RE:RE:RE:RE:RE:Zacks says sell Cenovus... doesn't matter, the gas deal was agreed on before husky spent hundreds of million risk capital into exploration and development of liwan, and this was way before LNG became a competitive supply. Like i said many times before, cheap NG is not the only thing china want, they want to learn and steal offshore drilling/operation technology from a western operator, so china can then use that technology to steal oil/gas prospects in south china sea for themselves. Go ask vietnam and philippines how they fell having china drilling platform in their coastal water, That is why husky is the only parnter cnooc can attract because history lesson told exxon, mobil, petrocanada, phillips, BP not to put new money into china because china gonna screw them. Husky enter the liwan deal mainly because the favorable gas contract. Who knew china willing to screw another china man like LKS who already have billions invested in china??? Husky threw in a small bone and accepted a small price cut to save ligitation cost, to give china a chance to save face, and HSE shareholders don't want this drag on for years. China is all about cheating and saving face. To china, cheating is part of doing business.
China was already reneging its liwan gas contract in 2015, barely 1 year into the contract. If was in 2016 that husky threaten to sue. You should stop buying into ragingrabies probable cause of event that no one sign long term contract. Husky wouldn't have drilled if there was no long term contract. The contract is water tight. IE no loophole, maybe or but. Only way to break it is illegally.
autofocus111 wrote: mrbb The gas market was being flooded with LNG which created huge uncertainties about the future competitiveness of the project and led to the dispute. In the end HSE and CNNOC did come to an agreement that resulted in a realatively small ~13% haircut in the contract pricing but also the two stakeholders agreed to continue to expand the project. It was a tough call but HSE did threaten legal action, and ultimately they got a very reasonable outcome considering the situation at the time.
>>>CALGARY, Alberta (Bloomberg) -- The end of a dispute over prices from an offshore Chinese energy project resolves an overhang on shares of Husky Energy Inc. and prospects for natural gas development in the Asian nation. Husky, the Canadian producer controlled by Hong Kong billionaire Li Ka-Shing, on Tuesday announced an agreement that will lower prices paid for gas output from the deepwater Liwan project. That settles a discord with China’s state-owned Cnooc Ltd. that took investors by surprise in April, when Husky said Cnooc was seeking to pay lower prices than stipulated by an existing contract. Husky also said Tuesday that the companies will develop Liuhua 29-1, a field at Liwan, adding to the project’s growth. The expansion of Liwan and the price reduction of about 13% from the prior contract, less than the 30 to 50% cut investors had assumed, are both positive for Husky, according to FirstEnergy Capital Corp. analyst Michael Dunn. Foreign operators in China also broadly benefit from the deal, which sends a strong statement about the country’s commitment to growing indigenous gas supplies, analyst Ben Wilson of RBC Dominion Securities Inc. said in a note.“It’s a lot better than people feared,” Dunn said in a phone interview. Husky’s stock should outperform peers on Wednesday on clarity over pricing and Liuhua 29-1’s advancement, which was uncertain with Asia awash in cheap LNG cargoes that compete with domestic supplies, he said. “That project’s fate prior to these negotiations was anything but clear because the need for that gas in mainland China is not clear, either.”
https://www.worldoil.com/news/2016/8/3/husky-cnooc-resolve-liwan-gas-dispute-by-lowering-prices