New Times Energy Corporation Limited (HKSE stock code: 166) is an oil and gas exploration and production company, headquartered in Hong Kong and traded on The Stock Exchange of Hong Kong. The Group’s activities are located in the Northwest Basin in the province of Salta, Argentina and in the state of Alaska, USA. The Group will continue to enrich its oil and gas portfolio through exploration, and strategic acquisitions to broaden the Group‘s income streams, aiming to deliver significant growth in cash flows and reserves to its shareholders.
Vision & Mission
We develop energy for the new times. Diversify for climate change and the environment.
Further to the Group’s oil discovery in the Chirete Concession as first announced on 12 December 2018, I am pleased to report that following the successful commissioning of a newly built facilities, the Group has resumed uninterrupted oil production from 5 November 2019 at an initial rate of 600 barrels a day.
This latest achievement marks a significant milestone in the history of the Group, and underlines its decision in April 2015 to farm-in to the block. The start of oil production at Chirete Concession in 2019 also represents an important milestone for the Province of Salta, Argentina, since this is the first new commercial oil production in decades for the region. It has been welcome news for the newly elected authorities of the province, as they try to promote and attract further oil exploration investment in the region.
With the Group’s application for an exploitation permit in the Chirete Concession coinciding with the National and Provincial Elections of Argentina and inauguration in November and December 2019, and the government summer recess in January 2020, the Group is presently waiting for the permit to be granted by the new
authorities of the Province of Salta. Due to the coronavirus pandemic recently spreading to Argentina, the Group faces an indefinite delay in the granting of the exploitation permit, which when received will formalise the Group’s entitlement to produce hydrocarbon for the next 25 years in the Chirete Concession.
Though the Group is pleased with the progress it has made in the Chirete Concession, the Group for the year ended 31 December 2019 is disappointed to report a consolidated net loss after tax of HK$2,290 million. This was primarily attributable to the recognition of the provision for full impairment loss on the Group’s
exploration and evaluation assets in the Tartagal Oriental and Morillo Concessions of HK$2,243 million, as first announced on 6 February 2020, following the unexpected rejection of the Group’s extension application by the previous Salta provincial authorities on 17 September 2019. Further details are disclosed within this annual report.
During the year, Argentina continued to struggle with hyperinflationary pressures, as well as the continued devaluation of its currency against the US Dollar (“US$”). Following the experience in 2018 of a 47.6% rate of inflation, the country in 2019 experienced a further 54% inflation, the highest on record since
1991. On the other hand, the Argentine Pesos (“ARS”) devalued by 70.3% against the US$ from ARS35.1 per US$ at the start of the year to ARS59.8 per US$ by 31 December 2019.
Argentina has historically been a difficult country for the Group and other international companies to operate in. Whilst the inauguration on 10 December 2019 of Mr. Alberto Fernandez as the new President of Argentina, and Mr. Gustavo Saenz as the new Governor of the Province of Salta are a cause for renewed optimism, the
Group remains cautious about the country’s political and economic outlook.
With the recent onset of the coronavirus pandemic significantly reducing global economic activity and oil demand, and the oil price war between Saudi Arabia and Russia sending prices plummeting in the first quarter of 2020, the oil industry and the Group faces very challenging times ahead. The Group will continue to actively manage and look for cost rationalization opportunities.
New Times Energy continues to proactively manage and structure its business to best serve the interests of its shareholders. The Group is committed to maximizing shareholder value by exploring and developing oil and gas prospects in a safe, environmentally, socially and ethically responsible manner.
The Group is well aware of the importance to continually reassess and diversify its current business and geographical portfolio to better position itself for the future. Thankfully, the Group continues to maintain a healthy cash position to enable it to actively seek out value adding and complementary investment opportunities in the energy sector, wherever that may be in the world.
The Group is mindful of the increasing global trend and appetite for renewable energy sources, particularly in the developed economies. Though the Group’s principal business is that of oil and gas exploration and production, the Group is also interested in diversifying into the renewable energy business.
