• 6 minutes Trump vs. MbS
  • 11 minutes Can the World Survive without Saudi Oil?
  • 15 minutes WTI @ $75.75, headed for $64 - 67
  • 2 hours Satellite Moons to Replace Streetlamps?!
  • 2 days US top CEO's are spending their own money on the midterm elections
  • 1 hour U.S. Shale Oil Debt: Deep the Denial
  • 19 hours EU to Splash Billions on Battery Factories
  • 43 mins The Dirt on Clean Electric Cars
  • 2 hours Owning stocks long-term low risk?
  • 2 hours Can “Renewables” Dent the World’s need for Electricity?
  • 2 days Uber IPO Proposals Value Company at $120 Billion
  • 1 day The Balkans Are Coming Apart at the Seams Again
  • 2 days A $2 Trillion Saudi Aramco IPO Keeps Getting Less Realistic
  • 1 day 47 Oil & Gas Projects Expected to Start in SE Asia between 2018 & 2025
  • 2 days OPEC Is Struggling To Deliver On Increased Output Pledge
  • 13 hours The end of "King Coal" in the Wales
Dave Forest

Dave Forest

Dave is Managing Geologist of the Pierce Points Daily E-Letter.

More Info

Trending Discussions

Does This Emergency Move Mean Trouble In China's Mining Sector

Very interesting reports emerging from China’s mining sector late last week. Suggesting that the sector is struggling with some major issues, and needs serious help in moving forward.

The biggest problem is debt. With sources suggesting that the country is about to take unprecedented action in dealing with money owed by some of the biggest national mining firms.

Bloomberg quoted people familiar with the matter as saying this will take the form of a state-owned fund to absorb bad mining debt. Including debts owed by some of the highest-profile Chinese companies working overseas. Related: Oil Industry Cutting Again, But It Still Might Not Be Enough

Sources said the new fund will be established by the State-Owned Assets Supervision and Administration Commission. And will aim to take on existing debt from across the mining industry.

Familiar persons singled out China’s largest metals trader, Minmetals, as one of the companies likely to see debt taken off its books. With the mega-firm currently owing about $9.3 billion to debt holders.

That’s a point that should be of interest for the mining investment community around the world. Given that Minmetals’ 74%-owned subsidiary MMG is an important player in international projects in Australia, Canada, Peru and Laos. Related: How Far Will Oil Sink Before Christmas?

All the more so because China’s creation of the debt fund suggests the government here sees miners being stretched right now in terms of finances. (Not surprising, given the recent fall in metals prices — and the aggressive investments in new projects made by Chinese companies the last several years.) 


The hope is the fund will head off serious problems with these firms, ensuring that operations can continue without major interruption. Related: Tesla’s License Plate Mystery Debunked

If the plan goes smooth, we may not see much fallout on the local or international stage. But this development does suggest investors should be keeping an eye on China-related ventures for any signs of financial strain.

It also makes it likely that many Chinese companies will be more careful in new investments going forward. Potentially meaning less capital coming out of this part of the world for minerals development.

Here’s to going off the books

By Dave Forest

More Top Reads From Oilprice.com:


x


Back to homepage

Trending Discussions


Leave a comment

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News