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Thursday, 22 May 14
CNPC-GAZPROM DEAL A MEDIUM - TERM POSITIVE FOR CHINA'S GAS SECTOR
 Fitch Ratings says a 30-year deal in which Russia's OAO Gazprom (BBB/Negative) will supply gas to China National Petroleum Corporation (CNPC; A+/Stable) underscores CNPC's strategic role in the country's gas pipeline infrastructure and helps China to secure adequate gas supply over the medium term, especially for the north-eastern part of the country.
Under the deal, Gazprom will supply 38 billion cubic metres (bcm) of gas a year starting around 2018 at a price that sets a new benchmark for what China is willing to pay for natural gas over longer term contracts.
The agreement also demonstrates China's determination to switch to cleaner energy. China used around 168bcm of natural gas in 2013 and aims to use over 400bcm in 2020. The import agreement will meet close to 10% of China's consumption of natural gas in the medium term. Although China has substantial gas resources, exploiting the large unconventional reserves is technologically challenging. In 2013, the country imported nearly 30% of its gas requirement. We expect imports to increase as a share of total consumption in the medium term.
The new deal helps diversify the sources of China's natural gas imports, now mainly Turkmenistan and shipments of liquefied natural gas (LNG). It follows an agreement by CNPC in 2013 to take an equity stake in a Russian LNG project and buy gas from the project, which is controlled by Russia's OAO Novatek (BBB-/Stable).
While pricing for the Gazprom deal has yet to be announced, it appears from numbers reported in the media that the price will likely be at or above USD350 per thousand cubic metres (CNY2.2 per cubic meter), which is about 60% cheaper than China's current LNG imports and similar to the price for imports from central Asia. Although Fitch does not expect LNG imports to fall significantly because the use of natural gas in China is increasing, the agency believes the Gazprom deal will help reduce upward pressure on import prices in the medium term.
China has been and will continue to increase domestic gas selling prices that are controlled by the state, which should ensure profitability for operators like CNPC. For example, following gas price increases to-date, CNPC reported profits in its mid-stream gas operations in 4Q14 after losses during which high import costs sapped profitability.
For domestic gas producers, the Gazprom deal will provide incentive to further invest in natural gas exploration and production because the deal's expected price is higher than domestic production and as the authorities are expected to liberalise domestic natural gas pricing in the next couple of years. The indicative Gazprom deal price is at least 40% more than the current spot price for domestic gas, which ranges from CNY1 to CNY1.6 per cubic meter. Fitch believes the Gazprom deal is positive for CNPC, which holds over 60% of China's gas reserves and whose realised natural gas prices from its domestic productions in 2013 were around USD180 per thousand cubic metres.
CNPC will be responsible for building the pipelines and storage facilities in China under the deal. That the state has tasked CNPC to take on such important responsibility indicates that CNPC continues to play a strategic role in China's gas infrastructure, even though its subsidiary PetroChina said in May 2014 that it would eventually sell all of its stake in the First and the Second West-East Gas Pipeline to private investors.
To domestic city gas operators, especially in the north-eastern region, the deal soothes the concerns about gas supplies over the medium term. In Fitch's view, the agreement is positive for city gas operators such as China Resources Gas (BBB+/Stable), ENN Energy (BBB/Positive) and China Gas Holdings.
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Saturday, 25 March 23
COAL INDIA HAS STRONG CASE TO INCREASE PRICES, TALKS ON: CMD AGRAWAL - BUSINESS STANDARD
Coal India (CIL) Chairman and Managing Director Pramod Agrawal said on Monday there is a “strong case” for increasing coal prices, and ...
Saturday, 25 March 23
ASIAN CRUDE PALM OIL WATCH 1Q23 - FITCH RATINGS
Malaysian benchmark crude palm oil (CPO) spot prices have averaged around USD915 per tonne (t) so far in 1Q23, sharply lower than the average of ar ...
Saturday, 25 March 23
INDONESIA’S COAL EXPORT INCREASED BY 21.0% YOY TO 388.4 MLN T IN 2022 - BANCHERO COSTA
After a slow start in the first quarter, global coal trade has really picked up pace last year, and is now fully back to pre-Covid levels. In the f ...
