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As I read the deal LNC will be getting a 1/3 cut of all the UCG /GTL plants that will be built in China through the JV in return for their IP technology. Their Chines partner is very big and it seems quite capable of rolling out the infrastructure.China is a huge market (obviously..) Creating a JV vehicle with a strong Chinese company seems like the most practical way LNC could gain access to this market. The Chinese are just too practical to allow a foreign company to effectively take away the value of all their underground coal.The project also underpins the necessity for China to gain energy independence for liquid fuels.I think this makes excellent commercial sense. Great win/win negotiation.
As I read the deal LNC will be getting a 1/3 cut of all the UCG /GTL plants that will be built in China through the JV in return for their IP technology. Their Chines partner is very big and it seems quite capable of rolling out the infrastructure.
China is a huge market (obviously..) Creating a JV vehicle with a strong Chinese company seems like the most practical way LNC could gain access to this market. The Chinese are just too practical to allow a foreign company to effectively take away the value of all their underground coal.
The project also underpins the necessity for China to gain energy independence for liquid fuels.
I think this makes excellent commercial sense. Great win/win negotiation.
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