Following a recent internal review, the Group has subsequently evolved its vision and mission statement to better encapsulate its strategic purpose, this shall now be defined as:
“We develop energy for the new times. Diversify for climate change and the environment”
In closing, I would like to take this opportunity to once again, express my sincerest gratitude to the Board, the management team, and all staff members for their efforts and dedication during the year, and in achieving the historic milestone of oil production in the Chirete Concession. I am also much obliged to our shareholders, investors, business partners, bankers, customers and suppliers for their continued and invaluable support. We are facing unprecedented times with the coronavirus pandemic affecting both locally and globally, I sincerely hope you all can stay safe, stay aware and stay healthy.
|Executive Directors||Non-Executive Director||Independent Non-executive Directors|
|Mr. CHENG Kam Chiu, Stewart
Mr. TANG, John Wing Yan
|Mr. LEE Chi Hin, Jacob||Mr. YUNG Chun Fai, Dickie
Mr. CHIU Wai On
Mr. HUANG, Victor
Mr. CHENG Kam Chiu, Stewart (Chairman and Executive Director)
Mr. CHENG, Kam Chiu Stewart, aged 65, was appointed as anexecutive Director in February 2008 and the Chairman in May 2009. Mr. Cheng holds a Bachelor’s degree in Civil and Environmental Engineering from the University of Wisconsin-Madison, the United States of America (“USA”); a Master’s degree in Civil Engineering from the University of California, Berkeley, USA; and a Master’s degree in Business Administration from the Chinese University of Hong Kong. Being a member of The Hong Kong Institution of Engineers, Mr. Cheng is a professional engineer with extensive experience in property development and construction management. Mr. Cheng is a member of the Shunde District, Foshan City Committee of the Chinese People’s Political Consultative Conference since November 2006.
Mr. Cheng joined Hip Hing Construction Company Limited in 1984 as a project manager and was subsequently appointed as director. From 1993 to 1997, Mr. Cheng was transferred to New World Development (China) Limited as a director and an assistant general manager, overseeing property development in the People’s Republic of China (“PRC”). He was a director of NWS Service Management Limited from 1997 to 2006, and was mainly responsible for the construction and the electrical and mechanical engineering businesses and pursuing business opportunities in the PRC. Mr. Cheng is the managing director of Cheung Hung Development (Holdings) Limited, principally engaging in property development in both Hong Kong and the PRC. He was an executive director of International Entertainment Corporation from January 2008 to June 2017, which shares are listed on The Stock Exchange of Hong Kong Limited (the “Stock Exchange”).
Mr. TANG, John Wing Yan (Executive Director and Chief Executive Officer)
Mr. TANG, John Wing Yan, aged 67, was appointed as an executive Director in June 2017. Mr. Tang joined the Group as general manager in August 2015. He brings with him over 20 years of senior management experience and has held top executive positions with various international companies prior to joining the Group.
Formally trained as a structural engineer, Mr. Tang was a Chartered Engineer in the United Kingdom (“UK”) as well as a Registered Professional Engineer in USA and Canada. Author and co-author of peer-reviewed publications in several technical journals and conferences, he is also the holder of U.S. Patent US6329589 pertaining to wireless transmission of solar power for exterior curtain wall in buildings.
Mr. Tang holds a Bachelor’s degree in Civil Engineering, Magna Cum Laude, from the University of Massachusetts, USA; a Master’s degree in Engineering from the University of California, Berkeley, USA; and a Graduate-Level Diploma in Financial Engineering from Stanford University, USA.
Mr. LEE Chi Hin, Jacob (Non-executive Director)
Mr. LEE, Chi Hin Jacob, aged 37, was appointed as a non-executive Director in March 2019. Mr. Lee is currently a senior vice president of Chow Tai Fook Enterprises Limited (“CTFE”) with responsibilities in making strategic and private equity investments globally. CTFE is an indirect subsidiary of Chow Tai Fook Capital Limited which is a controlling shareholder of the Company. Mr. Lee joined CTFE in March 2013 and has over 10 years of professional experience in corporate finance, investment, international capital markets and asset management. He previously worked at the investment banking department of The Hongkong and Shanghai Banking Corporation Limited and Deutsche Bank AG in Hong Kong. Mr. Lee holds a Master of Science degree in Accounting and Finance from The London School of Economics and Political Science to the University of London in London, United Kingdom and a Bachelor of Business Administration degree from the University of Michigan in Ann Arbor,
United States of America. He is also a Chartered Financial Analyst Charterholder
Mr. Lee is currently a non-executive director of Integrated Waste Solutions Group Holdings Limited which shares are listed on the Stock Exchange.
