28 August 2013, Beijing – A high-level government probe into corruption at China’s leading oil and gas firm has widened, with three additional senior officials at the state-run giant being investigated over alleged wrongdoing.
The announcement by the State-Owned Assets Supervision and Administration Commission, SASAC, which oversees China’s state companies, followed a notice the day before on a probe into another top official at China National Petroleum Corporation, CNPC, parent of Hong Kong-listed PetroChina Company.
“The three senior officials have been put under investigation for “severe breaches of discipline,” SASAC said, employing the shorthand the Chinese government uses to describe graft.
The investigations, which come amid an anti-corruption campaign by Chinese President Xi Jinping, were announced shortly after the close of the trial of Bo Xilai, once a rising political star who is now awaiting a verdict on charges of corruption, bribery and abuse of power.
The Bo trial, with the details it yielded of alleged excess funded by bribes given by business executives seeking to curry favour with Bo, have shone a spotlight on China’s struggle with corruption, giving Xi an incentive to show he is tackling it.
SASAC said CNPC group deputy general manager Li Hualin, vice-president of listed unit PetroChina Ran Xinquan, and PetroChina chief geologist Wang Daofu are all under investigation. It did not detail the accusations against them.
On Monday, the Ministry of Supervision said CNPC vice-president Wang Yongchun had been put under investigation for disciplinary breaches, without going into further detail.A CNPC spokesman confirmed that Wang Yongchun had resigned from his post. PetroChina said in a filing to the Hong Kong stock exchange that Li, Ran and Wang Daofu had also resigned. None of the four individuals was available for comment.
A PetroChina spokesman said the company “does not tolerate any official involved in corruption or other crimes,” but said the investigation would not affect the company’s operations.
Shares of PetroChina were suspended from trading earlier on Tuesday pending the announcement on the investigation.
The investigation into the state-owned firm’s officials appears to represent a widening of a campaign by President Xi to tackle corruption at every level of government, which he has said threatens the very survival of the ruling Communist Party.
“For many government agencies, corruption has become endemic; institutional corruption is systemic,” said Qiu Feng of the Unirule Institute of Economics, a think-tank in Beijing.
Underscoring the difficulty of the task, the Communist Party conceded in a statement following a meeting of its top leadership on Tuesday that corruption was still rampant.
“The soil that breeds corruption still exists. The anti-corruption struggle is still severe and complicated,” it said.
In recent weeks, China has launched a probe into graft in the pharmaceutical sector that has led to accusations of bribery against foreign drugmakers including GlaxoSmithKline, which has said some of its senior Chinese executives appear to have broken the law.
An investigation is also underway into a former senior executive with China Mobile. The former head of China’s energy administration, Liu Tienan, who was removed from his post in May on charges of corruption, is also expected to face prosecution.
PetroChina’s Ran was seen as a rising star in the company after turning the Changqing oil and gas field in northern China into a major producer.
Li, who was vice president of listed arm PetroChina, was also chairman of Kunlun Energy Co Ltd, a rapidly growing firm that specialises in the LNG business.
Li once served as secretary of Zhou Yongkang, who until last year was the country’s domestic security tsar and a member of the Politburo Standing Committee, the top echelon of power within the Communist Party. Zhou served as general manager of CNPC from 1996-98.
Three of Zhou’s other allies are currently under investigation, including the deputy party boss of Sichuan province, Li Chuncheng, who had for many years overseen development of the province’s prosperous capital, Chengdu.
However, Unirule’s Qiu said the problem was so entrenched that it would take more than a few investigations to root out.
“Just arresting a couple of leaders is not going to solve the problem, though of course in the short term it will produce a positive result,” said Qiu.