Main Web Site : http://www.fortune-oil.com/

CBM Partner Web site : http://www.molopo.com.au

IC Write Up : 21st Apr 2006 IC Write Up

Last Major News : 18th Apr 2006 Coal Bed Methane Project

Prelims : 27th Apr 2006 Prelim Results Link

Latest Broker Forecasts : Oriel 7th April 2006 BUY

Prelim Results and Further Updates due around 25th to 27th April 06

ABOUT FORTUNE OIL

For over a decade Fortune Oil PLC has focused on investments and operations in oil & gas infrastructure projects in China and remains one of the few overseas companies operating oil terminals and supplying natural gas in China, all in partnership with the countrys largest oil & gas companies
Fortune Oil PLC is incorporated in England and Wales and is subject to UK Listing Rules and compliance regulations. The largest shareholders are First Level Holdings Limited, Vitol and major Chinese state-owned corporations.

NATURAL GAS :




China will be the world's largest growth market for natural gas as supplies of this clean and economically attractive fuel become more accessible. Fortune Oil's investments in natural gas are principally through Fu Hua, a joint venture with a PetroChina affiliate, which on-sells gas from the pipelines supplying Beijing. In north China Fortune Oil controls and operates distribution pipelines and city gas reticulation systems as well as facilities to produce and transport Compressed Natural Gas (CNG).
Fortune Oil is now one of the leading providers of CNG in Beijing, providing clean fuel for buses, households and factories. In October 2004 Fortune Oil also became the first overseas company to supply LNG (Liquefied Natural Gas) to users in China, delivering LNG by road to the ancient city of Qufu, the home of Chinese philosophy.

OIL TERMINALS :
Maoming SPM

Fortune Oil established the Maoming Single Point Mooring (SPM) in December 1994 to supply crude oil to Sinopecs Maoming refinery, the largest in southern China. The SPM now delivers 10% of Chinas crude oil imports. It allows VLCCs (Very Large Crude Carriers) of up to 280,000 tonnes to moor and deliver crude oil via a 15 km sub-sea pipeline. The SPM is owned and operated by a joint venture company, Maoming King Ming Petroleum Company Limited, and the other main shareholder is Sinopec Maoming Petrochemical Corporation.
The SPM buoy is commonly used throughout the world for loading and unloading liquids but the Maoming SPM remains the only buoy system in China used for importing crude oil. Fortune Oil believes that the SPM concept is a cost-effective solution for importing crude oil into China as many ports are shallow and will become more congested as demand increases. The only alternative to a buoy system in many ports is to dredge channels for large tankers. The SPM has provided significant cost savings to the Maoming refinery through its low operating costs and VLCC capability.

Products Terminals

The oil products market in China is in the process of deregulation and this will allow a larger role for foreign companies in the import and distribution of refined products. Fortune Oil remains one of the few foreign companies with interests in products terminals.
Fortune Oil and Vitol jointly developed the West Zhuhai Oil Products Terminal at the western entrance of the Pearl River Delta. These facilities came on stream in 1998 and comprise 240,000 cubic metres storage and jetties for receiving and distributing refined products. It is one of the few products terminals in south China able to handle 80,000 dwt ocean-going tankers. A controlling stake was sold to PetroChina which uses the terminal for supply of diesel to south China.
In addition Fortune Oil controls a LPG terminal and supply business (Fu Duo), which has 80,000 customers in Zhanjiang city, and owns storage facilities in Shantou. Prior to the restructuring of the China oil industry in the late 1990s, Fortune Oil was also a major participant in the gasoline retail market and in oil trading. We continue to operate two gasoline stations in Beijing but our trading activities are limited to low-risk domestic trading.

Blue Sky Aviation Oil

The South China Bluesky Aviation Oil Company owns and operates the refuelling infrastructure at 15 airports in south China. These include Wuhan, Guilin and the new Guangzhou Baiyun International Airport. Fortune Oil and BP each hold 24.5% of the joint venture and Beijing-based China Aviation Oil Supply Corporation (CAOSC) holds 51%. The consumption of jet fuel in China is rising significantly, particularly at Guangzhou because of pent-up demand in the Pearl River Delta.
The new Guangzhou airport was opened in August 2004. The construction cost was US$2.3 billion and it is almost four times the size of the old airport in downtown Guangzhou. The new airport is capable of handling 25 million passengers and 1 million tonnes of cargo per year and ranks number three for aviation fuel sales in mainland China.

Losing premium listing is disappointing..... FTO has had a public relations negative outlook for a long time.. This hasn't helped.. A good price for the gas assets, but what now?
We hold 50% of CGGL which gives us about 4.9% direct interest in CGH.
Bluesky investment 25%
Armenian mine 82% and some bits here and there..
Cash about £110 million to help write down debt...
Profits for 2012 may be good and divi may rise....but going forward for year end 2013 profits are not looking good and neither will divi rises.....
Cant see where the profits will be made up....

so why do you continue to hold?

The reasons I continue to hold are 5 fold at this stage.

