Via Stratfor (subscription required), an in-depth look at recent consideration by China’s state-owned energy giant PetroChina to acquire smaller foreign energy companies that have been weakened by the global financial contagion.  As the article notes, while PetroChina stands to benefit from such acquisitions — as do China’s energy-craving domestic industries and markets — the company’s interests diverge from those of the Communist Party of China (CPC)

“…It is therefore a good time for PetroChina to think about buying up energy assets abroad. PetroChina stands on relatively solid financial ground, as the central government bankrolls its parent company, China National Petroleum Corp. (CNPC). CNPC is a powerful organ of Beijing’s control over China’s energy sector, and Beijing has little choice but to support it financially. A weakened CNPC would lead to a grinding slowdown in industry and commerce, as well as layoffs — something Beijing intends to avoid at all costs.

But PetroChina is not entirely subservient to the central government, and in fact the two are increasingly at odds over major questions. The central government wants to use the state-owned enterprise as a tool to maintain social stability and national security. It sees the company as a major employer and the guarantor of China’s energy supply through both its acquisitions of petroleum reserves abroad and its refining and distribution of petroleum products for consumption at home. Political leaders have attempted to tighten control over CNPC and PetroChina as well as other state-owned energy companies such as China Petroleum & Chemical Corp. (Sinopec) through numerous bureaucratic and regulatory schemes, including plans to create an overarching Energy Ministry. But these efforts have had mixed results.

On some occasions, the state-run energy companies have even defied direct government mandates. In March, distribution problems following snowstorms left entire regions without fuel, while state-run energy companies withheld their supplies in hopes of making a bigger profit elsewhere. Again in June, commodity inflation caused input prices to climb so high for oil refineries that they were forced to operate at a loss. (PetroChina registered losses of $8.6 billion from January to June, compared to $571 million profit in the same period last year.) But some retailers set their own prices anyway. Though outright defiance is rare, increasingly volatile global conditions will give plenty of occasions for such disagreements to arise in the future.

Internationally, PetroChina competes in a world full of energy companies, including Western supermajors like ExxonMobil and BP and rival national champions like Russia’s Rosneft, South Korea’s Korea National Oil Corp. and Malaysia’s Petronas. The company cannot effectively compete in the global race for resources when it is shackled by inefficient labor and price controls and government fiat back in China. As PetroChina attempts to become a top international energy firm, it must act in its own interest rather than in the interest of its detractors in the central government.

Of course, China’s state energy companies have advocates within various branches of government and at the highest levels. And the energy firms depend on government subsidies as much as they abhor government price controls. If these companies’ power and influence increases, differences in the core leadership and factionalism will multiply. So while now may be an opportune time for PetroChina to go on a shopping spree for energy assets around the world, by doing so it will increase strains within the CPC.”