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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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Tuesday, 17 January 23
CHINA'S SHANXI TARGETS 2023 COAL PRODUCTION OF NEARLY 1.37B TONS - XINHUA
China’s coal-rich province of Shanxi has set a coal production target of nearly 1.37 billion metric tons for 2023, according to a government ...
Tuesday, 17 January 23
MARKET INSIGHT - INTERMODAL
Rumor has it that the New Year has come, to set the pace in, for Russia to continue hostilities against Ukraine. Ten months on the go, into Russia& ...
Tuesday, 17 January 23
INDONESIA IS ACCOUNTING FOR 32.3% OF THE GLOBAL SEABORNE COAL MARKET IN 2022 - BENCHERO 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, Benchero ...
Tuesday, 10 January 23
INDONESIAN HBA IS SEEING A SPIKE IN JANUARY 2023 INSTEAD OF A SIGNIFICANT FALL IN DECEMBER 2022
COALspot.com: Indonesian Coal Price Reference up 8.43% in January 2023.
HBA is seeing a dramatic spike in January 2023 i ...
Sunday, 08 January 23
INDIAN COAL POWER PLANTS SHOULD BE COMPENSATED FOR 2022 FORCED GENERATION – REGULATOR : REUTERS
Indian power plants that rely on imported coal should be fully compensated when forced to supply electricity, the country’s power regulator s ...
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- Larsen & Toubro Limited - India
- Port Waratah Coal Services - Australia
- Oldendorff Carriers - Singapore
- European Bulk Services B.V. - Netherlands
- Jindal Steel & Power Ltd - India
- Ministry of Finance - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Simpson Spence & Young - Indonesia
- CIMB Investment Bank - Malaysia
- Eastern Energy - Thailand
- Coalindo Energy - Indonesia
- Mintek Dendrill Indonesia
- Thiess Contractors Indonesia
- Parry Sugars Refinery, India
- Grasim Industreis Ltd - India
- Ministry of Transport, Egypt
- Neyveli Lignite Corporation Ltd, - India
- LBH Netherlands Bv - Netherlands
- Pendopo Energi Batubara - Indonesia
- Global Business Power Corporation, Philippines
- Ceylon Electricity Board - Sri Lanka
- Latin American Coal - Colombia
- Australian Commodity Traders Exchange
- Thai Mozambique Logistica
- McConnell Dowell - Australia
- Electricity Authority, New Zealand
- Global Coal Blending Company Limited - Australia
- San Jose City I Power Corp, Philippines
- Aditya Birla Group - India
- Renaissance Capital - South Africa
- Sical Logistics Limited - India
- Coastal Gujarat Power Limited - India
- Directorate Of Revenue Intelligence - India
- ASAPP Information Group - India
- Australian Coal Association
- Uttam Galva Steels Limited - India
- Interocean Group of Companies - India
- Georgia Ports Authority, United States
- Bahari Cakrawala Sebuku - Indonesia
- Global Green Power PLC Corporation, Philippines
- Straits Asia Resources Limited - Singapore
- Essar Steel Hazira Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Indian Energy Exchange, India
- Africa Commodities Group - South Africa
- The State Trading Corporation of India Ltd
- Energy Link Ltd, New Zealand
- Gujarat Sidhee Cement - India
- GMR Energy Limited - India
- Cigading International Bulk Terminal - Indonesia
- SN Aboitiz Power Inc, Philippines
- Meralco Power Generation, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Merrill Lynch Commodities Europe
- Meenaskhi Energy Private Limited - India
- Kapuas Tunggal Persada - Indonesia
- Madhucon Powers Ltd - India
- Tamil Nadu electricity Board
- Ambuja Cements Ltd - India
- Chamber of Mines of South Africa
- Jaiprakash Power Ventures ltd
- Mercator Lines Limited - India
- Semirara Mining and Power Corporation, Philippines
- Medco Energi Mining Internasional
- Bhatia International Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Aboitiz Power Corporation - Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Indian Oil Corporation Limited
- The Treasury - Australian Government
- IEA Clean Coal Centre - UK
- Dalmia Cement Bharat India
- Petrochimia International Co. Ltd.- Taiwan
- Krishnapatnam Port Company Ltd. - India
- PNOC Exploration Corporation - Philippines
- Iligan Light & Power Inc, Philippines
- Kobexindo Tractors - Indoneisa
- Bharathi Cement Corporation - India
- Star Paper Mills Limited - India
- Sojitz Corporation - Japan
- Asmin Koalindo Tuhup - Indonesia
- Sinarmas Energy and Mining - Indonesia
- IHS Mccloskey Coal Group - USA
- Vedanta Resources Plc - India
- Leighton Contractors Pty Ltd - Australia
- Therma Luzon, Inc, Philippines
- Eastern Coal Council - USA
