Media Focus on Multinational Corporations[2022.06.20]






PetroChina and Gazprom signed the technical agreement on Sino Russian Far East gas supply project

According to PetroChina, on June 16, huangyongzhang, deputy general manager of CNPC, held a video conference with markolov, vice president of Gazprom. During the meeting, the two sides jointly signed the technical agreement on Sino Russian Far East gas supply project.


The gas transmission capacity of 'Beixi' natural gas pipeline was only maintained at 40% for four consecutive days

According to the Tass news agency, the natural gas volume transported to Germany through the 'Beixi' natural gas pipeline has been maintained at 40% of the total transportation capacity for four consecutive days. The local government is following up the situation and contacting the relevant energy companies.

Zipair Tokyo

Japanese airline Zipair ditches 'Z' logo to avoid pro-Russia misunderstanding

TOKYO——Low-cost carrier Zipair Tokyo Inc says it will ditch its logo featuring the letter Z, a pro-war symbol often seen on Russian military vehicles, to avoid misunderstanding.

The president of the wholly owned subsidiary of Japan Airlines Co told a press conference at Narita airport on Wednesday that some people might see the current logo as indicating the company approves of Russia's invasion of Ukraine.

'I think some people might feel that way when they see it without any explanation,' Shingo Nishida said.

The new logo will be a geometric pattern in green, black and white, the company said.

The budget airline currently operates flights connecting Narita with Bangkok, Seoul, Honolulu, Singapore and Los Angeles.

Zipair, which began operations in 2020 as an LCC specializing in international flights, plans to launch its sixth route to San Jose, California, in December.

The new logo will be put into use on Saturday. The letter Z has been painted on the vertical tail of its B-787s.


Boeing delivers 35 planes in May as it grapples with supply chain problems

Boeing said Tuesday it delivered 35 planes in May, on par with the previous month as it grappled with supply chain issues affecting its bestselling 737 Max jetliner.

The manufacturer booked gross orders for 23 aircraft last month, the majority of them wide-body planes, whose sales have lagged narrow-body aircraft orders. Those included seven 787-9 Dreamliners for Lufthansa. In April, Boeing booked gross orders for 46 planes.

“We have got to work our way through these supply constraints,” Boeing CEO Dave Calhoun said at a Bernstein investor conference earlier this month. He said the company does plan for production rate increases but will “only pull the trigger when the supply chain is ready.”

While Boeing has faced supply chain issues for production of its Max jets, deliveries of its 787 Dreamliners remain paused as the company and the Federal Aviation Administration review production flaws before handing the planes over to customers.


Major Apple supplier Foxconn breaks ground on first EV battery plant

June 15, 2022  Foxconn, a key iPhone supplier, broke ground on its first battery cell facility in southern Taiwan, Nikkei Asia reported on Wednesday.

“We plan to build a localized ecosystem for the battery supply chain, from materials to battery cells and battery packs, in Kaohsiung,” Foxconn Chairman Young Liu said at the groundbreaking ceremony. “The city will become an important base for Foxconn’s EV global footprint.

Trial production of lithium iron phosphate batteries in the city is set to commence in the first quarter of 2024, with a capacity of 1.27 gigawatt hours. The batteries will be first used in electric buses, electric passenger vehicles and energy storage systems.

Foxconn’s battery-related investments in the city, according to Liu, will total up to $202 million, and will comprise facilities for electric bus assembly, energy storage systems, and a research and development center.

Once the ecosystem in Kaohsiung is up and running, Indonesia will likely become the location of Foxconn’s first overseas battery plant, Liu said.

The iPhone assembler has been stepping up efforts to expand its presence in the booming EV industry in recent years. In October 2021, Foxconn introduced two passenger EV models and an electric bus prototype at its annual Foxconn Technology Day event.

The company is also increasing its investments in automotive semiconductors by purchasing a chip facility in Hsinchu, a city in northern Taiwan, and planning to set up chip facilities in India and Malaysia.

Last year, the company has set targets for its EV business, aiming that its designs, components, and parts would account for 5% of global EV markets by 2025 and generate NT$1 trillion in EV-related revenue by 2026.


Minor gas find for ConocoPhillips off Norway

ConocoPhillips Skandinavia, a Norwegian subsidiary of the U.S. energy giant, ConocoPhillips, has made a minor gas discovery in a well located southwest of the Skarv field in the Norwegian Sea.

ConocoPhillips received a drilling permit for the well 6507/4-3 S from the Norwegian authorities in April 2022. This well was drilled about 30 kilometres southwest of the Skarv field in the Norwegian Sea and about 240 kilometres west of Brnnysund.

