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  • Apr 21, 2014
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Lai See
PUBLISHED : Saturday, 19 January, 2013, 12:00am
UPDATED : Saturday, 19 January, 2013, 5:12am

Brokers say there's no need to pay, just vote for us

BIO

Howard Winn has been with the South China Morning Post for two and half years after previous stints as business editor and deputy editor of The Standard, and business editor of Asia Times. His writing has also been published in the Far Eastern Economic Review, the Wall Street Journal, and the International Herald Tribune. He writes the Lai See column which focuses on the lighter side of business.
 

Institutional Investor poll again, we have received more comment from the marketplace since our last piece. This confirms that there is a frenzy of activity within the industry over these polls. So much so that it is reaching absurd levels. The word comes down from on high within the company, we are told. Individuals are told it is good for them and good for the company to feature in the awards.

The upshot is that everyone gets their proverbial knickers in a twist and downs tools to beg for votes. Asset managers and traders are rung up on the flimsiest of excuses for a chat supposedly about investment or trading opportunities which end with "er, and if you wouldn't mind giving us a vote in the II polls that would be great. It's very important for us this year".

At some stage this discussion goes completely loony. In a perfect world, institutions pay brokers for their research through commission income. Sometimes they use the ideas and trade with another broker because it provides them with blocks of IPO shares, for example. Now we have a situation where people are saying "it's OK, don't pay us, just vote for us", which for a business is surely lunacy.

 

Eat, drink, and enjoy the harbour

Readers of Lai See will not be surprised by the story that the Harbourfront Commission is to be upgraded to a body with executive powers since it was foretold here in September last year. The purpose is to give the body the authority to push ahead with the redevelopment of the harbour without being bogged down by bureaucracy.

There are numerous government department agencies that like to be involved in anything relating to harbourfront development. The new body will even have authority to issue liquor licences to food and beverage outlets. The idea is, after years of almost criminal neglect by numerous administrations, to at last give Hong Kong the harbourfront it deserves. It is, after all, supposed to be one of the world's finest harbours, or at least what's left of it is. Injudicious reclamation in the past has considerably reduced its size.

The Harbourfront Commission envisages keeping the prime sites out of the hands of property developers and turning them into areas where people can walk along the waterfront, eat, drink, be entertained and enjoy themselves. Hardly a revolutionary concept, but why has it taken Hong Kong so long to reach this point?

 

The big dream

David Robson's big dream is to create the largest oil and gas company in Central Asia. While some way off at this stage, the company he founded, Tethys Petroleum, of which he is chairman, president and chief executive, took a big step in this direction last month with a farm-in agreement with Total and China National Petroleum Corp which is expected to be approved by the Tajik government shortly.

In a deal initially worked out in Hong Kong, the three are to form a partnership company to explore for oil and gas in Tethy's enormous exploration acreage amounting to some 35,000 square kilometres - almost the size of Switzerland - in southwest Tajikistan. An audit of the area last July raised the potential from 1.5 billion barrels oil equivalent of oil and gas to 27 billion barrels.

Robson says that the potential is more than estimates for the remaining recoverable potential in the North Sea. He adds that assuming mainland China's demand for gas does not increase, the area has sufficient gas to fuel its needs for the next 25 years.

However, China's needs will increase and although some of this will be met from conventional and unconventional sources, there will still be a shortfall which will have to be covered either by expensive liquefied natural gas or pipeline gas. If sufficient gas is found, the partnership is likely to build a pipeline into Xinjiang. With CNPC as a partner the venture should be assured of a market, though there could be competition for the gas from India and Pakistan.

At least one analyst has described the farm-in deal as transformational for Tethys, which has a market cap of C$169 million (HK$1.32 billion), since it gives it cash to fund operations in Kazakhstan and Uzbekistan. It's also a major deal for Tajikistan, since it will accelerate exploration of its resources.

 

Have you got any stories that Lai See should know about? E-mail them to howard.winn@scmp.com

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John Adams
If we finally have a harbour front which we can all enjoy ( after the past 3 - 4 years of scaffolding all along the north side of the Island not to mention the noise) it will be a good thing. I see Nick Brooke is in the centre of this and I note he nominated CY for CE, so that can't be a bad thing. Nick sounds like my kind of bloke : no nonsense, lots of common sense and straight dealing for the betterment of us all

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