China Huadian Natural Gas Development Strategy

Transcription

1 C H I N A H U A D I A N C O R P R A T I O N China Huadian Natural Gas Development Strategy 中国华电集团公司 September 2016

2 China Huadian Overview Huadian s Development Strategy of Natural Gas Sector Opportunities & Challenges 2

3 CHD Overview--Key Milestones Established Total Installed Capacity amount to 50GW Total capacity amount to 100GW Huadian Green Energy Co.,Ltd established focus on shale gas & LNG First Gas-fired Power Plant in place granted exploration rights to 5 Shale Gas blocks in China Jointly with Sinopec in PNW LNG Project 3

4 China Huadian: Scale Huadian is one of the Big Five state-owned Power Generation Groups in China Big Five by Total Installed Capacity (GW) Guodian, 135 Huadian, Big Five in China s total Generation Huadian, 9% Huaneng, 11% CPI, Huaneng, 160 Other, 55% Datang, 9% CPI, 7% Datang, 127 Guodian, 9% The Big Five state-owned generating companies, namely China Huadian Group, Huaneng Group, Datang Group, Guodian Group and CPI Group, collectively own around 50 percent of Chinese generating capacity.

5 China Huadian in numbers ( ) MW billion USD Ranking billion kwh billion USD

6 China Huadian: Striving to achieve cleaner power generation Total Installed Capacity (MW) China has embarked on its journey to shifting to a lowcarbon electricity country. With that mandate, China Huadian is accelerating the pace of growing of operating assets as well as its optimizing power sources. By the end of 2015, CHD total installed capacity has hit 135 GW, with clean energy accounting for one-third of the total. 100% 80% 60% 40% 20% 0% Installed Capacity by Power Source (%) 25% 30% 34% 37.10% By end of 2015, the percentage of capacity from green energy has exceeded 37.1%, which is the highest among the Big Five power generation groups in China China Huadian also owns the largest installed capacity of natural gas fired plants among the Big Five Other Power Source Green Energy

7 China Huadian Overview Huadian s Development Strategy of for Natural Gas Gas Industry Sector Opportunities & Challenges 7

8 Development Strategy for Natural Gas Business China Huadian Group has developed well rounded and robust strategies for development of its natural gas business: Focusing on and accelerating the upstream development of domestic unconventional gas resources Building natural gas infrastructure to ensure the domestic logistics Securing overseas natural gas supply through LNG projects/contracts Forging an integrated value chain from upstream resources to power generation Focusing on and accelerating the upstream development of domestic unconventional gas resources Securing overseas natural gas supply through LNG projects/contracts Building natural gas infrastructure to ensure the domestic logistics Forging an integrated value chain from upstream resources to power generation

9 Accelerating the Domestic Unconventional Gas Exploration and Development In 2012, Huadian was granted exploration rights to 5 Shale Gas blocks in Hunan, Hubei and Guizhou provinces of China The total resources within these five blocks are estimated to be over 700 billion cubic meters Huadian has since proactively conducted exploration work in these blocks. To date, Huadian has conducted 6900 KM 2 of field geological investigation, around 2000 KM of 2D Seismic and 100 KM 2 of 3D seismic. Huadian drilled and completed 8 exploratory wells The exploration work has brought about great results huge potential resources are evidenced in Hefeng and Xianfeng areas in Hubei Province and the Anye-1 well in Guizhou Province has reached 100,000 cbm/d of production Huadian will continue to focus on the exploration work and reach commercial production in the near future.

10 Securing Upstream Natural Gas through LNG Projects & Contracts In July 2014: Huadian acquired 1/3 equity interest in the Sinopec Huadian Montney Limited Partnership. The Partnership owns 15% of the Montney assets in Northeast BC (operated by Progress Energy), as well as the proposed downstream Pacific Northwest LNG plant. The PNW LNG plant will be comprised of two LNG trains supplying ~6.8 mtpa each, for a total of ~13.6 mtpa, which will be exported from the Canadian west coast to Asia markets for 40 years. China Huadian will be securing 680,000 tons of LNG per year through the PNW project for its domestic natural gas fired power plants. In 2015, Huadian also signed long term contract with BP for up to 1 million tons of LNG per year worth up to $10 billion over the next 20 years

11 Building natural gas infrastructure to ensure the domestic logistics China s LNG Receiving Station as at May 2016 Operating(13) Under construction(6) Planned (11) Potential(10) Huadian Through careful selection, Huadian has started initial work in the provinces of Jiangsu and Guangdong for LNG receiving stations; site selection for LNG transfer stations in Guangdong, Jiangsu, Zhejiang, Shanghai, Hubei and Hunan. Tangshan Dalian LNG Tianjing FLNG Qingdao Rudong Shanghai Ningbo At the same time, Huadian is also starting the feasibility study for the LNG transportation channels in East China, North China and South China Putian Guangxi Dapeng Dongguan JOVO Zhuhai CNOOC Hainan

12 Forging a vertically integrated value chain for natural gas fired power generation China Huadian is proactively looking into other investment opportunities to forge a vertically integrated value chain through upstream natural gas resources to power generation and to the power market

13 China Huadian Overview Huadian s Development Strategy of Natural Gas Sector Opportunities & Challenges 1 3

14 Opportunities:Stay Ahead of the Curve of the Natural Gas Development China s Natural Gas Supply( ) Huadian Natural Gas Demand Unit: 100 million cubic meter Unit: 100 million cubic meter 1,910 31% 6% 63% ,600 36% 19% 46% 2020E 6,000 38% Imported LNG Domestic 23% Unconventional 38% 2030E Domestic Conventional CAGR +9.4% +18.7% +4.4% % E Power plant demand With the fast growing installed capacity, a huge demand for natural gas will be generated from Huadian s own power plants. It is estimated that the total demand will hit 13.3billion cubic meter in by The huge growth potential of the natural gas sector in China as well as Huadian s own surging needs have created great opportunities for Huadian to develop its natural gas business. It must stay ahead of the curve and make strategic deployments

15 Challenges:LNG Industry in the Mist of Uncertainties Global LNG Supply/Demand rebalances post MTPA New Supply with FID Existing Facility LNG Demand Base Case Marker Rebalance 历史情况市场先宽松后再平衡 expected post 2020 Low climate-driven demand High climate-driven demand Uncertainty in commodity price High cost of currently proposed LNG projects Cost overrun and delay Soften spot price since Jun 2014, weak mid-term outlook