1 MONGOLIA MARKS CENTENNIAL WITH A NEW COURSE FOR CHANGE WWW.EASTASIAFORUM.ORG PUBLISHED:2024/12/20      2 E-MART OPENS FIFTH STORE IN ULAANBAATAR, MONGOLIA, TARGETING K-FOOD CRAZE WWW.BIZ.CHOSUN.COM PUBLISHED:2024/12/20      3 JAPAN AND MONGOLIA FORGE HISTORIC DEFENSE PACT UNDER THIRD NEIGHBOR STRATEGY WWW.ARMYRECOGNITION.COM  PUBLISHED:2024/12/20      4 CENTRAL BANK LOWERS ECONOMIC GROWTH FORECAST TO 5.2% WWW.UBPOST.MN PUBLISHED:2024/12/20      5 L. OYUN-ERDENE: EVERY CITIZEN WILL RECEIVE 350,000 MNT IN DIVIDENDS WWW.GOGO.MN PUBLISHED:2024/12/20      6 THE BILL TO ELIMINATE THE QUOTA FOR FOREIGN WORKERS IN MONGOLIA HAS BEEN SUBMITTED WWW.GOGO.MN PUBLISHED:2024/12/20      7 THE SECOND NATIONAL ONCOLOGY CENTER TO BE CONSTRUCTED IN ULAANBAATAR WWW.MONTSAME.MN PUBLISHED:2024/12/20      8 GREEN BOND ISSUED FOR WASTE RECYCLING WWW.MONTSAME.MN PUBLISHED:2024/12/19      9 BAGANUUR 50 MW BATTERY STORAGE POWER STATION SUPPLIES ENERGY TO CENTRAL SYSTEM WWW.MONTSAME.MN PUBLISHED:2024/12/19      10 THE PENSION AMOUNT INCREASED BY SIX PERCENT WWW.GOGO.MN PUBLISHED:2024/12/19      КОКС ХИМИЙН ҮЙЛДВЭРИЙН БҮТЭЭН БАЙГУУЛАЛТЫГ ИРЭХ ОНЫ ХОЁРДУГААР УЛИРАЛД ЭХЛҮҮЛНЭ WWW.MONTSAME.MN НИЙТЭЛСЭН:2024/12/20     "ЭРДЭНЭС ТАВАНТОЛГОЙ” ХК-ИЙН ХУВЬЦАА ЭЗЭМШИГЧ ИРГЭН БҮРД 135 МЯНГАН ТӨГРӨГ ӨНӨӨДӨР ОЛГОНО WWW.MONTSAME.MN НИЙТЭЛСЭН:2024/12/20     ХУРИМТЛАЛЫН САНГИЙН ОРЛОГО 2040 ОНД 38 ИХ НАЯДАД ХҮРЭХ ТӨСӨӨЛӨЛ ГАРСАН WWW.NEWS.MN НИЙТЭЛСЭН:2024/12/20     “ЭРДЭНЭС ОЮУ ТОЛГОЙ” ХХК-ИАС ХЭРЛЭН ТООНО ТӨСЛИЙГ ӨМНӨГОВЬ АЙМАГТ ТАНИЛЦУУЛЛАА WWW.EAGLE.MN НИЙТЭЛСЭН:2024/12/20     Л.ОЮУН-ЭРДЭНЭ: ХУРИМТЛАЛЫН САНГААС НЭГ ИРГЭНД 135 МЯНГАН ТӨГРӨГИЙН ХАДГАЛАМЖ ҮҮСЛЭЭ WWW.EAGLE.MN НИЙТЭЛСЭН:2024/12/20     “ENTRÉE RESOURCES” 2 ЖИЛ ГАРУЙ ҮРГЭЛЖИЛСЭН АРБИТРЫН МАРГААНД ЯЛАЛТ БАЙГУУЛАВ WWW.BLOOMBERGTV.MN НИЙТЭЛСЭН:2024/12/20     “ORANO MINING”-ИЙН ГЭРЭЭ БОЛОН ГАШУУНСУХАЙТ-ГАНЦМОД БООМТЫН ТӨСЛИЙН АСУУДЛААР ЗАСГИЙН ГАЗАР ХУРАЛДАЖ БАЙНА WWW.BLOOMBERGTV.MN НИЙТЭЛСЭН:2024/12/20     АЖИЛЧДЫН САРЫН ГОЛЧ ЦАЛИН III УЛИРЛЫН БАЙДЛААР ₮2 САЯ ОРЧИМ БАЙНА WWW.BLOOMBERGTV.MN НИЙТЭЛСЭН:2024/12/19     PROGRESSIVE EQUITY RESEARCH: 2025 ОН “PETRO MATAD” КОМПАНИД ЭЭЛТЭЙ БАЙХААР БАЙНА WWW.BLOOMBERGTV.MN НИЙТЭЛСЭН:2024/12/19     2026 ОНЫГ ДУУСТАЛ ГАДААД АЖИЛТНЫ ТОО, ХУВЬ ХЭМЖЭЭГ ХЯЗГААРЛАХГҮЙ БАЙХ ХУУЛИЙН ТӨСӨЛ ӨРГӨН МЭДҮҮЛЭВ WWW.EAGLE.MN НИЙТЭЛСЭН:2024/12/19    