1. With this deal..there may very well be a surprise special dividend announced to share holders, which is possible on the grounds of less investment money needed for asset on the ground as they are mostly sold (talking gas here)

2. This company is changing rapidly into something it wasn't a year ago.. namely an investment vehicle.. Exposure to big China gas market is still there with potential for HKSE listing down the road..

3. CGH could still be taking over in the next year and at a more lucrative price. It is already double the price the last bid was pitched at.

4. Dart Energy International is close to IPO shortly and it is been speculated that FTO could be an industry partner in the IPO. They certainly would have the money even after paying down debt and special dividend. CBM was one of the reason I bought into this company. Taking a stake in DEI would be a very good move. They have some great assets, including Scotland.

5. I can afford to continue to hold as I am under no pressure to sell presently..

My postings are merely commentary on what I see in the short term and as possibly reasons why investors are not hurrying into this stock.
I guess I am always reviewing risk/reward balance..

12 February 2013

Fortune Oil PLC

("Fortune Oil" or "the Company")

Approval of Proposed Transaction by China Gas Holdings


Fortune Oil is pleased to announce that shareholders in China Gas Holdings Limited approved the Proposed Transaction on 8 February 2013, with 99.96% of the votes cast in favour of the appropriate resolutions. As such, this condition to the Share Purchase Agreement has now been satisfied.


All definitions in this announcement have the same meaning as those in the Circular posted to shareholders on 1 February 2013. A copy of the Circular is available on the Company's website www.fortune-oil.com. The Circular has also been lodged on the National Storage Mechanism and can be viewed on www.morningstar.co.uk/uk/NSM.

Gone dead here just like the share price...again....
I really don't think anything can improve this share over the long term....
Some good accounts from shareholders who attended the EGM...

I don't understand why the price is so depressed.

The company will be full of cash, much more than the market value soon.

They can distribute some of the cash to shareholders by increasing the dividend.

Feb 21, 2013 - City natural-gas distributor China Gas, which fended off a hostile takeover bid last year from rival ENN Energy and oil and gas major China Petroleum & Chemical (Sinopec), has made steady progress in negotiations with Sinopec on forming joint ventures, according to its finance chief.

The two firms were in advanced talks on setting up a venture to distribute liquefied petroleum gas (LPG) produced by Sinopec's oil refineries and sell compressed natural gas (CNG) at its petrol stations, China Gas chief financial officer Eric Leung Wing-cheong said.

"We are also in talks on Sinopec's possibility to raise its stake by buying more China Gas shares," Leung said. "From China Gas' point of view, we would prefer that the sale of shares and the joint-venture agreements be negotiated and signed as a package."

Frank Li Yuntao, the general manager of investor relations at China Gas, said the talks were "in the final stages".

Leung said China Gas would inject its LPG distribution assets into the proposed joint venture, and the company would become a non-exclusive distributor of the gas from Sinopec in regions where China Gas has LPG storage facilities.

China Gas' retail sales of the gas amount to about 1 million tonnes a year, while Sinopec's domestic refineries produce about 12 million tonnes a year.

On the proposed CNG joint venture, Leung said Sinopec might let China Gas convert some of its 30,000 petrol stations in select cities in more than 10 provinces so that they can also sell the gas to private cars and commercial vehicles. Sinopec may share some of the profit from the CNG retailing business.

China Gas runs about 160 CNG stations that serve taxis and buses in suburbs. Leung said the firm aimed to add 30 to 40 such stations each year.
.
(scmp.com, Feb 21, 2013)

China Gas closed@ hk$ 6.780 up over 3 %

They were offering hk3.6 (if i remember correctly) while FTO was buying. Now they start adding at hk6.7.

Average price that FTO pad is less than hk4, I believe.

This reminds me of DGO when it was 11p, moved out of the UK and gradually recovered to 40, now above 550.

Well..looks like the party is over...back below 10p again...
Really think CGH could go to HK$10 and it would not matter to FTO cause its an unrealizable investment due to been locked in with Minghiu...

CGH has risen over 7.5% this morning,up over 8.5% at one point.

CGH closes@ HK$ 7.390. up 8.6%.

I am repeating myself- FTO is reminding me of DGO when it was 10p.

DGO was being is a billion dollar company now. FTO can do the same.

FTO is one of the largest shareholders of CGH (market cap 33.5bln HKD). FTO will receive $200m cash plus 6% interest for two months from CGH soon, and good dividend, on its holding. FTO assets is valued well above £0.5 bln now, while market cap is just £200m !!!.

Correct me if I am wrong.

Considering a June Future

WHat do you mean, Shortie?

A spreadbet, June future long position. Its a leveraged bet that this stock will increase in value before 18/06/2013, I pay a margin of 40% on this stock for the position, so can apply a decent amount of leverage to the trade.

I see. Thank you.

@10.39 June Future long position bought

150k?

Not sure what it equates to in shares ahoj, anyway level2 trades are equity trades so not relevant to a spread position.