China Shipping Development Co Ltd, the listed unit under China's largest oil shipping operator, reported earnings jumped by about 83.7 percent year-on-year during the past quarter, thanks to strong growth in oil imports this year.

During the July to September period, the company posted a net profit of 283.4 million yuan (US$34.14 million).

"Oil imports into China are rising rapidly this year, which means a great boost for our business," said Yao Qiaohong, the company's board secretary, in a telephone interview yesterday. "We do well in carrying imported oil to various ports around China."

The Shanghai-based company, currently the largest carrier in the domestic oil shipping sector with a 70-percent market share, had a turnover of 1.32 billion yuan in the three-month period, a 25.83-percent rise compared with the same period last year.

China Shipping also predicted its net profit will rise by more than half in 2003 compared with 2002.

But Yao admitted that the strong profit growth for the year could be attributed partly to the company's move to spin off an unprofitable asset last year.

Ma Ying, an industry analyst with Haitong Securities Co Ltd, said the company's core business of oil and coal shipping will continue to grow rapidly in the following years.

"The central government is encouraging domestic oil carriers to enter the oil import shipping market, which is now dominated by foreign shipping firms, said Ma. "With the government's support, it's easy for China Shipping to find a stable oil source from refiners like China Petroleum & Chemical Corp (Sinopec)."

According to Ma, the government hopes Chinese carriers will be able to garner half of the volume of transporting oil from foreign countries to China, which is now more than 90 percent controlled by foreign companies.

"The oil import business is rising and will continue to grow by more than 10 million tons a year in China," said Yao. "It's a good news for us.

China is expected to import more than 80 million tons of oil from abroad this year and the amount will top 100 million tons by 2005, said industry insiders.

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