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MBCC “Doing Business with Mongolia seminar and Christmas Receptiom” Dec 10. 2024 London UK MBCCI London UK Goodman LLC

NEWS

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Chevron Slams Canadian Backdoor in $9.5 Billion Pollution Fight www.bloomberg.com

Now entering its 24th year, an international legal war seeking to hold Chevron Corp. liable for oil pollution in the Amazon has featured battles in courtrooms ranging from the U.S. to Ecuador to Canada. In a blow to Ecuadorian villagers who contend the company sullied their lands, an Ontario judge last week protected Chevron’s Canadian assets from being seized as part of the fight.

That’s a big victory for the second-largest U.S. fossil fuel company, because in 2011 Chevron lost a court case in Ecuador over the question of liability. As far as the Ecuadorian judiciary is concerned, Chevron owes some $9.5 billion, plus interest, to the villagers. But the energy giant, contending that the enormous judgment was obtained by fraud, has refused to pay. Chevron has no assets in Ecuador, so there’s nothing there for plaintiffs to seize. That’s why the case migrated north to Canada, where a subsidiary has operations the villagers would like to liquidate to cover their verdict.

But in a highly technical 35-page opinion, Judge Glenn Hainey of the Ontario Superior Court of Justice made a sharp distinction between Chevron the parent corporation and Chevron Canada the subsidiary. Chevron Canada wasn’t the defendant in Ecuador and as a legally separate entity, the judge held, can’t be held responsible for its parent’s liabilities.

Chevron hailed the decision. “Once again, the plaintiffs’ attempts to enforce their fraudulent judgment have been rebuked,” R. Hewitt Pate, Chevron’s vice president and general counsel, said via email. “We are confident that any jurisdiction that examines the facts of this case and the misconduct committed by the plaintiffs will find the Ecuadorian judgment illegitimate and unenforceable.”

Karen Hinton, a New York-based spokesperson for the villagers, said in a statement that her clients will appeal Hainey’s ruling, and predicted a swift reversal. “The villagers expect to proceed later this year with their seizure of Chevron’s assets to force the company to respect multiple [Ecuadorian] court judgments that found it” liable for massive contamination, Hinton added.

The very long story that brings us to this moment began in 1993 with a lawsuit filed in New York federal court against Texaco (which Chevron acquired in 2001). Brought on behalf of poor rural Ecuadorians, the complaint was dismissed by U.S. courts and restarted in 2003 in Ecuador. Eight years later, it led to the multibillion-dollar verdict now at issue. Chevron countered that any pollution resulting from Texaco’s activities in the rain forest was the responsibility of the Ecuadorian government to clean up—and, in any event, the verdict was tainted by the misconduct of the villagers lawyers, led by a New York-based attorney named Steven Donziger.

To drive home that last point, Chevron sued Donziger in 2011, obtaining a U.S. judgment that he’d violated anti-racketeering laws by turning the Ecuadorian suit into the equivalent of an extortion scheme. Last year, a federal appeals court upheld the ruling, finding that Donziger and his colleagues engaged in coercion, fraud, and bribery in Ecuador. The decisions have the effect of making it impossible for the villagers to collect on the Ecuadorian verdict in the U.S. That brings us to Canada.

The legal complexities in this branch of the litigation proliferate. In a separate part of his Jan. 20 ruling, Judge Hainey said that if somehow the Ecuadorians succeed in moving forward with their action in Canada—for example, if a higher court reversed his finding that the subsidiary should be shielded—then the oil company would be allowed to fight asset seizures by pointing to the evidence of fraud presented in the U.S. racketeering case.
Meanwhile, on other fronts, the plaintiffs have started legal proceedings to enforce the controversial Ecuadorian judgment in both Argentina and Brazil. Chevron may have won this battle, but the legal war shows no sign of letting up.

