It seems that the company normally releases an announcement before the end of January, so there should be a quarterly update out within the next week or so.
It will be worth keeping an eye on what the company has got to say about the' China' side of the business in the next update. Based on media reports from that country over the past few weeks, there is some reason to suspect that since the start of this year, a few new major water projects have been given the green light by the Chinese authorities.
You might have already seen this one: the graphic below is taken from an ABC article on Monday, which stated that the People's Bank of China had injected a massive 1.1 trillion yuan into the Chinese economy last week as an economic stimulus measure, in response to China's slowing GDP growth.
This quote is from an ANZ economist, mentioned in a Reuters report yesterday on the same topic:
“I believe they want to see an aggressive target (above 6.5 percent) as they celebrate the 70th anniversary (of the establishment of the PRC)”“China can’t rely on exports or a very difficult manufacturing sector, but we see an upside in infrastructure. The government will approve a lot more projects in the pipeline. 2019 will be more of a domestic story, especially on the investment side.”
Some other reports I've read from China suggest that some of this money may be being directed to major water projects. Here is one such a report I noticed yesterday, from China's Global Times, which includes some interesting comments from the Chinese Ecology and Environment Minister:
China has met its annual target for pollution control in 2018, with more blue skies, cleaner waters and greener mountains. "We have successfully delivered all the obligatory targets set for 2018 and stayed in line with the timetable outlined by the 13th Five-Year Plan," Chinese Ecology and Environment Minister Li Ganjie said during a work meeting that concluded Saturday.
...Thorough action has been taken to clean up 1,009 "black and malodorous" water bodies in 36 major cities and 1,586 water sources, Li said, adding that "defense of lucid waters" would be a primary task for 2019. In 2019, China will put the Yangtze River restoration project in full swing, clean up more "black and malodorous" water bodies, achieve environment improvement in the Bohai Sea through comprehensive measures, and launch a water quality campaign in rural areas, Li said.
While that sounds promising, it is difficult to find information of specific Chinese water projects that have commenced in recent weeks. I've only been able to track down two: the first one I noticed was the new stage of the Suzhou Creek rehabilitation project, which seems to have kicked off in late December. The second one is a major water project falling within the construction of something called the 'Xiongan New Area', which appears to have been given the green light by the authorities at the start of the month following on from several years of planning.
The Baiyangdian Lake falls within this 'Xiongan New Area', which is about 100 Kilometres to the south of Beijing. This article on the topic from last week below gives an overview on the Baiyangdian Lake situation:
Environmental remediation essential to success of new area, academician says
Targeted environmental standards and a smart management system will be created to clean up the Baiyangdian Lake basin - not only to restore the ecology but to boost the prosperity of Xiongan New Area - according to authorities in Hebei Province.
The full nine-chapter draft for Baiyangdian (2018-35) is yet to be released to the public. It was developed by the Chinese Academy of Sciences' Research Center for Eco-Environmental Sciences, based on a philosophy of supporting the new city with wetlands in ways that are good for both, a report from China National Radio said.
The plan follows instructions from President Xi Jinping, who has paid particular attention to the new area and to the lake and its surrounding environment. During a visit to Xiongan in February 2017, Xi said that the Baiyangdian Lake basin should be restored and protected as new construction goes forward.
Dubbed North China's "kidney", Baiyangdian covers about 360 square kilometers and embraces the largest wetland on the North China Plain.Without Baiyangdian, Xiongan New Area will not succeed, Qu Jiuhui, an academician of the Chinese Academy of Engineering and researcher at the research center, told the radio network.
The treatment of the current pollution is one of the most urgent tasks, Zhao Yu, an associate researcher at the research center, was quoted as saying. International experience in lake basin reclamation will be sought for the lake's governance and protection, Zhao said, adding that the lake and the eight rivers that feed it will be considered a single, integrated water ecosystem.
The plan also listed a series of policies, laws and regulations that will be drafted, and described mechanisms that will be employed for both the use and protection of Baiyangdian.
Note in that second last paragraph, the mention that 'International experience' will be sought for the lake's governance and protection.
A researcher called Shao Baoqing, quoted later in the article, notes that the Baiyangdian Lake is affected by four key pollutants- chemical oxygen demand, ammonia nitrogen, total phosphorus and total nitrogen.
This would seem to fall within Phoslock's domain, and the mention of 'International experience' might also be suggestive that the company will have a role in the restoration of this lake.
It sounds encouraging, and so hopefully these major water projects at Suzhou Creek and Baiyangdian Lake will translate into more work for the company in China. Let's hope the next quarterly update makes for interesting reading.
PET Price at posting:
33.5¢ Sentiment: None Disclosure: Held
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