DCM - Risk of significantly higher input gas prices - AGM Note
  • 2023-06-14T00:00:00
  • Company Research

- 41 shareholders (representing 81% of total outstanding shares) attended DCM’s AGM on June 12. The meeting discussed the company’s business guidance for 2023, H1 2023 preliminary results, the outlook for urea prices, and amendments to the gas purchasing agreement.
- Shareholders approved DCM’s proposal to amend its gas purchasing agreement for Block PM3 CAA and Block 46-Cai Nuoc with PetroVietnam (PVN). As a result, the proportions of input gas volume from domestic gas fields and gas purchased from Malaysia are changed from fixed weightings of 90% and 10%, respectively, to flexible weightings and will be finalized at year-end by PVN. DCM stated the proportion of gas volume from each source is 50%:50% in the worst case. This amendment implies upside to our weighted average input gas price projection and downside risk to our 2023-2027F earnings forecasts, pending a fuller review.

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