We welcome article submissions from experts in the areas of coal, mining,
shipping, etc.
To Submit your article please click here.
|
|
|
Thursday, 15 January 15
LOW CASH COSTS, GOOD LIQUIDITY HELP ASIAN OIL COMPANIES IN PRICE ROUT - FITCH
 Fitch Ratings says that rated oil and gas production companies in Asia can comfortably operate under low oil prices for some time given their generally low cash production costs and strong liquidity. Fitch expects companies to further reduce capex if oil prices remain at current levels for a longer period.
Fitch further noted that, the fall of oil prices below USD50 per barrel is hurting cash generation and affecting investment decisions of companies in the sector. However, the impact on operating cash generation varies across Fitch-rated companies. South-east Asian companies, such as PTT Public Company Limited that produce more gas (60% or more of total production), will be less affected immediately compared with their north and south Asian counterparts that are more liquids-heavy. Liquids at companies like Petrochina, CNOOC, Sinopec, Oil India Ltd and MIE Holdings Corporation account for over 70% of total production in barrels of oil equivalent (boe) terms. Companies that hedged the prices of part of their oil production benefited from the protection in 2014, but they are likely to be exposed to market prices in 2015 because these types of hedges typically do not cover long periods.
Low cash production costs and the largely conventional upstream projects of the rated Asian oil companies provide them with additional flexibility in today's low oil price environment, said Fitch. While all-in costs (cash production costs plus depreciation, depletion and amortisation, or DD&A) are important in the long run, the relatively longer production lives of conventional oil and gas wells provide additional capex flexibility during periods of low hydrocarbon prices. Lifting costs in US dollars per boe are typically in the teens for the rated companies in Asia. Lower production tax requirements stemming from low realised prices, especially in China, also reduce the net impact of the oil price rout on operating cash generation. Companies are also looking to reduce opex, which can squeeze margins of oil field services companies.
Over the longer term though, with all-in costs exceeding USD35/boe for the rated Asian names, the economic viability of projects will be impaired if there is no meaningful increase in oil prices. At current prices, we expect certain high-cost projects to be delayed. These could include ventures in the Canadian oil sands and certain enhanced oil recovery projects on mature-depleting fields in Asia. Sponsor companies could also delay final investment decisions on some large projects with long lead times, such as some green field LNG projects, to preserve cash reserves.
Capex flexibility also varies across the rated companies. CNOOC and PTT have relatively low developed reserve lives of around four years, which gives them less flexibility to curtail development capex for a long period. The state-owned companies are unlikely to cut domestic capex drastically because they are mandated by states to raise production to supply their growing economies. In addition, PTT has lagged considerably behind its Asian peers in reserve replacement, with several large acquisitions not yet adding to proved reserves. For most of the other rated oil producers, though, reserve replacement has been robust (near 100% or above) in recent years, adding further to their flexibility. We also see the prospect of reserve write-downs for some companies if oil prices do not meaningfully improve by the time reserve reports are updated over the next few months.
Rated Asian oil companies, especially the state-owned ones, have very strong balance sheets, with low financial leverage and substantial cash balances. We expect these companies to have good financial flexibility arising from their good liquidity (large cash balances and strong access to capital). In India, we expect the government to reduce the substantial discounts (USD56/barrel) the two state-controlled upstream companies, Oil India and ONGC, have to provide to refiners, improving their cash margins under low oil prices. Malaysia's PETRONAS has a very strong balance sheet. However, the high dividends required by the Malaysian government remains a challenge, although the company is pushing to lower this burden.
According to Fitch, Fitch is also expect cash-rich companies to take advantage of attractive M&A opportunities, although their approach is likely to be measured to ensure their cash balances remain strong to deal with the uncertain oil price outlook. Asian companies are likely to focus on mid-sized assets that are producing or close to production that put less stress on their balance sheets.
Smaller companies like MIE of China have less financial flexibility. While MIE's lifting costs of around USD10/boe are low, it has relatively weaker access to funding than its larger peers, especially when oil prices are low. However, MIE's cash on hand at end-September 2014 (plus expected proceeds in 4Q14 from some asset disposals) and unutilised credit lines provide adequate short-term liquidity, while its major debt maturities are several years away.
Our approach with oil and gas companies is to rate through the cycle, Fitch says in its latest analysis report. While strong production, weak demand growth and high inventory levels put significant near-term pressure on oil prices, high global marginal production costs and capex cuts leading to reduced production should over time result in a more balanced market that supports higher prices for oil. While low oil prices and high capex requirements will dent the credit metrics of Asian oil producers, ratings of many of these companies, especially the state-owned companies whose ratings benefit from state linkages, remain resilient.
