Shanghai: Shares in PetroChina, a listed unit of China's largest oil producer, jumped on Tuesday after it unveiled plans to spin off a multi-billion-dollar pipeline business as the government seeks to diversify state ownership.
China in November announced a package of policies aimed at loosening authorities' grip on the world's second largest economy after a key Communist Party meeting known as the Third Plenum, including allowing greater use of private capital in sectors traditionally monopolised by the state.
PetroChina, a unit of China National Petroleum Corp, said it would transfer two pipelines carrying natural gas from the country's resource-rich west to its developed coast to a new subsidiary, according to a statement on its website.
It will then transfer its interest in the firm, to be called Eastern Pipelines, to other parties at a later date, said the statement released Monday.
Eastern Pipelines, to be set up in China's commercial hub Shanghai, will have assets of 82 billion yuan ($13 billion), the statement added.
The move will "diversify the ownership" of PetroChina, as well as optimise resource allocation and the company structure, it said.
PetroChina closed up 0.79 percent at 7.65 yuan ($1.23) in Shanghai trading on Tuesday and finished 2.78 percent higher at HK$9.24 ($1.19) in Hong Kong following the news.
In another economic reform announced at the plenum, China has increased the dividends that state firms must pay to the government from this year.
Most state-owned enterprises will now pay between 10 and 25 percent of their profits in dividends -- the portion of a company's earnings distributed to shareholders.
PetroChina's net profit jumped 12.4 percent year-on-year to 129.6 billion yuan in 2013 despite what the company said was a "complex" global and domestic economic environment. Its revenue rose an annual 2.9 percent to 2.3 trillion yuan last year.