In an update on Thursday, the Norwegian Petroleum Directorate (NPD) informed that ConocoPhillips as the operator of production licence 1064, valid until 14 February 2026, has concluded the drilling of the wildcat well 6507/4-3 S. This is the first exploration well in this production licence, which was awarded in APA 2019.

ConocoPhillips Skandinavia has an ownership interest of 40 per cent interest in this licence while other licensees are PGNiG Upstream Norway with 30 per cent, Aker BP with 20 per cent, and the Norwegian state-owned giant Equinor, which holds the remaining 10 per cent interest.

The NPD explained that the objective of the well 6507/4-3 S was to prove petroleum in reservoir rocks from the Late Cretaceous in the Lange Formation. During the drilling of the well, sandstone layers were encountered in the Lange Formation totalling about 55 metres with poor reservoir quality.

According to the NPD, the well encountered an approximately 1-metre gas column in the shallowest part of the sandstone layers, but no contacts could be proven.

The NPD pointed out that the preliminary estimates indicate the size of the discovery is less than 0.1 million Sm3 of recoverable oil equivalent. In light of this, the result from this well will be considered by the licensees for further prospectivity in the licence.

While the well was not formation-tested, extensive data acquisition and sampling were carried out, based on the NPDs statement. In addition, the Norwegian Petroleum Directorate confirmed that the well was drilled to a vertical depth of 3914 metres below sea level, and was terminated in the Lange Formation from the Late Cretaceous.

Furthermore, the water depth at the site is 436 metres and the well will now be permanently plugged and abandoned. This well was drilled by Transoceans Transocean Norge semi-submersible rig, which was originally contracted in June 2021 for four wells with five one-well options.

As disclosed by the NPD, the Transocean Norge rig will now drill wildcat well 6306/3-2 S in production licence 935 in the Norwegian Sea, where ConocoPhillips Skandinavia is also the operator.

Chevron Corp

Chevron completes acquisition of Renewable Energy Group

Chevron Corp. has completed its previously-announced acquisition of Renewable Energy Group, Inc. (REG), following approval by REG stockholders.

We have brought together companies with complementary capabilities, assets, and customer relationships to make Chevron one of the leading renewable fuels companies in the United States,said Mark Nelson, Executive Vice President of Downstream & Chemicals for Chevron. Chevron now offers our customers an expanded suite of cost-effective, lower carbon solutions that utilise todays fleets and infrastructure.

Further, Cynthia 'CJ' Warner, formerly President and CEO of REG, has been appointed to Chevrons Board of Directors.

CJ Warner has deep experience across both the traditional and renewable energy sectors,said Chevron Chairman and CEO, Mike Wirth. Her perspective and guidance will be invaluable as Chevron leverages its strengths to deliver lower carbon energy to a growing world.


Shell to invest $66m to build LNG import terminal in the Philippines

Shell Energy Philippines is reportedly planning to invest PHP3.5bn ($66m) to build a liquefied natural gas (LNG) import terminal in Batangas City, the Philippines.

The project is planned to be developed within Pilipinas Shell Petroleums (PSPC) Shell Tabangao import terminal, reported The Philippine Star.

The project involves reviving the planned LNG import terminal, which was first proposed in 2013 through Tabangao Realty (TRI), Shell Energy said in a filing with the Department of Environment and Natural Resources-Environmental Management Bureau (DENR-EMB).

The original project was put on hold due to issues such as market conditions, and development costs, among others.

Shell was cited by the news agency as saying: With the announcement of PSPC of the refinery closure and its conversion to an import facility, [Shell Energy] saw the opportunity to revive the LNG project in line with Shells pursuit of clean energy projects and utilise existing utilities of PSPC such as the Jetty 4.

The revised project will include a 3.8 million tons per annum (Mtpa) floating storage and regassification unit (FSRU), and the conversion of the existing import facility Jetty 4 from a crude import jetty, to a berthing facility for the FSRU.

It will also include a pressure reduction metering station (PRMS), subsea and onshore gas pipelines, pigging stations, and an ignitable vent.

The company was cited by Manila Standard as saying in the documents: The project will supply natural gas for power use with the impending depletion of the Malampaya gas field by 2024.

The proposed Shell LNG Project is aimed at addressing the gas shortfall that would result from the depleting Malampaya field.

Shell Energy is considering securing a environmental compliance certificate (ECC) for the proposed project in the third quarter of this year.

Following the finalisation of the detailed design, the firm plans to start pre-construction within the next year, followed by full construction work in the first quarter of 2024.

Earlier this month, Shell announced that it had received approval from Britains regulator for a revised plan to develop the Jackdaw gas condensate field.


SpaceX fires at least 5 employees over internal letter criticizing CEO Elon Musk

SpaceX has fired at least five employees who were involved with circulating a letter around the company that was critical of CEO Elon Musk, according to two people familiar with the company who declined to be named and an internal email from President and COO Gwynne Shotwell.