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Trump signs memo to leave TPP agreement www3.nhk.or.jp

 
President Donald Trump has signed a presidential memorandum formally withdrawing the United States from the Trans- Pacific Partnership free trade deal. Trump pledged to withdraw from the TPP during the campaign.
The US and 11 other countries, including Japan, had signed the agreement while President Barack Obama was in office. The free trade deal will not take effect without US approval.
Trump called the presidential memorandum "a great thing for the American workers".
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Unlike the Saudis, Russia can't simply shut off oil taps www.rt.com

 
Moscow is committed to the OPEC agreement to cut oil production, but it can’t technically slash its output instantly, according to Russian Energy Minister Aleksandr Novak.
 
“We have our own technological peculiarities. To produce the same volume of oil as Saudi Arabia we have to use a hundred times as many rigs. We have different flow rates, different climatic conditions, and other production technologies,” Novak told RT after the first meeting of a global committee set up to monitor the crude production cut deal on Sunday.
 
According to the global accord, Russia has pledged to cut oil production by 300,000 barrels per day (bpd) starting from January. While Saudi Arabia claims to have cut even more than the pledged 486,000 bpd to 10.058 million bpd this month, Russia has slashed 100,000 bpd.
 
According to Novak, a swift and abrupt cut in production by Russia means investment outflow; it can cause a certain "investment lag".
 
A worker checks the valve of an oil pipe at an oil field owned by Russian state-owned oil producer Bashneft near the village of Nikolo-Berezovka, northwest of Ufa, Bashkortostan, Russia. © Sergei KarpukhinThe craziest oil price predictions for 2017
“Some rigs may be completely shut down. It is very hard, close to impossible, to reactivate these drill holes for us. We implement the agreement considering these technological peculiarities,” said the Russian minister.
 
Novak said it's the first time Russia has taken part in a global deal to deliberately and artificially cut its oil production, which is difficult.
 
"Given that our companies are committed to the agreement, they are very positive about it... The Russian contribution [to the global deal] is real and positive," concluded Novak.
 
Speaking to the Russian media, Novak predicted the oil price would jump from $50 to $60 per barrel this year.
 
“The situation in the market is being rebalanced; stockpiles have begun to fall partially. Most importantly, we see stability and lower volatility," he said.
 
OPEC has pledged to cut oil production by 1.2 million bpd from January 1 in a bid to end oversupply that has more than halved the price of crude since 2014. Other global producers have agreed to cut by 558,000 bpd.
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Blackstone readies new Asia real estate fund of at least $5 billion: sources www.reuters.com

Blackstone Group LP (BX.N) is readying a new Asia-focused real estate fund that aims to raise a record $5 billion or more, betting on strong returns from property investments in the region, people familiar with the plans told Reuters.

The world's biggest alternative asset manager will likely launch the fund in the next 12-16 months, the people said. It has invested more than 70 percent of the $5.08 billion it raised in its first Asia-focused property fund, a threshold when buyout firms typically start considering and preparing for follow-up capital raising.

New York-based Blackstone intends to boost investments in assets such as warehouses and shopping malls in China, India, Southeast Asia and Australia, one of the people said.

Global investors have shown robust appetite for shopping malls, warehouses and other property assets in Asia as they have sought the relative safety and stable returns of real estate, buoyed by growing urbanization and rising incomes in its two most populous countries of China and India.

Underscoring this trend, 22 Asia-focused property funds raised a total of $10.6 billion in 2016, data provider Preqin said. There's already $33 billion of unused capital, or dry powder, in such Asia-focused real estate funds, it said.

Blackstone declined to comment on plans for a new Asia-focused real estate fund.

But when commenting on the fundraising outlook for 2017 in the company's third quarter earnings conference call, Blackstone's Chief Financial Officer Michael Chae said there were "significant" fundraises coming up next year, including a possible new Asia fund.

The people declined to be named because details of the new Asia fund aren't yet public.

Blackstone's first Asia-focused property fund, the $5.08 billion Blackstone Real Estate Partners (BREP) Asia that closed in 2014, is the biggest such fund to focus wholly on Asia, Preqin data shows. The new fund could exceed the first one in size.