Independent Non-executive Directors
Mr. YUNG Chun Fai, Dickie (Independent Non-Executive Director)
Mr. YUNG, Chun Fai Dickie, aged 67, was appointed as an independent non-executive Director in March 2013. Mr. Yung holds a Master’s degree in Business Administration from the University of East Asia, Macau. He is a member of the Institute of Management and a fellow of the Chartered Management Institute. Mr. Yung has
been engaged in finance and banking businesses for over 26 years. He was the chief executive officer of Landbridge Holdings Limited, the deputy chief executive officer of Industrial & Commercial Bank of China (Macau) Limited and an executive director, deputy general manager and alternate chief executive officer of Industrial
& Commercial International Capital Limited (currently known as ICBC International Holdings Limited), a wholly-owned subsidiary of Industrial & Commercial Bank of China Limited.
Mr. CHIU Wai On (Independent Non-Executive Director)
Mr. CHIU, Wai On, aged 50, was appointed as an independent non-executive Director in November 2006. Mr. Chiu is a member of the Hong Kong Institute of Certified Public Accountants and a fellow member of the Association of Chartered Certified Accountants in the UK. He possesses extensive professional experience in accounting
and auditing services. Mr. Chiu is currently an independent non-executive director of DeTai New Energy Group Limited, whose shares are listed on the Stock Exchange.
Mr. HUANG, Victor (Independent Non-Executive Director)
Mr. Huang, Victor, aged 49, was appointed as an independent non-executive Director in June 2020. Mr. Huang graduated from The University of California, Los Angeles in the United States with a Degree of Bachelor of Arts in Business Economics. He was a former partner of PricewaterhouseCoopers and KPMG with around 30 years of experience in accounting, audit, finance and merger and acquisitions. He is a certified accountant of The Hong Kong Institute of Certified Public Accountants and a Certified Independent Director of the Shanghai Stock Exchange.
Mr. Huang is currently an independent non-executive director of COSCO Shipping Energy Transportation Co., Ltd. (stock code: 01138.HK), Trinity Limited (stock code: 00891.HK), Manpower Group Greater China Limited (stock code: 02180.HK), Scholar Education Group (stock code: 01769.HK), Topsports International Holdings Limited (stock code: 06110.HK), China Bright Culture Group (stock code: 01859.HK), LBX Pharmacy Chain Co., Ltd. (stock code: 603883.SS) and Qingdao Haier Biomedical Co., Ltd. (stock code: 688139.SS) respectively.
|Mr. Peter Kwok Ming Mak||
NTE – Group Financial Controller
Peter joined the Group in October 2015 as a Project Manager and is currently the Financial Controller of the Group. Peter holds a M.A. Honours degree in Business Organisation from Heriot-Watt University, Edinburgh, UK. He is a qualified Chartered Accountant of The Institute of Chartered Accountants in England and Wales (ICAEW), with over 20 years professional accounting and auditing experience. Prior to joining the Group, Peter gained over 6 years relevant oil and gas industry experience in his previous roles as audit manager with KPMG and financial controller with Schlumberger, where his last posting was with WesternGeco in Penang, Malaysia.
