Energy Finance

Energy Finance News Review

Invited by Lachmon, President of the Tajikistan Republic, President Xi Jinping will attend the 14th Conference of the Board of the presidents of the member countries of Shanghai Cooperation Organization to be held in Dushanbe, Tajikistan from September 11th to September 12th.   During the visit, Xi Jinping will, together with Tajikistan President Lachmon, attend the construction commencement ceremony for the Line D of the China-Central Asia Natural Gas Pipeline which shall play an important role in guaranteeing Chinese energy security.  On September 11, President Xi Jinping met with Russian President Putin in Dushanbe. Xi Jinping stressed that both sides need to start with the Sino-Russian West Line Natural Gas Pipeline as soon as possible. And Putin expressed his high attention to the matter and expressed that the West Line Natural Gas Pipeline should be accelerated.

Fu Yucheng, Chairman of SinoPec disclosed during the Davos Forum held in Tianjin on September 10 that the mixed-ownership reform for the sales business of the company would be completed ahead of the end of the year, as shareholders all wanted to get the future sales business listed in stock market. Prior to that, the company claimed that two rounds of competitive bidding were finished already. And as to the bidding results, Fu Yucheng hinted that news would be available in a few days. However, according to the well-informed, the list for specific strategic investors would be available at the end of September.

Van Rompuy, Chairman of the Council for European Union pointed out in the statement announced on September 11 that the latest round of sanctions imposed by European Union against Russia would become effective on next day.  As disclosed by the media, the new sanctions includes the financial sanctions against the large type of Russian state-owned enterprises, such as forbidding Russian Oil Company, Russian Oil Company Pipeline Transmission Company and Russian Natural Gas Industrial Petroleum Corporation raising fund in  European market.  In the meantime, US President Obama announced Thursday that U.S would join the European Union imposing stricter sanctions against Russia in fields of finance, energy and defense as a response to sending troops to the eastern part of Ukraine by Russia. President Obama says in his statement delivered on Thursday that ' the measures would further isolate Russia in political world and will exact more economical costs, especially to those who are close to Putin and in multiple important fields.

Energy Finance Data Analysis
China5e • Energy Index is a vane of China energy industry development condition, it includes Energy Composite Index, Oil & Gas Index, Power Index, Coal Index and New Energy Index.

  Energy Index of A Week

  Shanghai and Shenzhen Composite Index of A Week

Coal & Power

Coal & Power News Review

The spot price for September as announced by Shenhua is 5 Yuan/ton more on top of that in August, in which, the spot price for 5500 kcal coal is raised to 494 Yuan/ton from 489 Yuan/ton, and the minimum price with favorable conditions is 484 Yuan/ton.

The specific price policy for September are as follows: beginning from September 1st, the market tag price for 5800 Kcal is 534 Yuan/ton;  the market tag price for 5500 Kcal is 494 Yuan/ton; the market tagged price for 5000 Kcal is 434 Yuan/ton;  the market tag price for 4500 Kcal is 384 Yuan/ton, and with favorable conditions are same as those for August, remain unchanged, which means the maximum favor for the customers whose purchase is above 5 million tons is 10 Yuan/ton. The fulfill rate shall be the same as that in September, i.e. 90% or 90% on cumulative basis from January to September.

As disclosed by relevant people, since market demands has not turned positive, the sales for Shenhua in August is not optimistic, and due to the sales issues, the price for part of the coal at Zhuhai port is reduced by 10-15 Yuan/ton on August 29th. The price rising this time by Shenhua is not only responding to the government`s call on holding price but also reflect its positive position about the domestic market in September. 

As disclosed by a person from China Coal Group, the coal policy of China Coal for September would be announced and the price for all kinds of coal would be raised b 5 Yuan/ton, and the favorable conditions for sulfur content and large quantity would continue.

Specifically, from the 24:00 hour of September 4th, the spot price at northern ports is:  Ping I (5800 kcal) coal price be 540 Yuan/ton, increased by 5 Yuan/ton;  Ping II (5500 kcal) coal price be raised to 494 Yuan/ton, increased by 5 Yuan/ton;  Ping III (5000 kcal) coal price be raised to 434 Yuan/ton, increased by 5 Yuan/ton;

For long-term agreement customers, the price shall be spot price lessened by 5 Yuan/ton and, in the meantime, the favorable policy on sulfur content and large quantity purchase shall continue until September 30th.

