Group 1 - The core issue facing the southwest gas-based fertilizer companies is the significant disparity between rising natural gas prices and falling urea market prices, leading to operational challenges and potential production halts [1][2] - Natural gas prices have reached 2.29 yuan per cubic meter, with expectations of further increases during the winter heating season, while urea prices have dropped to 1500 yuan per ton, below production costs [1] - The average price of natural gas for chemical use in the southwest region is projected to rise by 32% from approximately 1.75 yuan per cubic meter in 2021 to nearly 2.3 yuan per cubic meter by 2025, contrasting sharply with the decline in urea prices from 2900 yuan per ton to around 1500 yuan per ton [1] Group 2 - There are over 100 gas-based chemical enterprises in the southwest region, consuming nearly 10 billion cubic meters of gas annually, with an estimated urea production capacity of 8.3 million tons in 2024 [2] - The southwest gas-based fertilizer companies are crucial for spring agricultural supply and are considered a foundational element of the southwest industrial system, highlighting the need for government attention and optimization of natural gas pricing mechanisms for sustainable development [2]

近日，西南气头化肥企业向《中国化工报》记者表示，目前作为其原料的天然气价格已达2.29元/立方 米，下个月就要到供暖季，按惯例气价还要进一步上涨，但尿素市场价格则已跌至1500元/吨。企业已 经难以继续运行，减停产将成为现实。 目前西南地区共有100余家气头化工企业，每年用气近100亿立方米。2024年，云贵川渝尿素产能约830 万吨。 相关企业告诉记者，肥企现在的情况是各家都有较高库存，尿素市场价格则已经跌破1600元/吨，降到 了1500元/吨。而企业的原料和公用辅料以及动力的成本就要超过1500元/吨，所以目前边际贡献全无。 为此，西南各肥企不得不陆续减产停产。因为在产品售价低于物耗成本的情况下，开得越多亏得越多。 对此，相关企业再次呼吁，西南气头化肥企业是春耕保供的重要力量;气头化工企业还是西南工业体系 的重要基础和支撑，既有战略价值，又有现实需求。希望国家对相关企业的生存发展多加关注，优化天 然气定价机制，使西南天然气化工产业链实现可持续发展。 "下个月将进入冬季供暖。在每年11月15日到第二年3月15日的冬季供暖季节，按惯例天然气价格都是要 上涨的。所以在这样的情况下，如果没有其他变化的话，我们1 ...

Core Points - The signing of a legally binding memorandum marks a significant step forward for the construction of a new natural gas pipeline system through Mongolia, with an annual capacity of 50 billion cubic meters, known as the "Power of Siberia 2" pipeline, which will connect to China [1] - The project is set against a backdrop of changing geopolitical dynamics, with Russia's gas supply to Europe sharply reduced, making China the largest buyer of Russian gas [1][7] - The negotiation process for the "Power of Siberia 2" project has faced challenges, particularly regarding pricing, but a balance has been found that maintains a price discount for China compared to European prices [1][6] Pricing Mechanism - The pricing for Russian gas supplied to China is based on a formula linked to oil prices, with a nine-month lag, ensuring stable and favorable prices for China [4][10] - In Q1 2021, the average price for Russian gas supplied to China was $121 per thousand cubic meters, compared to an overall export average of $171, indicating a discount of approximately 30% [2][4] - This pricing mechanism contrasts sharply with the spot market pricing used for European gas, which has been volatile [4][6] Strategic Importance - The "Power of Siberia 2" project is strategically significant for both Russia and China, as it provides China with a secure energy supply amid rising tensions with the U.S. and potential disruptions to maritime energy routes [8][10] - Russia's need for stable export revenue and a reliable market for its gas has made China a critical partner, enhancing China's negotiating power [6][8] - The project is expected to take 3 to 5 years to complete, with an estimated total investment of 1.5 trillion rubles, and it benefits from existing infrastructure, reducing development time and costs [10][12] Geopolitical Implications - The pipeline is seen as a key factor in reshaping the Eurasian energy landscape and will inject new momentum into the comprehensive strategic partnership between China and Russia [12] - As the project progresses, the deepening energy cooperation between the two countries is anticipated to have profound implications for the global energy market [12]

Investment Rating - The report does not explicitly state an investment rating for the natural gas industry Core Insights - Europe is a major consumer of natural gas and has a complex pricing mechanism influenced by market liberalization, supply stability, and geopolitical factors since 1970 [5][14] - The evolution of natural gas pricing in Europe has transitioned from a cost-plus model to oil-linked pricing, and now to a gas-to-gas competition model, highlighting the importance of supply stability [5][14] - The ongoing "de-Russification" of energy supply in Europe and the slow development of alternative supply routes may lead to persistent regional price premiums [5][15] Summary by Sections 1. Historical Pricing Evolution (1970-2024) - The natural gas market in Europe has undergone significant changes influenced by energy crises, geopolitical shifts, and technological advancements [16] - From 1970 to 2000, the market transitioned from a cost-plus pricing model to oil-linked pricing, with long-term contracts being crucial for supply stability [6][17] - The period from 2001 to 2009 saw a significant price increase of 308.5% due to rising oil prices and increased demand for natural gas as an alternative energy source [7][39] - The years 2010-2015 were marked by price fluctuations due to the Fukushima disaster and the European debt crisis, with prices not surpassing 2008 levels despite temporary spikes [53][58] - From 2016 to 2019, LNG trade accelerated, reshaping the supply landscape, with prices experiencing a 140% increase in 2016 before a subsequent decline of 62.3% [8][15] - The period from 2020 to 2024 was characterized by extreme price volatility driven by the COVID-19 pandemic and the Russia-Ukraine conflict, emphasizing the need for energy diversification [9][15] 2. Implications for the Natural Gas Industry - The reliance on a single supplier, particularly Russia, has exposed Europe to significant geopolitical risks, necessitating a diversification of supply sources [9][15] - The urgency of energy transition in China is highlighted, with a need for improved policy coordination and technological advancements to reduce transition costs and risks [9][15] - The report suggests that China should enhance monitoring of industrial gas costs and establish price warning mechanisms to improve industrial resilience [9][15]