Shotwell, in a companywide email Thursday, said SpaceX terminated a number of employees involvedand called blanketing thousands of people across the company with repeated unsolicited emailsunacceptable, according to copies of the email obtained by CNBC. The open letter, first reported by The Verge, was circulated earlier this week. More than 400 SpaceX employees signed the letter in just under a day and a half, The Verge reported Friday.

We have too much critical work to accomplish and no need for this kind of overreaching activism,Shotwell wrote, adding the letter upset manywithin the company and made employees feel uncomfortable, intimidated and bullied.

The letter was addressed to company executives, according to media reports, and described the billionaires public behavior as a frequent source of distraction and embarrassmentfor SpaceX employees.

The New York Times first reported the SpaceX firings. SpaceX did not immediately respond to CNBCs request for comment.


StarbucksNorth American head to leave the company as chain shakes up leadership

StarbucksNorth American president Rossann Williams is leaving the company and will be replaced by the head of the coffee chains Asia Pacific division.

The announcement Friday marks the latest change to the company under interim CEO Howard Schultz, who returned to the top job in April after the departure of former CEO Kevin Johnson. Schultz is slated to stick around in the role through around the end of the year, after the board names a long-term successor. In his time so far, Schultz has paused the companys stock buyback program, committed $1 billion to raise wages and improve cafes and vocally pushed back against union efforts.

As we embark on the next chapter, we have made a difficult, but necessary change to our North America business; a change that creates new leadership for a new era at Starbucks,John Culver, the companys chief operating officer, wrote in a memo to employees viewed by CNBC. The decision was not taken lightly and was one preceded by discussion about a next opportunity for Rossann within the company, which she declined.

Williams has worked for Starbucks since 2004, when she joined the coffee chain after stints at Toys R Us and Blockbuster. Over the last year, shes been one of the public faces of the companys efforts to curb unionization efforts by its baristas. More than 150 Starbucks cafes in the U.S. have voted to unionize, as of Friday.

The Wall Street Journal first reported Williamss departure.

Sara Trilling, who currently serves as president of StarbucksAsia Pacific business, will succeed Williams in the role, effective Tuesday. Trilling has been with the company for two decades, starting out in its creative studio working on its retail store design and working her way up. Williams will help with her transition through June and Cliff Burrows, president of the companys Americas division, will also assist in an advisory role.

American Airlines

American Airlines CEO vows to improve pilot pay as wages at other carriers rise

American Airlines CEO Robert Isom said this week that the company will revise its pay proposals for its 14,000 pilots, acknowledging pay standards have increased since the company made its most recent offer before the pandemic.

The Fort Worth, Texas-based airline had previously floated a 4% date-of-signing increase plus 3% annual raises after that. Then Covid-19 roiled the industry and put talks between carriers and labor unions throughout the industry on hold.

It was industry-leading at the time we proposed it,Isom said in a video message to pilots posted Monday, which CNBC reviewed. As the pandemic wanes, the standard for compensation has gone up.

Isoms message came days after two of Americans subsidiaries, regional carriers Piedmont and Envoy, extended big raises to its pilots, including a temporary 50% pay hike through the end of August 2024, in hopes of easing a pilot shortage that has curbed growth plans.

United Airlines last month became the first major carrier in the pandemic to reach a contract deal with its pilotsunion, the Air Line Pilots Association. Union leadership is set to vote on that agreement next week. If passed, it will go to pilots for a vote.

We will take other carriersratified agreements, including Uniteds, into account and update our pay proposals quickly when details are known,Isom said. Our team will be paid well and be paid competitively. You are not going to fall behind network peers.

Americans pilots and those at other carriers, including Deltas, have picketed in recent months to protest the grueling schedules airlines have sold to capitalize on the rebound in travel demand.

Dennis Tajer, spokesman for the Allied Pilots Association, Americans pilotsunion, said the company has to do more than raise wages.

There is no work-life balance,he said Wednesday.

Without providing details, Isom said Americans new proposal will include better benefits and quality-of-life provisions.


Chinas posts slowest growth ever in Chinas mid-year shopping festival

June 19, 2022  Chinas e-commerce giant has reported the slowest growth in sales in the countrys mid-year shopping festival amid a recent Covid-19 outbreak. reported a total transaction volume of 379.3 billion yuan ($56.47 billion) during the June 18 shopping festival this year, increasing by 10.3 percent from last year.

This years growth rate is largely decrease from the 27% of last year, as consumer appetite in China has been hit by lockdowns to halt the Omicron variant of coronavirus.