Coal & Power Data Analysis

  Bohai Thermal Coal Price Index (BSPI) (Unit: yuan / ton).
Published：Sept 10, 2014

Oil & Gas

Oil & Gas News Review

According to the person-in-charge of the Ministry of Foreign Affairs, among the non-political topics for President Xi Jinping during his visit in Tajikistan and the three countries in southern Asia from September 11 to September 19, there are key projects in economical and trading and infrastructural construction on oil and gas pipelines and humanitarian cooperation like tourism. And, President Xi shall, together with the president of Tajikistan, attend the construction commencement ceremony for the section of the China-Central Asia natural gas pipeline inside the Tajikistan.

Russia and Iran are getting closer along with the various economical sanctions imposed by the west, and Russian businesses are preparing to enter into Iranian market in large scale, while Iran hopes to export oil to Russia to swap for foods and plans to strengthen the cooperation with Russia and China in fields of energy and economical and trading to withstand the sanctions from the west.

Russian Natural Gas Industry Corporation expressed on the 11th that the negotiation on supplying gas to China through West Line would be started in a few weeks and is expected to be closed in short time. It is estimated the basic gas supply volume would be 30 billion cubic meters which can be enlarged after discussing with Chinese.
On September 12, the Ministry of State Land and Resources, the National Development and Reform Commission, the Ministry of Science and Technology and the Ministry of Finance met together on the progress achieved in Phase I of the Mine Searching Breakthrough Strategic Action. Data shows that, the proven geological reserves of petroleum and natural gas in China is growing at a high level, and the newly added petroleum is 3.947 billion tons, while the newly added natural gas is 2.3 trillion cubic meters.

According to Bloomberg, Shell, the first foreign company that signed shale gas output sharing contract in China, shall cut its project scale in Sichuan, having been impacted by the issues concerning geological structure and the dense local population. As it going deeper in assessing shale gas development, this is not the first time that Shell is releasing news about cutting shale gas project scale.

The report issued by the World Resources Institute (WRI) shows that, 38% of the shale gas resources in the world is distributed in draught region or in the region where benchmark hydraulic pressure is extremely high and, when hydraulic fracturing is applied in developing shale gas resources, the governments and businesses in all country may face intense competition for water resources.

Oil & Gas Data Analysis

  World Crude Oil Price Table

   Major energy commodity price(9.8-9.12) (Unit: Yuan)

New Energy

New Energy News Review

According to market research company IHS, the global solar energy photovoltaic project inventory has reached 132 GW, and 26 GW out of it are in China and, it is said on 3.7 GW is being constructed at the moment. China installed about 3 GW photovoltaic capacity in the first six months in 2014, which proves that there`s only 3.7 GW being constructed by the end of August, and that at least 6GW needs to be installed before the end of the year to satisfy the target which is 13 GW set by China.

According to the statistical results announced in August by Solarbuzz, the solar energy battery department of the NPD Group, the American investigation company, in the second quarter of 2014, the shipment of solar energy battery from the large type of solar energy battery manufacturers in China has been raised up to 6.6GW from the 5.2GW which was the figure of previous quarter (first quarter of 2014), rose for 26%.

As disclosed by Zhao Jiasheng, deputy director of China Non-Ferrous Metal Industry Association, in the first half of this year, Chinese multi-crystalline silicon industry achieved a sales of 9.58 billion Yuan, rose for 144.8% compared with that of the same time period of last year, realized profit about 600 million Yuan, with about 6.5 billion Yuan newly added investments. The multi-crystalline silicon output in China in the first half of this year was 62 thousand tons, rose for 100% compared with that of the same time period of last year, taking up about 41% in the global output.

It is learned from the Development and Reform Committee of Huangshi City that, the supporting policy for the photovoltaic power generating industry in Huangshi City has been decided. And, for the tariff for distributed photovoltaic power, 0.1 Yuan/KWh subsidy shall be added on top of the 0.42 Yuan/KWh subsidy from state government, and the subsidizing time shall be 10 years.

To reduce “Wind Abandon”, 53 wind farms in Heilongjiang shall be sending power to Northern China. Data shows that, as of the end of July, the Heilongjiang Power Company under the State Grid has procured on cumulative basis 788 million KWh of power that was supposed to be sent to Northern China and has paid 252 million Yuan electricity payment as well as the payable 173 million Yuan renewable energy subsidy which includes the tariff subsidy and interconnection subsidy provided by state government

National Energy Administration convened a meeting in Beijing most recently initiating the study on the wind power planning and off-taking capacity during the 'Thirteenth Five-Year Plan”.  The meeting defined the topic research content and working mechanism, which has laid down a good foundation for carrying out the wind power off-taking and consumption smoothly during the “Thirteenth Five-Year Plan”.

New Energy Data Analysis

  International Solar Price (Unit: USD)