The first Blackstone fund invested in Japanese residential real estate, office space in Australia and Chinese shopping malls, posting an internal rate of return of 17 percent through September 2016, according to Blackstone's most recent earnings report.

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In China, the company has a joint venture with developer China Vanke Co Ltd (2202.HK) for logistics investments. Blackstone sold $1.9 billion of commercial property to Vanke last year.

Blackstone is also one of the largest owners of office space in India. Embassy Office Park REIT, which Blackstone co-owns with local developer Embassy Group, is awaiting approval from authorities to launch the country's first ever real estate investment trust (REIT), which Thomson Reuters publication IFR reported could raise $500 million-$1 billion in a 2017 initial public offering.

(Reporting by Sumeet Chatterjee and Elzio Barreto; Editing by Muralikumar Anantharaman)

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Amazon and Google fight crucial battle over voice recognition www.theguardian.com

 
Amazon and Google always thrive in the fourth quarter as people get out their wallets for Christmas. Both companies – or in Google’s case, its parent group, Alphabet – are therefore expected to announce booming revenues in their fourth-quarter results over the next fortnight, with Alphabet going first on Thursday and Amazon the following week. But analysts are already looking beyond the simple question of how many cardboard boxes Amazon filled and how many searches Google answered. They’re wondering which company will win the battle to control your home.
 
That battle is being fought by two carafe-sized cylinders from the respective companies. One is Amazon’s Echo, with its voice-operated “personal assistant”, Alexa; the other is Google Home, which responds to the phrase “OK Google”. Both are internet-connected, home-based devices which can be command to do things: give the weather forecast; play music; read out news headlines; update shopping lists; and control “smart” devices in the home such as light bulbs or power points. In theory, if a device can be linked to it, the Echo can control or monitor it, and keep you informed. And simply by saying “Alexa, add sugar to the shopping list”, users can keep up to date on house supplies and even purchase them directly.
 
Amazon is in the lead, having launched the Echo in November 2014, two years before Google Home came out. Though Amazon has not – and does not – release sales figures for any individual item, investment bank Morgan Stanley estimates that 11m Echos had been sold by the end of November 2016; other estimates suggest a further 7m have been sold since. About 700,000 were estimated to have been sold in the UK and Germany, the only countries outside the US where it is available.
 
The Morgan Stanley estimate would put an Echo in more than 8% of US households. This is a significant figure, especially compared with the best estimates for Google Home, which put its sales at less than a million since its launch in October 2016.
 
Why should Google care about Amazon? Because voice is seen as the next big field for computer interaction, and the home is a far better environment for voice detection than the great outdoors. Research company Gartner reckons that by 2018, 30% of all interactions with devices will be voice-based, because people can speak up to four times faster than they can type, and the technology behind voice interaction is improving all the time.
 
The risk to Google is that at the moment, almost everyone starting a general search at home begins at Google’s home page on a PC or phone. That leads to a results page topped by text adverts – which help generate about 90% of Google’s revenue, and probably more of its profits. But if people begin searching or ordering goods via an Echo, bypassing Google, that ad revenue will fall.
 
And Google has cause to be uncomfortable. The shift from desktop to mobile saw the average number of searches per person fall as people moved to dedicated apps; Google responded by adding more ads to both desktop and search pages, juicing revenues. A shift that cut out the desktop in favour of voice-oriented search, or no search at all, would imperil its lucrative revenue stream.
 
Amazon is copying one feature of Google’s success in smartphones: it is offering methods to connect and control smart devices via the Echo for free, rather as Google’s Android software was offered as a free platform for smartphones. There are signs it is paying off: Wynn hotels in Las Vegas announced in December that it would be adding Echos to all 5,000 rooms, for functions such as playing music and controlling curtains and blinds. That gained some notice, as much as anything because the life cycle of such hotels implies they will be there for a decade or so.
 
Similarly, at January’s Consumer Electronics Show (CES), also in Las Vegas, commentators were struck by how many devices incorporated Alexa. And Amazon is even stealing into Google’s territory: some phones sold in the US from China’s Huawei, which uses Android, will incorporate Alexa rather than Google’s Assistant programme.
 
Google’s natural reaction is to have its own voice-driven home system, in Home. But that poses a difficulty, illustrated by the problems it claims to solve. At the device’s launch, one presenter from the company explained how it could speak the answer to questions such as “how do you get wine stains out of a rug?” Most people would pose that question on a PC or mobile, and the results page would offer a series of paid-for ads. On Home, you just get the answer – without ads.
 
