PetroChina, the country's largest oil producer, will issue up to 4 billion yuan-denominated A shares in its Shanghai initial public offering (IPO).

The oil giant could raise around 50 billion yuan (US$6.7 billion) based on the closing H share price of 12.38 HK dollars on Thursday, the Shanghai Securities News reported Friday.

The 4 billion A shares accounted for 2.18 percent of its expanded capital after the IPO, the company said in a prospectus filed to the China Securities Regulatory Commission (CSRC).

PetroChina will use 6.84 billion yuan and 5.93 billion yuan respectively to boost production capacity at its Changqing and Daqing oil fields. It will use 1.5 billion yuan to build production facilities in Jidong field, the country's biggest.

It also plans to invest 17.5 billion yuan in upgrading its Dushanzi oil refinery and ethylene facilities and 6 billion yuan in expanding an ethylene plant in Daqing, in northeast China.

If the proceeds exceeded the investment in the projects, the extra would be used to supplement its liquid capital and other commercial purposes. But if it failed to raise adequate funds, the firm would use bank loans or its own cash, the prospectus stated.

Citic Securities Co., UBS Securities Co. and China International Capital Corp are arranging the share issue.

The CSRC will review the IPO plan next Monday.

(Xinhua News Agency September 21, 2007)