China’s central bank says it has asked the country’s payments giant Ant Group Co Ltd to shake up its lending and other consumer finance operations, the latest blow to its billionaire founder and controlling shareholder Jack Ma.
The announcement came more than a month after Chinese regulators abruptly suspended Ant’s blockbuster $37bn initial public offering in Shanghai and Hong Kong and only days after the country’s antitrust authorities said they had launched a probe into Ma’s e-commerce conglomerate Alibaba Group Holding Ltd.
Chinese regulators and Communist Party officials have set about reining in Ma’s sprawling financial empire after he publicly criticised the country’s regulatory system in October for stifling innovation.
Regulators have urged Ant to rectify financial regulatory violations, including in its credit, insurance and wealth management businesses and overhaul its credit rating business to protect personal information, People’s Bank of China (PBOC) Vice Governor Pan Gongsheng said on Sunday.
Pan’s comments stopped short of calling for a breakup of Ant, yet pointed to a significant operational restructuring. Ant should set up a separate holding company to ensure capital adequacy and regulatory compliance, Pan said.
Ant should also be fully licensed to operate its personal credit business and be more transparent about its third-party payment transactions and not engage in unfair competition, Pan added.
The Hangzhou-based firm now needs to move forward with setting up a separate financial holding company to ensure it has sufficient capital and protect personal private data, the central bank said.
Ant said in a statement it would establish a “rectification” working group and fully implement regulatory requirements.
The series of edicts represent a serious threat to the expansion of Ma’s online finance empire, which has grown rapidly from a PayPal-like operation into a full suite of services over the past 17 years.
Before regulators intervened, Ant’s public listing would have valued it at more than $300bn, with existing backers including United States-based private equity firms Carlyle Group Inc and Silver Lake Management LLC.
“This is the culmination of a string of regulations and sets the direction for Ant’s business going forward,” Zhang Xiaoxi, a Beijing-based analyst at Gavekal Dragonomics, told the Bloomberg news agency. “We haven’t seen clear indication of breakup yet. Ant is a giant player in the world and any breakup needs be to be cautious.”
Ma was advised by the Chinese government to stay in the country, Bloomberg has reported, citing a person familiar with the matter. Ma could not be reached for comment, the Reuters news agency said.
Pan said Ant representatives met on Saturday with officials from the PBOC and other Chinese banking, securities and foreign exchange regulators.
Defiance of regulations
During the meeting, regulators pointed out Ant’s issues including its poor corporate governance, defiance of regulatory demands, the use of its market advantage to squeeze out competitors and harming consumers’ legal interests, according to Pan.
The central bank said Ant used its dominance to exclude rivals, hurting the interests of its hundreds of millions of consumers.
Ant traces its beginnings to Alipay, which was launched in 2004 as a payment service, and is 33 percent owned by Alibaba. Its Alipay app dominates digital payments in China, with more than 730 million monthly users. The Hangzhou-based company also built an empire connecting China’s borrowers and lenders, securing short-term loans within minutes.
Last month, China issued draft rules aimed at preventing monopolistic behaviour by internet firms and the Politburo this month promised to strengthen anti-monopoly efforts in 2021 and rein in “disorderly capital expansion”.
China also warned internet giants this month to brace for increased scrutiny, as it slapped fines and announced probes into mergers involving Alibaba and Tencent Holdings Ltd.
Ontario reports 1,958 new COVID-19 cases amid changes to vaccines rollout – CBC.ca
Premier Doug Ford is scheduled to hold a news conference beginning at 1 p.m. at Queen’s Park.
You’ll be able to watch it live in this story.
Ontario reported another 1,958 cases of COVID-19 on Monday, as experts heading the province’s vaccination campaign outlined how they are responding to delays in the delivery of the Pfizer-BioNTech vaccine.
The new cases include 727 in Toronto, 375 in Peel Region and 157 in York Region. They come one year after the first confirmed infection of the novel coronavirus in Canada was found in a patient in Toronto.