What analysts wonder is: how can Home bridge that revenue gap? So far, Google hasn’t explained. Even if it can fend off the Echo, it may not be able to defend its core business.
 
By contrast, the Echo’s benefit to Amazon is much clearer: it can make online shopping (at Amazon) a breeze, play music from Amazon’s paid-for subscription service, and generally act as a passive block on your using rival shopping sites – rather as Google cemented its dominance by being the default search engine on multiple browsers in the mid-2000s.
 
Richard Windsor of Edison Investment Research suggests that time is running out for Google: “It has to act quickly, as Amazon is on the brink of becoming the industry standard for controlling smart home devices.
 
“At CES, everyone was integrating with Echo, with Google Home and Apple HomeKit barely present.”
 
Indeed, where are Apple and Microsoft, which also have their own voice-driven assistants in the form of Siri and Cortana? Although both can be used in the home – Siri on the iPhone or iPad, and to play content on the Apple TV set-top box, and Cortana on the Xbox games console – neither seems to be intent on the “home assistant” market.
 
Phil Schiller, Apple’s vice-president of marketing, seemed to suggest recently that Apple wouldn’t follow Amazon and Google into offering a voice-only device: “Having my iPhone with me as the thing I speak to is better than something stuck in my kitchen or on a wall somewhere.” He also emphasised the importance of a visual display: “We still like to take pictures and we need to look at them, and a disembodied voice is not going to show me what the picture is.”
 
Even so, there are persistent rumours that Apple has prototyped an Echo-like device in secret but is undecided on whether to release it. The company hasn’t commented. It could be ready to unveil something – or may never do so. Microsoft, meanwhile, is in more homes than the Echo via the Xbox, but isn’t trying to make itself a listening device linked to a shop.
 
So, will we all be burbling away to thin air in a few years, asking how long our commute will take while our smartphones sit unused in the kitchen? Perhaps – though Ken Sena, a senior analyst at investment bank Evercore ISI, suggests that home-based voice assistants will never be used as widely as smartphones. According to Sena, they are not such a must-have.
 
Yet, they were a hot Christmas present – and voice interaction is still in its early days, perhaps comparable to the smartphone market in 2005, when BlackBerry, Palm and Microsoft dominated. Or, it could be like the smartphone market now, effectively dominated by Google and Apple. But which?
 
Alexa, can you see into the future?
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Theresa May’s industrial plan signals shift to more state intervention www.theguardian.com

 
Theresa May will signal an era of greater state intervention in the economy as she launches her industrial strategy with a promise of “sector deals”, a new system of technical education and better infrastructure.
 
The prime minister will publish the strategy at a cabinet meeting in the north-west of England, setting out five sectors that could receive special government support: life sciences, low-carbon-emission vehicles, industrial digitalisation, creative industries and nuclear.
 
She will say the government would be prepared to deregulate, help with trade deals or create new institutions to boost skills or research if any sector can show this would address specific problems.
 
The deals will only be available to sectors that organise themselves and make the case for government action, with May citing the automotive and aerospace industries as sectors that have successfully used this model.
 
Helping specific industries may be easier once Britain has left the EU because it might no longer be bound by state aid rules that restrict ways that governments of member states can support companies. The new industrial strategy is also a marked change from the approach of the previous Conservative-led coalition, which took a more laissez-faire approach to the economy.
 
“The modern industrial strategy … will be underpinned by a new approach to government, not just stepping back but stepping up to a new, active role that backs business and ensures more people in all corners of the country share in the benefits of its success,” May said.
 
On top of the sector deals, an “industrial strategy challenge fund” will help distribute millions of pounds in funding for research and development in areas such as smart energy, robotics and artificial intelligence, and 5G mobile network technology.
 
Another focus of the plan will be on technical education aimed at the half of school-leavers who do not go to university. It will suggest maintenance loans for those wishing to pursue technical education, institutes of technology built in every region and 15 core technical “routes” for students that train them in the skills most needed by employers in their regions
 
The plan will reveal 10 pillars to guide the industrial strategy, including investing in science, developing skills, upgrading infrastructure and making sure growth is shared across the whole country.
 
Carolyn Fairbairn, the director general of the Confederation of British Industry business group, said the industrial strategy was a landmark opportunity. “It must help fix the country’s productivity problems and remove the regional inequalities that have dogged our country for generations, having a positive impact on living standards, wages and the future opportunities of many people,” she said.
 
