into a difficult trading period, the company entered into five shipbuilding contracts with Hyundai Heavy Industries Co. Ltd. to purchase five Very Large Crude Carriers (VLCCs), each weighing 318,000 DWT. The five VLCCs are expected to be delivered between July 2012 and March 2013.

Upstream Business

The focus of the group’s upstream business during the period has been the completion of the Overall Development Plan (ODP) for the Tuzi Natural Gas Field in the Xinjiang Uygur Autonomous Region.

The first draft of the ODP was submitted to the China National Petroleum Corporation (CNPC) at the end of December 2010. The approval process by the relevant government authorities for review and approval is expected to take up to one year from initial submission. While this process is ongoing, the group says it is exploring other avenues to accelerate development activities at Tuzi so that it can reach its target production date by the end of December 2011.

Commenting on the upstream business as the focus for future development, Dr. Sit commented, “With the launch of the Tuzi Natural Gas Development Project, our first upstream project, we believe that the upstream business will become an important source of revenue for the company by 2012. As our downstream operations continue to serve as a solid support, we will continue to actively seek projects that will broaden the appeal of our upstream business, including the exploitation and development of oil and gas fields globally.”

“We will continue to execute our growth strategy to diversify revenue streams for future growth while also reinforcing our solid foundations and the sustainability of our core businesses. Leveraging continued economic growth as well as rapid industrialization and urbanization in China, which have boosted domestic demand for energy, we will continue to strive for the integration of our value chain in the energy sector so as to become one of the leading global energy conglomerates in the world, with a view to creating greater value and higher returns to our shareholders.” Dr. Sit concluded.