- Kartika Selabumi Mining - Indonesia
- Kepco SPC Power Corporation, Philippines
- Anglo American - United Kingdom
- GVK Power & Infra Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Posco Energy - South Korea
- Attock Cement Pakistan Limited
- SMC Global Power, Philippines
- Wood Mackenzie - Singapore
- PTC India Limited - India
- Energy Development Corp, Philippines
- Orica Mining Services - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Cement Manufacturers Association - India
- Tata Chemicals Ltd - India
- Timah Investasi Mineral - Indoneisa
- Bukit Makmur.PT - Indonesia
- Sindya Power Generating Company Private Ltd
- Power Finance Corporation Ltd., India
- GAC Shipping (India) Pvt Ltd
- Singapore Mercantile Exchange
- Rio Tinto Coal - Australia
- Sarangani Energy Corporation, Philippines
- Semirara Mining Corp, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Sakthi Sugars Limited - India
- AsiaOL BioFuels Corp., Philippines
- Binh Thuan Hamico - Vietnam
- Wilmar Investment Holdings
- South Luzon Thermal Energy Corporation
- Kohat Cement Company Ltd. - Pakistan
- Miang Besar Coal Terminal - Indonesia
- Minerals Council of Australia
- Riau Bara Harum - Indonesia
- Videocon Industries ltd - India
- India Bulls Power Limited - India
- Bhoruka Overseas - Indonesia
- Globalindo Alam Lestari - Indonesia
- Bangladesh Power Developement Board
- Commonwealth Bank - Australia
- Deloitte Consulting - India
- Xindia Steels Limited - India
- Central Electricity Authority - India
- MS Steel International - UAE
- The University of Queensland
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- PowerSource Philippines DevCo
- International Coal Ventures Pvt Ltd - India
- Sree Jayajothi Cements Limited - India
- Planning Commission, India
- Central Java Power - Indonesia
- Mercuria Energy - Indonesia
- Banpu Public Company Limited - Thailand
- Bulk Trading Sa - Switzerland
- Baramulti Group, Indonesia
- Trasteel International SA, Italy
- Economic Council, Georgia
- Ministry of Mines - Canada
- Samtan Co., Ltd - South Korea
- Independent Power Producers Association of India
- VISA Power Limited - India
- SMG Consultants - Indonesia
- Vizag Seaport Private Limited - India
- Petron Corporation, Philippines
- Indonesian Coal Mining Association
- Directorate General of MIneral and Coal - Indonesia
- Borneo Indobara - Indonesia
- White Energy Company Limited
- Indika Energy - Indonesia
- Maheswari Brothers Coal Limited - India
- TeaM Sual Corporation - Philippines
- Marubeni Corporation - India
- Antam Resourcindo - Indonesia
- Mjunction Services Limited - India
- Barasentosa Lestari - Indonesia
- Bayan Resources Tbk. - Indonesia
- Carbofer General Trading SA - India
- Holcim Trading Pte Ltd - Singapore
- Malabar Cements Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Ind-Barath Power Infra Limited - India
- Formosa Plastics Group - Taiwan
- Intertek Mineral Services - Indonesia
- Parliament of New Zealand
- Karaikal Port Pvt Ltd - India
- Electricity Generating Authority of Thailand
- Chettinad Cement Corporation Ltd - India
- Makarim & Taira - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Metalloyd Limited - United Kingdom
- OPG Power Generation Pvt Ltd - India
- Indogreen Group - Indonesia
- Billiton Holdings Pty Ltd - Australia
- ICICI Bank Limited - India
- CNBM International Corporation - China
- Agrawal Coal Company - India
- Kideco Jaya Agung - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Toyota Tsusho Corporation, Japan
- Altura Mining Limited, Indonesia
- Heidelberg Cement - Germany
- Siam City Cement PLC, Thailand
- Coal and Oil Company - UAE
- Bukit Baiduri Energy - Indonesia
- Kumho Petrochemical, South Korea
- Manunggal Multi Energi - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Price Waterhouse Coopers - Russia
- Rashtriya Ispat Nigam Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Edison Trading Spa - Italy
- Savvy Resources Ltd - HongKong
- Siam City Cement - Thailand
- New Zealand Coal & Carbon
- London Commodity Brokers - England
- Standard Chartered Bank - UAE
- Kaltim Prima Coal - Indonesia
- Goldman Sachs - Singapore
- Maharashtra Electricity Regulatory Commission - India
- Indo Tambangraya Megah - Indonesia
- Romanian Commodities Exchange
- Karbindo Abesyapradhi - Indoneisa
- Bank of Tokyo Mitsubishi UFJ Ltd
- Orica Australia Pty. Ltd.
- Lanco Infratech Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Salva Resources Pvt Ltd - India
- Bhushan Steel Limited - India
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