Saturday, 25 March 23
GLOBAL LNG-ASIA SPOT PRICES SLIP AS WEAK NORTHERN DEMAND REMAINS - REUTERS
Asian spot prices of liquefied natural gas (LNG) declined this week, falling to a 21-month low, as weak demand in the northeast Asia region continu ...
Wednesday, 22 March 23
OIL PRICE FALL SPECULATIVE, TO HIT $140 BY YEAR-END -ANDURAND: REUTERS
The recent fall in oil prices due to banking jitters is speculative and oil will hit $140 a barrel by the end of the year, hedge fund manager Pierr ...
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- Thai Mozambique Logistica
- Posco Energy - South Korea
- Coalindo Energy - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- PTC India Limited - India
- Wood Mackenzie - Singapore
- Jindal Steel & Power Ltd - India
- Ministry of Transport, Egypt
- Indonesian Coal Mining Association
- Bhatia International Limited - India
- Essar Steel Hazira Ltd - India
- Agrawal Coal Company - India
- Bangladesh Power Developement Board
- Makarim & Taira - Indonesia
- Minerals Council of Australia
- Coal and Oil Company - UAE
- Indian Oil Corporation Limited
- Power Finance Corporation Ltd., India
- Goldman Sachs - Singapore
- New Zealand Coal & Carbon
- Central Electricity Authority - India
- Renaissance Capital - South Africa
- Global Coal Blending Company Limited - Australia
- Energy Development Corp, Philippines
- Grasim Industreis Ltd - India
- The Treasury - Australian Government
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Larsen & Toubro Limited - India
- Karbindo Abesyapradhi - Indoneisa
- TNB Fuel Sdn Bhd - Malaysia
- Bukit Asam (Persero) Tbk - Indonesia
- Edison Trading Spa - Italy
- Deloitte Consulting - India
- Economic Council, Georgia
- Kaltim Prima Coal - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Miang Besar Coal Terminal - Indonesia
- Orica Australia Pty. Ltd.
- Oldendorff Carriers - Singapore
- Electricity Authority, New Zealand
- Vizag Seaport Private Limited - India
- CNBM International Corporation - China
- San Jose City I Power Corp, Philippines
- Ind-Barath Power Infra Limited - India
- Meralco Power Generation, Philippines
- Altura Mining Limited, Indonesia
- Meenaskhi Energy Private Limited - India
- Siam City Cement - Thailand
- Tata Chemicals Ltd - India
- Kideco Jaya Agung - Indonesia
- International Coal Ventures Pvt Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- SN Aboitiz Power Inc, Philippines
- Directorate General of MIneral and Coal - Indonesia
- PNOC Exploration Corporation - Philippines
- LBH Netherlands Bv - Netherlands
- Therma Luzon, Inc, Philippines
- Ministry of Mines - Canada
- AsiaOL BioFuels Corp., Philippines
- Uttam Galva Steels Limited - India
- Samtan Co., Ltd - South Korea
- Ceylon Electricity Board - Sri Lanka
- SMG Consultants - Indonesia
- The State Trading Corporation of India Ltd
- Bank of Tokyo Mitsubishi UFJ Ltd
- White Energy Company Limited
- OPG Power Generation Pvt Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Bukit Makmur.PT - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Antam Resourcindo - Indonesia
- Borneo Indobara - Indonesia
- Chamber of Mines of South Africa
- Petron Corporation, Philippines
- Globalindo Alam Lestari - Indonesia
- Ambuja Cements Ltd - India
- Siam City Cement PLC, Thailand
- Mjunction Services Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Global Green Power PLC Corporation, Philippines
- Kartika Selabumi Mining - Indonesia
- Indogreen Group - Indonesia
- CIMB Investment Bank - Malaysia
- Lanco Infratech Ltd - India
- Interocean Group of Companies - India
- Australian Commodity Traders Exchange
- Chettinad Cement Corporation Ltd - India
- IHS Mccloskey Coal Group - USA
- Iligan Light & Power Inc, Philippines
- Tamil Nadu electricity Board
- MS Steel International - UAE
- Bulk Trading Sa - Switzerland
- Attock Cement Pakistan Limited
- Coastal Gujarat Power Limited - India
- Toyota Tsusho Corporation, Japan
- Pipit Mutiara Jaya. PT, Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Mercuria Energy - Indonesia
- Salva Resources Pvt Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Anglo American - United Kingdom
- Heidelberg Cement - Germany