Other public health units that saw double-digit increases yesterday were:
- Windsor-Essex: 85
- Niagara Region: 82
- Durham Region: 62
- Hamilton: 55
- Halton Region: 54
- Ottawa: 51
- Middlesex-London: 46
- Simcoe Muskoka: 41
- Waterloo Region: 39
- Wellington-Dufferin-Guelph: 35
- Huron-Perth: 29
- Southwestern: 28
- Chatham-Kent: 22
- Lambton: 19
- Eastern Ontario: 11
- Haliburton, Kawartha, Pine Ridge: 11
(Note: All of the figures used in this story are found on the Ministry of Health’s COVID-19 dashboard or in its Daily Epidemiologic Summary. The number of cases for any region may differ from what is reported by the local public health unit, because local units report figures at different times.)
It was the fewest number of new infections logged on a single day in nearly a week. The seven-day average of daily cases continued its steady decline down to 2,371, the lowest it has been since Dec. 30, 2020. It has been trending downward since its peak of 3,555 on Jan. 11.
Notably, however, Ontario’s network of labs processed just 35,968 test samples for the virus despite capacity for more than 70,000 daily. Collectively, they reported a test positivity rate of 5.5 per cent.
Another 2,448 cases were marked resolved in today’s report. There are now 23,620 confirmed, active infections provincewide, down from a high of more than 30,000 earlier this month.
According to the province, there were 1,398 people with COVID-19 in hospitals, though as is often the case on weekends, about 10 per cent of hospitals did not submit data. A total of 397 patients were being treated in intensive care, while 283 required a ventilator to breathe.
Public health units logged another 43 deaths of people with COVID-19, pushing Ontario’s official death toll to 5,846.
Meanwhile, at a media briefing this morning, members of Ontario’s vaccine distribution task force said the province will delay first doses for health-care workers and essential caregivers amid a shortage of the Pfizer product.
Available doses of vaccines will instead be channelled only to residents of long-term care and at-risk retirement homes, as well as First Nations seniors living in elder care settings. The goal is to have all those who fall into one of these groups be given a first dose of vaccine by Feb. 5, 10 days earlier than first planned.
Health workers in the long-term care sector as well as essential caregivers were slated to be vaccinated during the initial stages of the province’s rollout, alongside residents. Due to delays in expected shipments of the Pfizer vaccine, however, the focus in coming weeks will be solely on people at the highest risk of severe illness or death, officials said.
The shift means that front-line health-care workers in other settings, such as those doing direct patient care in hospitals, will have to wait longer than originally planned to be immunized.
Provincial officials also said there is uncertainty surrounding expected shipments of the Pfizer vaccine the weeks of Feb. 8 and Feb. 15. The federal government has not yet specified how many doses Ontario should anticipate receiving in that period, they said, making it difficult to provide a granular timeframe for when those shots will be administered.
Moreover, all of Ontario’s 34 public health units are expected to have vaccines available for priority groups by the end of this week. As of this morning, there were 14 health units that thus far had not received any doses for administration.
The province said it gave out 5,537 doses of vaccines on Sunday. A total of 286,110 shots have been administered, while 71,256 people have received a second dose.
100,000 students return to school
Schools in seven public health units across southern Ontario reopened for in-person classes today.
Education Minister Stephen Lecce said that means 100,000 students will be returning to the classroom for the first time since before the winter break.
The province is implementing more safety measures in areas where schools are reopening, including requiring students in grades 1 through 3 to wear masks indoors and when physical distancing isn’t possible outside as well.
It’s also introducing “targeted asymptomatic testing” in those regions.
While it’s been more than a month since students in southern Ontario have been in the classroom, classes resumed in the northern part of the province on Jan. 11.
The provincial government has said the chief medical officer of health is keeping a close eye on the COVID-19 situation in public health units where schools remain closed to decide when it’s safe for them to reopen.