Data from showed Beijing and Shanghai, the two largest Chinese cities in terms of economy and purchasing power, have picked up momentum for recovery after Omicron hit.

Apart from first tier cities, we are further improving delivery services in urban and rural areas,JD said in a statement, referring to its efforts during build up its supply chain infrastructure and digital intelligence technology.

JD has added three more automated logistics parks in Langfang, Hebei province, Dezhou, Shandong province and Zhengzhou, Henan province to increase its coverage of same or next day delivery for lower-tier cities ahead of Chinas 618 shopping festival.

Known as 618 because the shopping festival falls on June 18, 618 was first conceived by to rival Alibabas November 11 SinglesDay Festival. It is being closely watched as a sign of Chinese consumer appetites for spending given pressure from the pandemic, as China looks to recover from the coronavirus pandemic.

Shopping festivals have traditionally been popular in China, with many buyers making a large chunk of purchases to benefit from the massive discounts brands offer to lure shoppers.

But there were already signs last year of low consumer demand at such events, when rival Alibaba reported sales growth of just 8.5% during its Singles Day bonanza, which is its slowest growth rate ever.

Ant Group

Central bank hasnt accepted Ant Groups application to set up a financial holding company, says insider

June 17, 2022 So far, the central bank has not accepted Ant Groups application to set up a financial holding company, Chinese financial media Yicai reported Friday evening Beijing time, citing source familiar with the matter.

According to the relevant regulations, the central bank will make an announcement after accepting the application for the establishment of a financial holding company submitted by the applicant,the sources said.

As the news emerged, Alibabas NYSE-listed stock started to fall. Its stock price increased 10% before the market opened on reports that the central bank has accepted applications from its financial affiliate.

Earlier today, Reuters quoted sources as saying that Chinas central bank has accepted Ant Groups application to set up a financial holding company, bringing it a step closer to resume IPO plan.

In November 2020, Chinese authorities abruptly pulled the plug on Ants IPO, set to raise $37 billion in the worlds biggest listing, saying Ant failed to meet the issuance and listing conditions or information disclosure requirements due to changes in the financial technology regulatory environment.

Ant had been valued as a tech firm for its IPO, but the forced change to a financial holding company will make it subject to capital requirements and regulations similar to those for banks.

To formally revive its mega-listing, Ant has to secure the key financial holding license and complete its restructuring. The fintech company has been working with financial regulators for months on an extensive overhaul. The central banks agreement to review the application indicate that the company could soon obtain the long-awaited license.

Apart from the financial holding company license, Ants personal credit-scoring joint venture has applied for a permit, as part of the fintech majors business revamp.


Ford CFO says inflation has erased Mustang Mach-E profits, but isnt hurting demand for new vehicles

Ford Motors CFO said Wednesday that the company isnt yet seeing consumer demand for new vehicles drop off but rising commodity costs have wiped out the profit it initially expected to make on its electric Mustang Mach-E.

Demand for new Fords and Lincolns continues to exceed supply, which is still constrained by an ongoing global shortage of semiconductor chips, Ford CFO John Lawler told analysts at a conference hosted by Deutsche Bank even after the company raised vehicle prices to offset the effects of inflation.

For the most part, those price increases have preserved Fords profit margins, Lawler said. But the price rises werent enough to offset the impact of climbing costs on the companys electric Mustang Mach-E.

The model saw its costs increase substantially due to sharply higher battery material costs. While the Mach-E was profitable when it was first launched in late 2020, thats no longer true, he said.

Despite the upbeat report on demand, Lawler noted one emerging sign that consumers may be reaching their inflationary limits: Ford Credit, the companys financing arm, has seen an uptick in delinquencies,or late payments.

Lawler said Ford is taking the possibility of a U.S. recession seriously and the company has modeled several possible scenarios for a downturn.

Still, Ford and the broader auto industry are in a different position today than in past recessions, when the company typically held high inventories and increased discounts that eroded margins, Lawler said.

We dont have that today,Lawler said. Were very lean on inventories. We have an order bank thats significant at over 300,000 units. ... As an industry and as a company, were heading into this [possible recession] in a much different position than weve ever been in before.


BYD is selling so many electric cars its become one of the top three automakers in China

BEIJING Chinese electric car maker BYD saw sales more than double in May, solidifying the companys climb into the ranks of the top three automakers in China.

Thats according to data by the China Passenger Car Association which was released Friday. China is the worlds largest auto market.

Backed by Warren Buffetts Berkshire Hathaway, BYD is also a battery maker thats become a major electric car brand in China and some of its models are vying with Tesla in popularity.

So far this year, not only has BYD continued to dominate new energy vehicles, which include hybrid and battery-powered cars, but the company also climbed into the ranks of the top three brands in China by passenger car sales.