If you believe an article violates your rights or the rights of others, please contact us.
|
|
Friday, 02 December 22
INDONESIAN COAL PRICE REFERENCE PLUNGE TOWARD US$ 281.48 A TON AS DEMAND DROPS WORLDWIDE
COALspot.com: The cost of coal is falling so fast that it is beginning to put real money back in the pockets of end-users.
Indonesia ...
Wednesday, 30 November 22
INDONESIA’S BUMI RESOURCES TARGETS 2023 COAL OUTPUT OF 80 MLN TONNES - REUTERS
Indonesian coal miner PT Bumi Resources Tbk BUMI.JKis eyeing a 10% increase in output to 80 million tonnes next year amid expectations for more fav ...
Wednesday, 30 November 22
TANKERS: LONGER HAULS TO SUPPORT CONTINUED STRENGTH - BIMCO
Highlights
A rebound in the dirty tanker trade has led the Baltic Exchange Dirty Index (BDTI) to increase by 64% since our last report from mid ...
Wednesday, 30 November 22
MARKET INSIGHT - INTERMODAL
Shipping, although a conservative and innovation adverse industry, is currently in a transition period of digital transformation. According to a su ...
Tuesday, 29 November 22
INDIA TO RECEIVE FIRST LNG CARGO FROM INDONESIA’S TANGGUH LNG - REUTERS
India will receive its first cargo from Indonesia’s Tangguh liquefied natural gas (LNG) plant at the Dahej terminal on Monday, according to a ...
|
|
|
Showing 181 to 185 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- Orica Mining Services - Indonesia
- Billiton Holdings Pty Ltd - Australia
- CNBM International Corporation - China
- Miang Besar Coal Terminal - Indonesia
- Simpson Spence & Young - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Bhoruka Overseas - Indonesia
- SMC Global Power, Philippines
- TeaM Sual Corporation - Philippines
- South Luzon Thermal Energy Corporation
- Dalmia Cement Bharat India
- Binh Thuan Hamico - Vietnam
- Orica Australia Pty. Ltd.
- Merrill Lynch Commodities Europe
- Banpu Public Company Limited - Thailand
- Edison Trading Spa - Italy
- Iligan Light & Power Inc, Philippines
- Power Finance Corporation Ltd., India
- Mjunction Services Limited - India
- AsiaOL BioFuels Corp., Philippines
- Energy Development Corp, Philippines
- Barasentosa Lestari - Indonesia
- Kepco SPC Power Corporation, Philippines
- Latin American Coal - Colombia
- Malabar Cements Ltd - India
- Vedanta Resources Plc - India
- Sree Jayajothi Cements Limited - India
- Semirara Mining and Power Corporation, Philippines
- Aditya Birla Group - India
- Krishnapatnam Port Company Ltd. - India
- Tata Chemicals Ltd - India
- Eastern Coal Council - USA
- Salva Resources Pvt Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Electricity Generating Authority of Thailand
- Kideco Jaya Agung - Indonesia
- Manunggal Multi Energi - Indonesia
- Marubeni Corporation - India
- Kaltim Prima Coal - Indonesia
- Price Waterhouse Coopers - Russia
- Bayan Resources Tbk. - Indonesia
- Siam City Cement PLC, Thailand
- Cigading International Bulk Terminal - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Bulk Trading Sa - Switzerland
- White Energy Company Limited
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Karaikal Port Pvt Ltd - India
- San Jose City I Power Corp, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Metalloyd Limited - United Kingdom
- Borneo Indobara - Indonesia
- Ministry of Finance - Indonesia
- Anglo American - United Kingdom
- Bharathi Cement Corporation - India
- Ceylon Electricity Board - Sri Lanka
- PetroVietnam Power Coal Import and Supply Company
- Planning Commission, India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Ind-Barath Power Infra Limited - India
- Minerals Council of Australia
- Maheswari Brothers Coal Limited - India
- Indika Energy - Indonesia
- GVK Power & Infra Limited - India
- Bhushan Steel Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sojitz Corporation - Japan
- ICICI Bank Limited - India
- Africa Commodities Group - South Africa
- Agrawal Coal Company - India
- MS Steel International - UAE
- Economic Council, Georgia
- Medco Energi Mining Internasional
- Kohat Cement Company Ltd. - Pakistan
- Global Coal Blending Company Limited - Australia
- Aboitiz Power Corporation - Philippines
- Altura Mining Limited, Indonesia
- Port Waratah Coal Services - Australia
- Commonwealth Bank - Australia
- Indo Tambangraya Megah - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Larsen & Toubro Limited - India
- London Commodity Brokers - England
- Makarim & Taira - Indonesia
- Formosa Plastics Group - Taiwan
- Carbofer General Trading SA - India
- PowerSource Philippines DevCo
- Tamil Nadu electricity Board
