ENERGY
TransCanada sues US
TransCanada has formally filed a US$15 billion suit against the US government for blocking its controversial project for an oil pipeline linking Canada with the Gulf of Mexico, legal documents show. The company first announced its intention to sue in January, but then sought negotiations toward “an amicable settlement of the dispute” surrounding the Keystone XL pipeline, according to legal documents posted on its Web site. Unable to settle, the company formally filed suit late on Friday, saying that denial of a permit to complete the pipeline was “unjustified” under the North American Free Trade Agreement and that the decision also exceeded US President Barack Obama’s constitutional powers. The Calgary-based company is seeking US$15 billion for losses it says it suffered because of the pipeline’s rejection.
ENERGY
Crescent expects oil rally
Crescent Petroleum Co, an oil and natural gas producer in Egypt and Iraq, expects crude prices to improve this year as supply becomes more in line with demand. The UK’s decision to leave the EU will not have a lasting effect on crude prices and London will remain a center for international oil and gas companies, chief executive officer Majid Jafar yesterday said in an interview in Dubai. Oil fell 4.9 percent in New York and London on Friday after the UK voted to exit from the 28-member bloc. Benchmark Brent crude settled at US$48.41 per barrel. Crude has gained about 30 percent this year on supply disruptions from Nigeria to Canada and falling production in the US. OPEC members have produced crude without limits since 2014 in an effort to maintain market share and force higher-cost suppliers such as US shale to rein in production.
SHIPPING
Ship set to cross canal
A giant Chinese-chartered freighter was to nudge its way through the Panama Canal yesterday to mark the completion of nearly a decade of expansion work forecast to boost global trade. The vessel, especially renamed COSCO Shipping Panama, was to inaugurate the widened canal in an hours-long voyage from the Atlantic to the Pacific Ocean via a new shipping lane and gigantic locks that have been fitted to the century-old waterway. The expansion work carried out since 2007 — and delivered two years late at a cost of at least US$5.5 billion — allows a new generation of much larger ships, known as Neopanamax class vessels, to ply the canal. The expansion is also to allow Panama to lure massive liquified natural gas tankers for the first time. Panama’s plan behind the expansion is to triple the US$1 billion in revenues it gets from canal shipping fees.
UNITED STATES
Firms taken by surprise
The risk that Britain could yank itself out of the EU had been telegraphed for more than a year, but even US companies with “Brexit” contingency plans have said they were shocked it is now on track to become reality, and are just beginning to work through all of the implications. Caught off guard, some US firms have rushed to place foreign currency orders hedging against further declines in the pound. Many are seeking legal advice on the impact on trade agreements and regulations, while others begin to consider a potential drop in demand from European economies, company executives and consultants told reporters. International law firm Dechert LLP received so many calls from business clients after Thursday’s referendum result became clear that it set up a special hotline to handle the volume.
ISSUES: Gogoro has been struggling with ballooning losses and was recently embroiled in alleged subsidy fraud, using Chinese-made components instead of locally made parts Gogoro Inc (睿能創意), the nation’s biggest electric scooter maker, yesterday said that its chairman and CEO Horace Luke (陸學森) has resigned amid chronic losses and probes into the company’s alleged involvement in subsidy fraud. The board of directors nominated Reuntex Group (潤泰集團) general counsel Tamon Tseng (曾夢達) as the company’s new chairman, Gogoro said in a statement. Ruentex is Gogoro’s biggest stakeholder. Gogoro Taiwan general manager Henry Chiang (姜家煒) is to serve as acting CEO during the interim period, the statement said. Luke’s departure came as a bombshell yesterday. As a company founder, he has played a key role in pushing for the
China has claimed a breakthrough in developing homegrown chipmaking equipment, an important step in overcoming US sanctions designed to thwart Beijing’s semiconductor goals. State-linked organizations are advised to use a new laser-based immersion lithography machine with a resolution of 65 nanometers or better, the Chinese Ministry of Industry and Information Technology (MIIT) said in an announcement this month. Although the note does not specify the supplier, the spec marks a significant step up from the previous most advanced indigenous equipment — developed by Shanghai Micro Electronics Equipment Group Co (SMEE, 上海微電子) — which stood at about 90 nanometers. MIIT’s claimed advances last
CROSS-STRAIT TENSIONS: The US company could switch orders from TSMC to alternative suppliers, but that would lower chip quality, CEO Jensen Huang said Nvidia Corp CEO Jensen Huang (黃仁勳), whose products have become the hottest commodity in the technology world, on Wednesday said that the scramble for a limited amount of supply has frustrated some customers and raised tensions. “The demand on it is so great, and everyone wants to be first and everyone wants to be most,” he told the audience at a Goldman Sachs Group Inc technology conference in San Francisco. “We probably have more emotional customers today. Deservedly so. It’s tense. We’re trying to do the best we can.” Huang’s company is experiencing strong demand for its latest generation of chips, called
GLOBAL ECONOMY: Policymakers have a choice of a small 25 basis-point cut or a bold cut of 50 basis points, which would help the labor market, but might reignite inflation The US Federal Reserve is gearing up to announce its first interest rate cut in more than four years on Wednesday, with policymakers expected to debate how big a move to make less than two months before the US presidential election. Senior officials at the US central bank including Fed Chairman Jerome Powell have in recent weeks indicated that a rate cut is coming this month, as inflation eases toward the bank’s long-term target of two percent, and the labor market continues to cool. The Fed, which has a dual mandate from the US Congress to act independently to ensure