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Strategies & Market Trends : China Warehouse- More Than Crockery -- Ignore unavailable to you. Want to Upgrade?

To: RealMuLan who wrote (2921)	3/19/2004 11:10:43 AM
From: RealMuLan	Read Replies (1) \| Respond to of 6370

Yukos Plans to Double Rail Exports to China Reuters Yukos plans to more than double rail deliveries of crude to China to at least 300,000 barrels per day by 2006, amid continued uncertainty over Moscow's final decision on a pipeline to Asia, the oil major said Wednesday. "We have recently signed short-term deals with Chinese Sinopec and CNPC and are currently working on a longer-term agreement for 2006-2012, which will boost our total rail shipments to 15 million tons," a company official said. He said short-term deals would allow Yukos to ship 6.5 million tons to China this year, up from 3.0 million tons last year. Supplies will further increase to 9.0 million tons (180,000 bpd) in 2005. Of these volumes, CNPC, China's biggest oil firm and parent of PetroChina, will get 3.8 million tons this year by rail from Zabaikalsk on the Russia-Chinese border and 5.5 million tons in 2005. When the long-term deal is signed volumes will rise to 10 million tons from 2006. Asia's largest refiner Sinopec will receive 2.7 million tons this year by rail via Mongolia, rising to 3.5 million tons next year and to 5 million tons from 2006. China, the world's second-largest and fastest-growing major oil consumer, is counting on supplies from Russia, the world's second-largest oil exporter, to cut its dependence on the Middle East. Yukos is leading the project to build a $2.5 billion pipeline to China and CNPC agreed last year to buy a total of 700 million tons of oil between 2005 and 2030, a deal valued at $150 billion. But the project is on hold after President Vladimir Putin said last year he preferred an alternative route to Japan. The Chinese project was further clouded by prosecutors' attack on YUKOS and its key owner, Mikhail Khodorkovsky, who is has been jailed on charges of fraud and tax evasion. Analysts believe the attack was orchestrated by the Kremlin to punish the billionaire for political activities. The Railways Ministry said in January it would be technically ready to ship up to 240,000 bpd of Yukos' crude to China by 2006. Analysts said Yukos has been following a sensible strategy of exporting additional oil by using more expensive options while oil prices remain high. "However, the company is running the risk of selling crude to China at a loss if international oil prices fall sharply before the contract expires in 2012," UFG brokerage said. themoscowtimes.com