- Xindia Steels Limited - India
- Alfred C Toepfer International GmbH - Germany
- Kumho Petrochemical, South Korea
- Wilmar Investment Holdings
- Georgia Ports Authority, United States
- McConnell Dowell - Australia
- South Luzon Thermal Energy Corporation
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Electricity Generating Authority of Thailand
- Indika Energy - Indonesia
- Dalmia Cement Bharat India
- The University of Queensland
- Bayan Resources Tbk. - Indonesia
- Star Paper Mills Limited - India
- Carbofer General Trading SA - India
- Sarangani Energy Corporation, Philippines
- Simpson Spence & Young - Indonesia
- VISA Power Limited - India
- Bukit Baiduri Energy - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Thiess Contractors Indonesia
- Parliament of New Zealand
- Bhoruka Overseas - Indonesia
- Intertek Mineral Services - Indonesia
- Indo Tambangraya Megah - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Price Waterhouse Coopers - Russia
- IEA Clean Coal Centre - UK
- Semirara Mining Corp, Philippines
- Sindya Power Generating Company Private Ltd
- Africa Commodities Group - South Africa
- Indian Energy Exchange, India
- GVK Power & Infra Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Ministry of Finance - Indonesia
- Banpu Public Company Limited - Thailand
- Gujarat Electricity Regulatory Commission - India
- SMC Global Power, Philippines
- Romanian Commodities Exchange
- Standard Chartered Bank - UAE
- Malabar Cements Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Port Waratah Coal Services - Australia
- TeaM Sual Corporation - Philippines
- Aditya Birla Group - India
- Medco Energi Mining Internasional
- India Bulls Power Limited - India
- Baramulti Group, Indonesia
- Formosa Plastics Group - Taiwan
- GMR Energy Limited - India
- Karaikal Port Pvt Ltd - India
- Merrill Lynch Commodities Europe
- ICICI Bank Limited - India
- European Bulk Services B.V. - Netherlands
- Eastern Energy - Thailand
- Kobexindo Tractors - Indoneisa
- ASAPP Information Group - India
- Rio Tinto Coal - Australia
- Cement Manufacturers Association - India
- Bahari Cakrawala Sebuku - Indonesia
- Sree Jayajothi Cements Limited - India
- Riau Bara Harum - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Manunggal Multi Energi - Indonesia
- Commonwealth Bank - Australia
- Jaiprakash Power Ventures ltd
- Offshore Bulk Terminal Pte Ltd, Singapore
- Straits Asia Resources Limited - Singapore
- Holcim Trading Pte Ltd - Singapore
- Mintek Dendrill Indonesia
- Kapuas Tunggal Persada - Indonesia
- Trasteel International SA, Italy
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sical Logistics Limited - India
- Aboitiz Power Corporation - Philippines
- Planning Commission, India
- Eastern Coal Council - USA
- Bharathi Cement Corporation - India
- Central Java Power - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Bhushan Steel Limited - India
- Independent Power Producers Association of India
- Madhucon Powers Ltd - India
- PowerSource Philippines DevCo
- Maheswari Brothers Coal Limited - India
- Videocon Industries ltd - India
- Energy Link Ltd, New Zealand
- Global Business Power Corporation, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Kepco SPC Power Corporation, Philippines
- Latin American Coal - Colombia
- Directorate Of Revenue Intelligence - India
- Barasentosa Lestari - Indonesia
- Binh Thuan Hamico - Vietnam
- Mercator Lines Limited - India
- Singapore Mercantile Exchange
- Australian Coal Association
- Pendopo Energi Batubara - Indonesia
- London Commodity Brokers - England
- Parry Sugars Refinery, India
- Sojitz Corporation - Japan
- Cigading International Bulk Terminal - Indonesia
- GAC Shipping (India) Pvt Ltd
- Asmin Koalindo Tuhup - Indonesia
- Orica Mining Services - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Vedanta Resources Plc - India
- Gujarat Sidhee Cement - India
- Metalloyd Limited - United Kingdom
- Timah Investasi Mineral - Indoneisa
- Marubeni Corporation - India
- Savvy Resources Ltd - HongKong
- Sakthi Sugars Limited - India
- Vijayanagar Sugar Pvt Ltd - India
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