Others were more critical, with the University and College Union (UCU), which represents more than 110,000 higher education staff, saying it was little more than a “relaunched skills strategy”.
 
Sally Hunt, the UCU general secretary, said: “This is a drop in the ocean that will do nothing to solve the funding crisis in further education, which has seen 1m adult places lost since 2010. If government wants to support technical education, it should invest in our further education colleges, which desperately need thousands more teachers, rather than another set of gimmicks.”
 
The Joseph Rowntree Foundation charity said it should help young people in the longer term but the plan did little for the low-paid who were currently in insecure jobs.
 
“Improving maths and technical education for young people will certainly benefit the economy in the future. But this is a policy for the long term,” said Ashwin Kumar, its chief economist. “Millions of people already in the workforce are struggling with low pay and insecure work … The government’s industrial strategy will only make a real difference to our productivity gap, and to people at risk of being left behind, if it goes beyond manufacturing and high-skilled roles.
 
“It needs to help the millions of people who work in low-paid sectors, live in low-skilled areas and work in low-productivity firms. Action to close the productivity gap and support people who lack basic literacy, numeracy and digital skills would help to achieve this.”
 
May will also announce a £556m boost for the so-called northern powerhouse. Among the projects to benefit are the Goole intermodal terminal to place the town’s existing rail, sea, motorway and waterway links in one site and a £10m life sciences innovation fund for Manchester and Cheshire firms. Blackpool will get a new conference centre and hotel at the Winter Gardens to help re-establish the town as a leading conference destination.
 
May is publishing the plan on the same day as a report from a cross-party group of MPs urging more help for the steel industry, with seven policy demands including cheaper energy and action against Chinese dumping. They said the government was still not doing enough to help the beleaguered industry, despite being heavily criticised under David Cameron for failing to wake up quickly enough to the threat of plant closures.
 
Stephen Kinnock, the Labour MP for Aberavon and a co-author of the report, said: “If we continue along the current path, characterised by a government whose attitude can best be described as a toxic combination of incompetence and indifference, we will see the further decline of the industry and our communities.
 
“However, as this report shows, another path is possible and achievable. With strategic action from government and the industry, we can build a better future for the British steel industry, we can trigger a modern manufacturing renaissance, we can rebalance the British economy, and we can forge a new, more resilient, kind of growth.”
 
In particular, he called for the government to “remove the existing disincentives to investment posed by a punitive business rates regime and crippling energy prices.
 
“The government must firm up procurement policies to support the British steel industry, support skills development, invest in R&D and build a partnership approach to industrial relations and management,” Kinnock said.
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Sainshand Wastewater Treatment Plant construction to commence this year www.mongolia.gogo.mn

 
Construction of the sewage treatment plant in Sainshand, the center of Dornogobi (East Gobi) province, will commence in 2017, an official source told MONTSAME. The project costs USD 3.7 million, funded by the Asian Development Bank.
The wastewater treatment facility will bring solution to sewage problem not only of Sainshand city but also of the small settlement adjacent to the railroad in the north of the city.
The necessary treatment demand for Sainshand is 1,200 cubemeters of wastewater per day, whereas the small settlement near the railroad needs to be treated of 400 cubemeters of wastewater on daily basis.
Intended treatment capacity of the project is 4,200 cubemeters per day. However, the Dornogobi Governor, T.Enkhtuvshin requested to lower the capacity to 3,200 cubemeters to minimize costs in order to allow for building more connections between settlement and treatment facility, to be located in the further southwest side of Sainshand.
The project executors accepted his request and are allowing for a possibility to increase the capacity in the future.
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To russia with energetic love www.chinadailyasisa.com

 
A mega overseas project for liquefied natural gas or LNG that will likely burnish China's global profile, contribute toward the country's energy security, enhance its geopolitical strategy and bolster efforts for economic rejuvenation, is scheduled to start production in the Russian Arctic late this year.
 
The 16.5 million metric tons per annum Yamal project - its corporate entity is called Oao Yamal LNG - is located in north-central Russia (or north western Siberia)
 
In September 2013, China National Petroleum Corp, the country's largest oil and gas producer by annual output, acting through its subsidiary CNPC Russia, bought a 20 percent stake for US$5.4 billion in Oao Novatek's US$27 billion Yamal project.
 
Oao Novatek holds a 50.1 percent stake in the Yamal project, while Total holds 20 percent and Silk Road Fund 9.9 percent. Novatek is Russia's independent natural gas producer and the country's second-biggest LNG company after state-owned Gazprom.
 
