China National Offshore Oil Corp., one of China’s main LNG importers, has issued an advisory statement expressing “regret” at a decision by New York Stock Exchange to delist its shares under measures first enacted by the Trump Administration. CNOOC said its NYSE shares, which are American Depositary Shares (ADSs), could be exchanged for ordinary Hong Kong-listed shares.
Formal prohibitions on CNOOC took effect on March 9, 60 days after the company was added to the list that prohibits US investments, according to a guidance issued by the US Treasury Department on January 27. Advising ADS shareholders of ADS on how to react, CNOOC said each ADS can be cancelled for delivery of 100 ordinary shares of the company, which are listed for trading on the Hong Kong Stock Exchange.
Right to appeal
The NYSE said CNOOC had the right to appeal the delisting decision. The US exchange said it would include any appeal it receives in its application to the US Securities and Exchange Commission, which will be submitted on completion of all procedures.
“The company regrets the NYSE’s decision and actions,” said CNOOC. “The NYSE’s decision and actions may affect the trading prices and volumes of the company’s securities,” added the Chinese major. “The company will continue to closely monitor the development of this matter and make further announcements as appropriate,” it stated.
LNG imports to rise in 2021
As one of China’s largest LNG importers, CNOOC has capacity at nine of the country’s 22 LNG import terminals and ports. The Trump Administration had in 2020 moved against certain Chinese companies that Washington that it claimed to be “owned or controlled by the Chinese military” in an effort to ramp up trade pressure on Beijing.
CNOOC’s LNG import capacity is held at most of the regasification terminals south of Shanghai, the port city where it has capacity at one facility. It is additionally a foundation customer at the Royal Dutch Shell-operated Queensland Curtis export plant on Curtis Island in eastern Australia.
Analysts expect China's natural gas imports including pipeline gas and LNG are forecast to rise by 18 percent to 163 billion cubic metres in 2021, given that Chinese state-owned gas companies two more regas and import terminals in 2021, Pinghu LNG and Wenzhou LNG, both located in the eastern Zhejiang province.