The Hong Kong-listed shares of oil giant PetroChina Co Ltd and its natural gas distribution arm Kunlun Energy tumbled Wednesday after they said several senior executives at the group were being investigated over alleged wrongdoing.

PetroChina shares slid 4.39 percent to HK$8.27 ($1.07) Wednesday, a day after the company issued a statement saying three executives had resigned.

Shares in Kunlun Energy plunged 13.51 percent to HK$10.88.

The news has undermined investor confidence in the State-controlled companies which have been the key beneficiaries of a rapid rise in the mainland ' s natural gas consumption and market-oriented natural gas and oil product pricing reform.

"Kunlun is the big loser here," said Simon Powell, head of Asia oil and gas research at CLSA in Hong Kong. "There will be no asset injection into Kunlun from PetroChina for a long time."

PetroChina has injected a combined 24 billion yuan ($3.9 billion) worth of pipeline and LNG terminal assets in Kunlun since 2008, Powell estimated.

Morgan Stanley analyst Andy Meng advised stock investors to switch away from PetroChina to Sinopec Corp and CNOOC, the other two mainland oil giants.

"Given the uncertainty, and the potential for a lengthy legal process to unfold, it is possible that the situation could weigh on PetroChina ' s stock price," he wrote in a note to clients.