China's investment will help the Russian gas supplier to complete the project, one of the largest industrial undertakings in the Russian Arctic. It is reasonable to say a new gas production center is evolving in the Yamal Peninsula, which is expected to transform the Russian gas industry.
 
It is also expected to boost China's oil and gas reserves substantially, ensuring steady long-term supply.
 
Much of Yamal's output would to be supplied to China and other Asian countries, according to Novatek. CNPC had pledged to buy at least 3 million tons of LNG a year, said analysts.
 
According to Wang Lu, an Asia-Pacific oil and gas analyst from Bloomberg Intelligence, imports from Yamal may account for at least 1.6 percent of China's gas demand, which is estimated to be 257 billion cubic meters in 2018, assuming a 10 percent compound annual growth rate during the 13th Five-Year Plan (2016-20).
 
"China's LNG imports will continue to be an important contributor to its supply landscape by 2020," she said.
 
"The project's success and reliability will enhance CNPC's investment return, so this aligns CNPC's interests with Novatek's."
 
For CNPC, Yamal has strategic importance. It expects the project to foster greater cooperation between Beijing and Moscow in the Arctic, give a fillip to economic development and scientific research, and shape regional rules and norms relating to gas reserves in the region.
 
Li Li, energy research director at ICIS China, a consulting company that provides analysis of China's energy market, said the country had arranged for steady import of natural gas from Russia even before the Yamal investment.
 
For instance, Russia's Gazprom has a 30-year contract with China to supply 38 billion cu m of natural gas annually from 2018. CNPC's participation in Yamal is part of Chinese companies' going global strategy and signifies the country's intent to be a key player in the crucial Arctic region.
 
In the process, China will have also helped Russia that has been facing capital shortage due to sanctions imposed by the US and Europe over the annexation of Crimea.
 
The deal represents a significant step in Russian President Vladimir Putin's push to boost commercial ties with China.
 
China's backing will ensure the project will roll, said an official from CNPC Russia. Elaborating, he said sanctions had rendered financing for the project in US dollars impossible.
 
Several US and European banks had pulled out of financing deals. So, China's capital, technology and massive markets are exactly what an Arctic country like Russia needs now.
 
According to Evgeniy Kot, director general of the Yamal project, the company has sold 96 percent of the project's LNG production to European and Asian customers through 20- to 25-year contracts.
 
Benefiting from the vast natural gas reserves situated across the Yamal Peninsula, the company signed loan agreements with the Export-Import Bank of China and the China Development Bank Corp for 1.2 billion yuan (US$173 million) in all.
 
For its part, Russia will provide tax incentives to companies involved in the development of the Arctic region, including zero export duty on LNG and special tariffs for condensate oil.
 
CNPC Russia said it is confident Novatek's rich experience in operating in Arctic weather conditions will help the Yamal project.
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Iron ore prices slide ahead of Chinese New Year celebrations www.businessinsider.com

 
Iron ore spot markets continued to retreat on Friday, undermined by a drop-off in activity and softer sentiment ahead of Chinese New Year celebrations.
According to Metal Bulletin, the spot price for benchmark 62% fines fell by 0.7% to $US80.41 a tonne, leaving it at the lowest level seen since January 11.
The losses for lower grade ores were even larger with the price for 58% fines sliding by 2.53% to $US59.17 a tonne.
Analysts at Metal Bulletin said that the weakness coincided with another decline in rebar futures on the Shanghai Commodities Exchange.
“Futures dropped again today with bearish sentiment dominating the market,” said the group. “Meanwhile, sellers refused to cut prices despite few deals being concluded even at lower prices.”
This stalemate between buyers and sellers was likely exacerbated by many users breaking for New year celebrations, beginning on January 28.
And it looks like thin market conditions continued to impact sentiment on Friday evening with rebar, iron ore and coking coal futures all tumbling for the session.
The May 2017 iron ore future on the Dalian Commodities Exchange slumped 2.31% to 612.5 yuan, well below the multi-year high of 666 yuan struck earlier in the week.
Rebar and coking coal futures also came under pressure, tumbling 2.86% and 3.69% over the same period.
Trade in Chinese commodity futures will resume at Midday AEDT.
Here’s how they finished up on Friday evening.
SHFE Copper ¥46,740 , 0.32%
SHFE Aluminium ¥13,810 , 2.33%
SHFE Zinc ¥22,400 , 0.47%
SHFE Nickel ¥82,200 , -1.43%
SHFE Rebar ¥3,158 , -2.86%
DCE Iron Ore ¥612.50 , -2.31%
DCE Coking Coal ¥1,175.50 , -3.69%
DCE Coke ¥1,600.00 , -3.53%
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New China-Mongolia Mining Deal: Economic Windfall or Environmental Threat? wsj.com

 
Mongolia recently reached a new deal to sell coal to China, helping it boost its faltering economy and start repaying billions of dollars it owes Wall Street lenders.
 
