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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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Friday, 18 November 22
REALITIES OF LOI LIABILITIES - BALTIC EXCHANGE
KNOWLEDGE TO ELEVATE
The cargo misdelivery claim in Trafigura Maritime Logistics Pte Ltd v. Clearlake Shipping Pte Ltd (Miracle Hope) [2022] E ...
Tuesday, 15 November 22
CHINA SEES RISING COAL STORAGE AMID SUPPLY PUSH - XINHUA
Coal stockpiles at China’s power plants have seen considerable increases, ensuring energy supply for the winter, the country’s energy r ...
Tuesday, 15 November 22
SEABORNE THERMAL COAL PRICES START TO EASE, BUT PROCESS IS UNEVEN - REUTERS
Prices for seaborne thermal coal have started to drop as fears of a winter energy crunch ease, but the rate of decline has varied across the differ ...
Thursday, 10 November 22
INDIA: THERMAL PLANTS HAVE ADEQUATE COAL STOCKS AT 25.6 MILLION TONNES, SAYS GOVT - IANS
The coal stock with domestic dry fuel-based power plants, as on October 31, was 25.6 million tonnes, the government said, adding that the availabil ...
Tuesday, 08 November 22
OUTLOOK ON CHINA’S WEAKENED BASIC MATERIALS SECTOR CLOUDED BY POLICY SWINGS - FITCH RATINGS
Fitch Ratings expects basic materials demand in China to improve qoq in 4Q22, driven by seasonally higher construction activity, solid infrastructu ...
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- Orica Australia Pty. Ltd.
- Carbofer General Trading SA - India
- Grasim Industreis Ltd - India
- Siam City Cement PLC, Thailand
- Indian Oil Corporation Limited
- Planning Commission, India
- Global Coal Blending Company Limited - Australia
- Meralco Power Generation, Philippines
- Tata Chemicals Ltd - India
- Marubeni Corporation - India
- Xindia Steels Limited - India
- Therma Luzon, Inc, Philippines
- Larsen & Toubro Limited - India
- London Commodity Brokers - England
- Wood Mackenzie - Singapore
- Borneo Indobara - Indonesia
- Coastal Gujarat Power Limited - India
- Intertek Mineral Services - Indonesia
- Indian Energy Exchange, India
- Maharashtra Electricity Regulatory Commission - India
- Standard Chartered Bank - UAE
- Parry Sugars Refinery, India
- Electricity Authority, New Zealand
- Bhoruka Overseas - Indonesia
- McConnell Dowell - Australia
- Goldman Sachs - Singapore
- Kalimantan Lumbung Energi - Indonesia
- Metalloyd Limited - United Kingdom
- Karaikal Port Pvt Ltd - India
- Lanco Infratech Ltd - India
- Bayan Resources Tbk. - Indonesia
- Central Electricity Authority - India
- Thai Mozambique Logistica
- San Jose City I Power Corp, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kumho Petrochemical, South Korea
- Sindya Power Generating Company Private Ltd
- Independent Power Producers Association of India
- GN Power Mariveles Coal Plant, Philippines
- Baramulti Group, Indonesia
- Kartika Selabumi Mining - Indonesia
- Singapore Mercantile Exchange
- Uttam Galva Steels Limited - India
- Eastern Energy - Thailand
- Georgia Ports Authority, United States
- Globalindo Alam Lestari - Indonesia
- Bharathi Cement Corporation - India
- OPG Power Generation Pvt Ltd - India
- Salva Resources Pvt Ltd - India
- Australian Coal Association
- Maheswari Brothers Coal Limited - India
- Electricity Generating Authority of Thailand
- Energy Development Corp, Philippines
- SMC Global Power, Philippines
- The State Trading Corporation of India Ltd
- Anglo American - United Kingdom
- Economic Council, Georgia
- Cement Manufacturers Association - India
- Asmin Koalindo Tuhup - Indonesia
- Sical Logistics Limited - India
- Mercator Lines Limited - India
- Edison Trading Spa - Italy
- Directorate General of MIneral and Coal - Indonesia
- Sojitz Corporation - Japan
- Mjunction Services Limited - India
- GAC Shipping (India) Pvt Ltd
- Iligan Light & Power Inc, Philippines
- SN Aboitiz Power Inc, Philippines
- Semirara Mining and Power Corporation, Philippines
- Bangladesh Power Developement Board
- European Bulk Services B.V. - Netherlands
- Leighton Contractors Pty Ltd - Australia
- Rashtriya Ispat Nigam Limited - India
- Savvy Resources Ltd - HongKong
- Malabar Cements Ltd - India
- MS Steel International - UAE
- Trasteel International SA, Italy
- Gujarat Sidhee Cement - India
- Bukit Asam (Persero) Tbk - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Kaltim Prima Coal - Indonesia
- The University of Queensland
- Jindal Steel & Power Ltd - India
- CNBM International Corporation - China
- Kideco Jaya Agung - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Makarim & Taira - Indonesia
- Chettinad Cement Corporation Ltd - India