|Mr. Pablo Cavalleri||
HLGL – Operations Manager
Pablo is a Geologist and is currently the Operations Manager at HLGL. He graduated at the National University of Salta Argentina in 2005 with a bachelor’s degree in Geology. Pablo has 14 years of experience in the oil and gas industry, predominately in Argentina and Saudi Arabia. Pablo joined HLGL in January 2014 initially as a Development Geologist but later promoted to Operations Manager from 2017. Prior to HLGL, he worked in companies such as Schlumberger, Orion Excel Company, Schlumberger Middle East And Asia as a Field Engineer (Saudi Arabia), and YPF Argentina as a Development Geologist. Pablo is an author and co-author of several written publications including a publication in technical national and international congress for the Oil Discovery in Ordovician Prerift Sequences Las Breñas Formation, Lomas de Olmedo Sub-Basin, Northwestern Argentina; Argentinian Geological Congress, August 2017, Tucumán-Argentina; Exploration and Development Hydrocarbon Congress, November 2018, Mendoza – Argentina, and AAPG 2019 International Convention & Exhibition, Buenos Aires, August 28th 2019, Argentina. Pablo is also the Vice-President of Directive committee of IAPG (Oil and Gas Argentinian Institute), branch office Tartagal, Salta Argentina since December 2017.
|Mr. Pablo Blasco||
HLGL – Operations Superintendent in Chirete Field (Exploratory Conventional Field)
Pablo graduated as an Industrial Engineer in 2008 from the Universidad Nacional de Salta. He then went onto further studies for another year obtaining a postgraduate qualification in Exploration and Production of Hydrocarbons with specialization in Production, YPF-Petroskills. Pablo has accumulated 10 years of experience in the oil and gas industry, having worked with YPF prior to joining HLGL. Pablo was an Operations Superintendent in the Palmar Largo Field in 2014-2018 and from 2012-2014, a Production Engineer in both mature conventional field and exploratory unconventional field.
|Mr. Facundo Diez Barrantes||
HLGL – Chief Accountant
Facundo was born and raised in the Province of Salta but studied and worked in Buenos Aires for 4 years. Facundo has a Master’s in Business Administration (MBA) from Universidad Catolica Argentina in Buenos Aires and is also a Certified Public Accountant of the National University of Salta. Facundo is currently the Chief of Accounting Department at HLGL. Facundo has 10 years of experience in the labor market, of which 6 years been with international companies belonging to the hydrocarbon activity. Facundo’s specialization is in Finance, Accounting and Reporting, with tasks that generally consist of generating financial and management reports to facilitate decision-making by management and the board. Throughout the years as an Accountant, Facundo managed and prepared financial statements under local standards, IFRS and US GAAP of the companies.
New Times Energy is committed to its Corporate Social Responsibility Policy, Health and Safety, Environmental Protection, Human Resources and Labor Practices, and Community Involvement and Sustainable Value Creation when conducting business activities in China and other countries when we operate.
Health and Safety
The Group will operate under the principle of ‘Health & Safety as the First Priority’. We will use the international best practices of safety management to ensure the health and safety of our employees, contractors, customers and communities in which we operate.
Based on government safety laws, regulations and standards, we will continue to improve our safety management. Our goal is to achieve an injury-free workplace by providing an environment free of any hazards that may be detrimental to health and safety.
We promise: all items of plant and equipment are operationally safe and all our working places are free of hazards. We also promise that all our employees including managers of all levels and general staff are properly trained in safe working practices. We will ensure that both managers and workers have a clear understanding of their responsibilities for taking positive actions to improve health and safety.
Health and Safety System Components:
We are committed to providing a working environment that is both safe and fit and ensures that health and safety issues are a priority for all business operations.
The Group has set up an operational Environmental Management System (EMS) to direct the management of the environmental risks of the Group’s operations. The EMS documents include the establishment, resourcing and implementation of the Group’s environmental management programs. The site environmental performance is monitored and communicated to the Group and is then utilized to revise the effectiveness of the EMS system.
Environment Management System Components:
Human Resources and Labour Practices
We strive to be an employer of choice in regions in which we operate. We will:
Community Involvement and Sustainable Value Creation
We strive to be a good corporate citizen wherever we invest and operate in our projects. We recognize our responsibility to work in partnership with the local communities. We also appreciate the importance of sustainable value creation for the communities in which we operate and we will strive to develop relationships that allow for this development.