Citic Resources mulls listing of non-oil assets

PUBLISHED : Thursday, 28 June, 2007, 12:00am
UPDATED : Thursday, 28 June, 2007, 12:00am

Citic Resources Holdings, a unit of state-owned conglomerate Citic Group, may seek a separate listing for its non-oil assets to unlock their market value amid the metal mining boom, says chairman Peter Kwok Viem.

Its metal assets include a 48 per cent stake in Citic Dameng Mining Industries, a Guangxi Zhuang Autonomous Region-based manganese mining joint venture, which owns about 22 per cent of the country's total proven reserves of the metal used in stainless steel production, according to a Kim Eng Securities research report.

The price of manganese has risen from 10,000 yuan a tonne at the end of last year to a recent high of 36,000 yuan, according to Citic Resources' chief executive Sun Xinguo.

Citic Resources also owns a 22.5 per cent stake in an aluminium smelter in Australia operated by US aluminium giant Alcoa, which also owns a 55 per cent stake.

Other non-oil assets include a 77.6 per cent stake in Australia-listed metals trading unit Citic Australia Trading, two joint ventures and a direct stake in Australia-listed Macarthur Coal.

Meanwhile, Mr Kwok said he 'has not heard of' PetroChina's opposition to its planned acquisition of a 90 per cent stake in a company which has development rights in the Liaohe oil field in Bohai Bay, northeast China.

PetroChina is the field's operator and has a veto right on the change in shareholding. A PetroChina source said earlier it might block the deal as it wanted to keep it away from rivals.

Citic Resources has an option on the acquisition, but only has until the end of next month to exercise it.

Mr Kwok said Citic Resources had not discussed the matter with PetroChina, but added that the two companies' top management 'have very good relations'.

Shareholders yesterday approved Citic Resources' purchase from its parent of a 47.3 per cent stake in Kazakhstan oil firm Karazhanbasmunai and related assets for US$1 billion.

The Kim Eng report said management expected output from Karazhanbasmunai to double to 90,000 barrels a day between 2010 and 2012 from its current output, and estimated production costs at about US$25.50 per barrel.

Going up

Boom in metal mining prompts Citic Resources to take advantage

Manganese price has risen from 10,000 yuan a tonne at the end of last year to a recent high of 36,000 yuan