Georgia Looks to China For Port and Trade

By Wendy Laursen 2015-09-16 21:03:33

Black Sea nation Georgia has plans for a new port designed to halve transit times between China and Europe.

Georgia’s Prime Minister Irakli Garibashvili outlined the plan in an exclusive interview with China Daily over the weekend.

While in China, Garibashvili met with Chinese Premier Li Keqiang, and the leaders have agreed to commence free trade agreement negotiations. China is Georgia’s third-largest trading partner, with bilateral trade of $820 million last year. Part of the ancient Silk Road, Garibashvili believes the nation can play a role in China’s new Silk Road Economic Belt initiative.

Located at the crossroads of Western Asia and Eastern Europe, Georgia is bounded to the west by the Black Sea, to the north by Russia, to the south by Turkey and Armenia and to the southeast by Azerbaijan.

Garibashvili wants to build a new port in Anaklia on the Black Sea but needs the participation of Chinese companies. Negotiations are underway, and the project is expected to start next year. He said that after the new port is built, it will take just 17 days for Chinese goods to be delivered to Europe, compared with the current shipping route, which takes about a month.

“We have ambition to become a logistics hub in the region,” Garibashvili told China Daily.

At the meeting, Li indicated that China is willing to be involved in infrastructure construction including the port, highways and railway. Li also said he hopes to deepen people-to-people exchanges between the two nations.


Australia Delays Shell BG Takeover Decision

By MarEx 2015-09-16 20:20:47

Australia’s competition watchdog flagged concerns on Thursday that Royal Dutch Shell’s proposed $70 billion takeover of BG Group may lessen gas supply competition in eastern Australia and delayed a final decision on the bid to November.

The Australian Competition and Consumer Commission (ACCC) said a large number of market participants had expressed concerns that the proposed takeover may lead Shell’s Arrow Energy to sell its gas into BG’s Queensland Curtis liquefied natural gas plant (QCLNG) for export.

Queensland Curtis LNG is one of Australia’s largest capital infrastructure projects, involving US$20.4 billion of investment from 2010-14.

“If the proposed acquisition resulted in less supply of gas to the domestic market, therefore, this could substantially lessen competition to supply domestic gas users and lead to higher domestic prices and more restrictive contractual terms,” ACCC Chairman Rod Sims said in a statement.

The commission said it now planned to issue a final decision on November 12.

In response to the regulator’s concern about gas sales by Arrow Energy, which is 50-50 owned by Shell and PetroChina, Shell said BG already had enough gas to meet all its commitments.

“Arrow and QCLNG collaboration could assist the development of Arrow’s undeveloped resources to potentially accelerate additional gas supplies into both the domestic and export market,” Shell said in an emailed statement.

The takeover has already been cleared by U.S. and Brazilian anti-trust authorities. It still needs approvals from Australia’s Foreign Investment Review Board and China to go ahead.

Shell said it remained confident the deal would be completed in early 2016.

Some of Australia’s biggest manufacturers fear Shell’s takeover of BG could worsen what they see as a lack of competition in the country’s eastern gas market, spurred by three new LNG export plants, including BG’s, in Queensland.

“This burst in demand for gas over a very short timeframe for the LNG industry is effectively upending the east coast gas market,” Sims said in a speech at a gas conference on Thursday, outlining the commission’s preliminary impressions on a review of the east coast gas market due in April 2016.

He said the commission had evidence that after the LNG projects were approved, many Australian industrial gas users went from a market where they received three to five offers of supply on negotiable terms, to a market where they received no offers or only one true offer on inflexible terms.