Year: 2021

Second phase of CPEC: Chinese companies showing some reluctance

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Chinese companies are reportedly reluctant to engage in the second phase of the China-Pakistan Economic Corridor (CPEC) due to failure to meet the terms and conditions agreed with existing companies especially in power sector and has bandied charges of enticement. Background interviews with officials dealing with Chinese companies, discussions at a recent high level Joint Working Group of Pakistani and Chinese officials meeting as well as available documents paint a depressing picture. According to sources, the representatives of Chinese companies which have established power projects in Pakistan under CPEC maintain…

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The Real Reason OPEC+ Refused To Boost Production Further

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A year ago, the oil industry was struggling to stay afloat, with OPEC producers being told they were becoming increasingly irrelevant in a world set on a renewable energy path. Fast forward to today, and analysts are talking about crude oil reaching $100 before the year ends. Now, even if OPEC and its allies wanted to help those who find the current prices too steep, they may not be able to. Earlier this year, the cartel and its allies, led by Russia, decided to return 400,000 bpd to global supply…

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Losses Of DISCOs Witness Increase During 2020-21

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The losses of four power distribution companies (DISCOs) including Hyderabad, Peshawar, Sukkur and Quetta Electric Supplies Companies have increased during 2020-21. According to State of Industry Report published by power regulator NEPRA, HESCO, PESCO, SEPCO and QESCO reported highest losses with 38.55%, 38.18%, 35.27% and 27.9% losses respectively. While the losses of Tribal Electric Supply Company (TESCO), Gujranwala Electric Supply Company (GEPCO), Faisalabad Electric Supply Company (FESCO), Multan Electric Power Company (MEPCO), Lahore Electric Supply Company (LESCO) and Islamabad Electric Supply Company (IESCO) remained 9.58%, 9.23%, 9.28%, 14.93%, 11.96% and…

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Cement’s coal play

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FY21 was a treat for the cement industry. Booming demand (dispatches grew by 10 million tons in just one year; up 21%), substantially improved retention (average revenue per ton sold grew between 20 and 30% for most cement players situated in the north zone and 4-15% for those in the south zone), fixed costs absorption, tamed overheads and shrunk finance costs turned an industry that was in losses last year cumulatively become profitable with profit margins going into double-digits. But all this was despite the looming cloud of rising coal…

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LNG sellers seek credit letters as gas price spike stretches credit limits

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Sellers of liquefied natural gas (LNG) are asking for credit letters from companies they deal with to guarantee they can pay as the global spike in gas prices takes them beyond their credit limits, industry sources said. Defaults have been rare in LNG, which has typically relied on big players with deep pockets, but over the last two-to-three years, around 20-to-30 companies have entered the market, at least doubling the number of relatively small players. These companies were lured by a spike in demand, especially in Asia, spurred by relatively…

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