- Vizag Seaport Private Limited - India
- CIMB Investment Bank - Malaysia
- Semirara Mining Corp, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Parry Sugars Refinery, India
- Therma Luzon, Inc, Philippines
- Videocon Industries ltd - India
- The University of Queensland
- Karbindo Abesyapradhi - Indoneisa
- GAC Shipping (India) Pvt Ltd
- Ministry of Transport, Egypt
- Ministry of Mines - Canada
- Sakthi Sugars Limited - India
- Indian Oil Corporation Limited
- New Zealand Coal & Carbon
- Interocean Group of Companies - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Kumho Petrochemical, South Korea
- Coalindo Energy - Indonesia
- Thiess Contractors Indonesia
- Rio Tinto Coal - Australia
- Energy Link Ltd, New Zealand
- Alfred C Toepfer International GmbH - Germany
- Madhucon Powers Ltd - India
- Xindia Steels Limited - India
- Gujarat Electricity Regulatory Commission - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Globalindo Alam Lestari - Indonesia
- Australian Commodity Traders Exchange
- Mercator Lines Limited - India
- Kapuas Tunggal Persada - Indonesia
- India Bulls Power Limited - India
- Bukit Baiduri Energy - Indonesia
- European Bulk Services B.V. - Netherlands
- Riau Bara Harum - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Siam City Cement - Thailand
- GN Power Mariveles Coal Plant, Philippines
- International Coal Ventures Pvt Ltd - India
- Parliament of New Zealand
- Kartika Selabumi Mining - Indonesia
- Jindal Steel & Power Ltd - India
- Deloitte Consulting - India
- ASAPP Information Group - India
- Sinarmas Energy and Mining - Indonesia
- Antam Resourcindo - Indonesia
- Indonesian Coal Mining Association
- Neyveli Lignite Corporation Ltd, - India
- Kobexindo Tractors - Indoneisa
- McConnell Dowell - Australia
- IEA Clean Coal Centre - UK
- Indogreen Group - Indonesia
- Pendopo Energi Batubara - Indonesia
- Trasteel International SA, Italy
- Chamber of Mines of South Africa
- Attock Cement Pakistan Limited
- Ambuja Cements Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Sindya Power Generating Company Private Ltd
- Petrochimia International Co. Ltd.- Taiwan
- Uttam Galva Steels Limited - India
- Lanco Infratech Ltd - India
- Sarangani Energy Corporation, Philippines
- Global Green Power PLC Corporation, Philippines
- Holcim Trading Pte Ltd - Singapore
- OPG Power Generation Pvt Ltd - India
- Meenaskhi Energy Private Limited - India
- Leighton Contractors Pty Ltd - Australia
- Coastal Gujarat Power Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Mercuria Energy - Indonesia
- Sical Logistics Limited - India
- LBH Netherlands Bv - Netherlands
- Coal and Oil Company - UAE
- Singapore Mercantile Exchange
- Intertek Mineral Services - Indonesia
- Samtan Co., Ltd - South Korea
- Timah Investasi Mineral - Indoneisa
- Wilmar Investment Holdings
- Gujarat Sidhee Cement - India
- Renaissance Capital - South Africa
- Posco Energy - South Korea
- Thai Mozambique Logistica
- Kalimantan Lumbung Energi - Indonesia
- Georgia Ports Authority, United States
- Global Business Power Corporation, Philippines
- Meralco Power Generation, Philippines
- Oldendorff Carriers - Singapore
- Bukit Makmur.PT - Indonesia
- The Treasury - Australian Government
- Independent Power Producers Association of India
- Grasim Industreis Ltd - India
- PNOC Exploration Corporation - Philippines
- Goldman Sachs - Singapore
- Mintek Dendrill Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Chettinad Cement Corporation Ltd - India
- Baramulti Group, Indonesia
- Essar Steel Hazira Ltd - India
- Toyota Tsusho Corporation, Japan
- SMG Consultants - Indonesia
- Bangladesh Power Developement Board
- Heidelberg Cement - Germany
- Eastern Energy - Thailand
- SN Aboitiz Power Inc, Philippines
- Directorate Of Revenue Intelligence - India
- Australian Coal Association
- Central Java Power - Indonesia
- Cement Manufacturers Association - India
- Pipit Mutiara Jaya. PT, Indonesia
- Straits Asia Resources Limited - Singapore
- IHS Mccloskey Coal Group - USA
- The State Trading Corporation of India Ltd
- Jaiprakash Power Ventures ltd
- Savvy Resources Ltd - HongKong
- PTC India Limited - India
- VISA Power Limited - India
- Electricity Authority, New Zealand
- GMR Energy Limited - India
- Indian Energy Exchange, India
- Bhatia International Limited - India
- Rashtriya Ispat Nigam Limited - India
- Star Paper Mills Limited - India
- Petron Corporation, Philippines
- Romanian Commodities Exchange
- Wood Mackenzie - Singapore
- Central Electricity Authority - India
- Standard Chartered Bank - UAE
|
| |
| |
|