Under the landmark agreement completed late last year, Mongolia’s state-owned mining company will sell coal to China at roughly double the previously agreed-upon rate.
 
The deal follows a devastating four-year period when Mongolian miners exported coal to China at deeply-discounted prices, sometimes for as little as 11% of the global benchmark price, undercutting Mongolia’s economic growth. Mongolia agreed to those punitive terms to get the loan from China and has been struggling to repay it.
 
The new export agreement will help Mongolia pay its mounting debt, including bonds held by BlackRock Inc., Fidelity Investments, UBS Global Asset Management and other global investors that bought the debt for its double-digit yields, according to bond investors.
 
But the export deal has a downside for Mongolia: It effectively transfers much coal production from China, which is bent on cleaning up its environment, to its poorer neighbor.
 
That means worsening environmental damage is nearly certain in Mongolia, as its coal output ramps up, analysts say. Mongolia’s arid climate has been getting drier, in part because mining activities require large amounts of water. Dry conditions have been driving more of the population to the capital, Ulaanbaatar, where people commonly burn coal to stay warm.
 
Trucks carrying coal are backed up for nearly 40 miles at Mongolia’s southern border with China, in what some analysts call the world’s largest traffic jam.
 
"These trucks are on unpaved roads, the air pollution is getting worse, it impacts the communities and the region,” says Damdinnyam Gongor, a Mongolian and independent researcher on natural-resource governance.
 
Yet Mongolia seems willing to make that trade-off, with coal prices soaring since China has begun cutting production, analysts say. Market prices for the type of coal produced in Mongolia, which is used in steel- and iron-making operations, skyrocketed 200% in 2016 to $225 a ton.
 
“The Mongolian government’s most pressing target should be to create sustainable economics for its country,” said Adrienne Lui, an Asia economist for Citigroup. “The smog problem will improve alongside when more people are fed, working and warm.”
 
Mongolia is also in talks with some Asian firms to develop its Tavan Tolgoi coal reserves, analysts say. The Gobi desert site is one of the world’s largest untapped coal mines, with more than six billion tons of coal deposits.
 
Under emperor Kublai Khan, the Mongols conquered China in the 13th century and ruled a powerful empire that eventually collapsed. Today, the country of three million people is the most sparsely populated in the world, according to the United Nations. About 21% of Mongolians are in poverty, and 40% are classified as nomadic, the U.N. says.
 
Even before the new coal price agreement went into effect last quarter, Mongolia was benefiting from a boost in exports to China, after Chinese miners cut back production over the government’s environmental concerns. In November, Mongolia shipped 3.36 million tons of the fossil fuel to its neighbor —a 186% year-over-year increase, according to Chinese customs data.
 
Some analysts are forecasting coal sales to China will boost Mongolia’s economic growth by double-digits. BDSec JSC, Mongolia’s largest broker and investment bank, estimates that Mongolia’s economy could expand by as much as 25% this year if it continues to produce coal at the current rate and if plans for the development of Tavan Tolgoi move forward.
 
Mongolia needs that income to pay back debt. The government is on the hook this year for $800 million in external debt-service obligations, or 7.5% of its gross domestic product, according to Moody’s.
 
The country began borrowing heavily from banks, bond investors and China in 2012 to build infrastructure projects, including an agreement with metal and mining company Rio Tinto to develop copper and gold deposits in the Gobi desert.
 
But a collapse in commodity prices and internal government squabbles delayed mining projects that Mongolia was relying on to pay back those loans. Now the country is seeking new loans from the International Monetary Fund and China.
 
Mongolia’s debt burden upended a once-booming economy, which went from double-digit growth between 2012 and 2014 to about 1.3% this year, according to Standard & Poor’s.
 
Investors have demanded higher yields for taking on the credit risk that comes with the collapse in growth. The country’s most recent bond issue last year sold at an 11% yield, versus similar bonds that were sold in 2012 at 4% yields.
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