- Aboitiz Power Corporation - Philippines
- Ministry of Finance - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Rio Tinto Coal - Australia
- PNOC Exploration Corporation - Philippines
- Semirara Mining Corp, Philippines
- Indika Energy - Indonesia
- Binh Thuan Hamico - Vietnam
- Gujarat Electricity Regulatory Commission - India
- Ind-Barath Power Infra Limited - India
- Orica Mining Services - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Dalmia Cement Bharat India
- Thiess Contractors Indonesia
- Renaissance Capital - South Africa
- Agrawal Coal Company - India
- PetroVietnam Power Coal Import and Supply Company
- Indo Tambangraya Megah - Indonesia
- International Coal Ventures Pvt Ltd - India
- Ambuja Cements Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Toyota Tsusho Corporation, Japan
- White Energy Company Limited
- Minerals Council of Australia
- Siam City Cement - Thailand
- GVK Power & Infra Limited - India
- Indonesian Coal Mining Association
- Videocon Industries ltd - India
- Directorate Of Revenue Intelligence - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Global Green Power PLC Corporation, Philippines
- Sakthi Sugars Limited - India
- Eastern Coal Council - USA
- Merrill Lynch Commodities Europe
- Central Java Power - Indonesia
- Price Waterhouse Coopers - Russia
- Star Paper Mills Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Timah Investasi Mineral - Indoneisa
- Essar Steel Hazira Ltd - India
- Medco Energi Mining Internasional
- IEA Clean Coal Centre - UK
- Billiton Holdings Pty Ltd - Australia
- Cigading International Bulk Terminal - Indonesia
- Sarangani Energy Corporation, Philippines
- Vedanta Resources Plc - India
- Africa Commodities Group - South Africa
- Formosa Plastics Group - Taiwan
- Pendopo Energi Batubara - Indonesia
- PTC India Limited - India
- India Bulls Power Limited - India
- Tamil Nadu electricity Board
- Bukit Makmur.PT - Indonesia
- South Luzon Thermal Energy Corporation
- Altura Mining Limited, Indonesia
- Kapuas Tunggal Persada - Indonesia
- Deloitte Consulting - India
- Vizag Seaport Private Limited - India
- Barasentosa Lestari - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Mercuria Energy - Indonesia
- Straits Asia Resources Limited - Singapore
- Bhushan Steel Limited - India
- Romanian Commodities Exchange
- Oldendorff Carriers - Singapore
- The Treasury - Australian Government
- Kohat Cement Company Ltd. - Pakistan
- Karbindo Abesyapradhi - Indoneisa
- Power Finance Corporation Ltd., India
- Ministry of Transport, Egypt
- Indogreen Group - Indonesia
- Banpu Public Company Limited - Thailand
- Heidelberg Cement - Germany
- Ministry of Mines - Canada
- Sree Jayajothi Cements Limited - India
- Coalindo Energy - Indonesia
- Interocean Group of Companies - India
- Port Waratah Coal Services - Australia
- Petrochimia International Co. Ltd.- Taiwan
- Alfred C Toepfer International GmbH - Germany
- Samtan Co., Ltd - South Korea
- Bukit Baiduri Energy - Indonesia
- Antam Resourcindo - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Parliament of New Zealand
- Global Business Power Corporation, Philippines
- Jaiprakash Power Ventures ltd
- Kepco SPC Power Corporation, Philippines
- SMG Consultants - Indonesia
- PowerSource Philippines DevCo
- Wilmar Investment Holdings
- Bank of Tokyo Mitsubishi UFJ Ltd
- Ceylon Electricity Board - Sri Lanka
- Energy Link Ltd, New Zealand
- CIMB Investment Bank - Malaysia
- ICICI Bank Limited - India
- VISA Power Limited - India
- Kobexindo Tractors - Indoneisa
- Madhucon Powers Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- ASAPP Information Group - India
- Bulk Trading Sa - Switzerland
- Posco Energy - South Korea
- Miang Besar Coal Terminal - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- IHS Mccloskey Coal Group - USA
- LBH Netherlands Bv - Netherlands
- Mintek Dendrill Indonesia
- Australian Commodity Traders Exchange
- Petron Corporation, Philippines
- Holcim Trading Pte Ltd - Singapore
- Aditya Birla Group - India
- Chamber of Mines of South Africa
- Jorong Barutama Greston.PT - Indonesia
- Meenaskhi Energy Private Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Simpson Spence & Young - Indonesia
- Coal and Oil Company - UAE
- Commonwealth Bank - Australia
- Bhatia International Limited - India
- Attock Cement Pakistan Limited
- TeaM Sual Corporation - Philippines
- Manunggal Multi Energi - Indonesia
- New Zealand Coal & Carbon
- Latin American Coal - Colombia
- GMR Energy Limited - India
- Riau Bara Harum - Indonesia
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