Daily Brief Energy/Materials: Shin Etsu Chemical, Rio Tinto Ltd, Natural Gas, Arrow Exploration Corp, Delta Dunia Makmur, Crude Oil, Trigon Metals and more

• Today, Shin Etsu Chemical (4063 JP) announced a second buyback this year (first ¥100bn was announced in May, buying back 16.695mm shs (0.83%). This time, ~¥94bn via Own-Share Tender Offer.
• Three non-life insurers and two banks who together hold 6+% will sell a total of ~1.01% at ~10% below last. They will then sell the rest of their shares later.
• Cute, but not enough. Shin-Etsu is cash-rich, securities-rich, receivables and inventory-rich. And nearly ¥1trln of EBITDA. They are a key part of the tech infrastructure. They can borrow.

• Rio doubles down on lithium investment in Rincon, with a US $2.5 billion expansion plan
• BHP and Rio have historically had differing views on commodities, with examples in Potash, aluminium, and mineral sands
• Rincon project aims to expand production to 60,000 tonnes per annum, with heavy reliance on DLE technology for extraction and processing

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• US natural gas prices rose 6.6% for the week ending 13/Dec, driven by rising LNG exports, despite downward pressure from milder winter forecasts.
• Henry Hub Put/Call volume ratio rose to 1.10 from 1.06 (06/Dec) the previous week as put volumes rose by 21.5% WoW, while call volumes increased by 16.5%. 
• Henry Hub OI PCR fell to 0.83 from 0.84 compared to last week. Call OI rose by 5.4% WoW, while put OI increased by 4.8%.

• The AB-1 (Alberta Llanos) exploration well has encountered four main hydrocarbon bearing reservoirs with a total true vertical depth of 121 feet, including the C7, Gacheta, Guadalupe, and Ubaque formations.
• The main pre-drill targets were the C7 and the Ubaque formations.
• The Gacheta and Guadalupe formations carried a higher risk, and encountering these two formations is a positive.

• PT Delta Dunia Makmur Tbk (BUMA) is a holding company with an operational entity, PT Bukit Makmur Mandiri Utama, which is one of the largest coal-mining contractors in Indonesia by production volume.
• Its two other subsidiaries, PT Banyubiru Sakti and PT Pulau Mutiara Persada, are non-active entities which held coal exploration permits.
• Formerly a textile business, BUMA was transformed into a real estate company in 2008 following the sale of the erstwhile business. 

• Crude Oil (CL1) has been steadily downtrending since June 2022. More recently (from the start of October) a flat bottom started to form, with attempts to rise higher.
• The front-month future (Feb25) is range bound at the moment, between 71 (top) and 66 (bottom).
• Our models see a strong barrier at 73, and a decent support at 67 for the next 2 weeks, check the insight to get all the details.

• What you need to know: • Trigon provided an update on the previously proposed acquisition of the Kombat Mine by Horizon Corporation.
• • Subject to final negotiation and approvals, the acquisition will consist of $30M plus between $10-20M in additional payments based on specific operational milestones.
• • TM also announced it has signed a binding loan agreement with Horizon for up to $5M to allow for the project to continue to advance.