But the province has said that in five hot spot regions — Windsor-Essex, Peel, York, Toronto and Hamilton — that won’t happen until at least Feb. 10.
The public health units where schools are reopened today were:
- Grey Bruce
- Haliburton, Kawartha, Pine Ridge
- Hastings and Prince Edward Counties
- Kingston, Frontenac and Lennox & Addington
- Leeds, Grenville and Lanark
- Renfrew County
BlackBerry shares soar 40% to highest level since 2011 – CBC.ca
Shares in Canadian technology company BlackBerry are changing hands at their highest level in almost a decade on Monday, as investor enthusiasm for the once high-flying stock has mysteriously returned.
BlackBerry shares were trading at almost $25 a share when the Toronto Stock Exchange opened on Monday, up more than $7 or more than 40 per cent from Friday’s level.
The stock has been quietly rallying for several days now, before taking off on Monday. When 2021 began, the company was worth just over $8 a share. It’s now worth about three times that.
The company has had a number of small pieces of good news in recent weeks, but nothing that would explain Monday’s rise in share price.
Last month, the company signed a deal with Amazon to work on a connected cloud software program for cars, and then in mid-January BlackBerry favourably settled a patent fight with Facebook, but Morningstar analyst William Kerwin says neither development is enough to explain Monday’s surge.
“BlackBerry’s stock movement doesn’t appear to be rooted in any fundamental firm changes, in our view,” he said in an email to CBC News.
Instead, the company has seemingly become one of many recent firms to benefit from a groundswell of retail investor enthusiasm on popular online message boards such as Reddit, regardless of whatever the Wall Street community thinks. Of the 11 analysts who cover the company, nine have a “hold” rating on the company’s shares, and two have “sell” recommendations.
None suggest buying. But that’s not stopping retail investors from doing exactly that.
“BB is moving on Reddit boards,” said Ophir Gottlieb, CEO of trading firm Capital Market Labs. “Not much else to say.”
More than 14 million of the company’s shares changed hands in Toronto on Monday. That’s more than three times the usual volume, and half the trading day is still to come.
Colin Cieszynski, chief market strategist with SIA Wealth Management in Toronto, says BlackBerry is just the latest in a series of companies that have seen unexpected rises in share prices in recent weeks.
The current stock market rally has driven up the valuation of huge companies, and now investors are moving down the food chain looking for bargains.
“Smaller stocks don’t have as much liquidity or stock available to trade so a sudden stampede of cash chasing into a smaller cap stock can swamp supply and cause the kind of massive spikes on no news that have started to really pop up in the last week or so,” he said in an email to CBC News.
“So to me, these moves are more about market sentiment, relative performance, and supply/demand issues rather than fundamental news.”
Kerwin agrees that there are no fundamental changes to BlackBerry’s business that properly explain the price surge.
“We think there’s likely a shift in market sentiment about BlackBerry, perhaps with investors getting more bullish about [their] prospects after the fact. There’s above average trading volume this morning, which might also point to [a] retail investor swell.”
Gottlieb notes that BlackBerry isn’t the only company being pushed up by the sudden trend. “This is not a single stock story, it is a behavioural story.”
These 2 oil companies say they've reached 'net-negative' emissions through carbon capture – CBC.ca
Banks, grocery stores, pop makers — it seems like every day, another company is pledging to become a “net-zero” emitter of greenhouse gases — at some point years or decades in the future.
But a pair of Alberta companies say they’ve not only achieved the mark but are actually storing more emissions underground than they are producing from their operations.
Enhance Energy and Whitecap Resources both use carbon capture technology to stash emissions far below the surface.
For Enhance, the company buys the CO2 from a refinery and a fertilizer plant in central Alberta. The CO2 is transported through a pipeline to its facility north of Red Deer, where it is pumped into an old oil reservoir. The CO2 helps to free up more oil and increase the amount of crude produced at the site, a process known as enhanced oil recovery (EOR).
The private Calgary-based firm began operations last fall. So far, executives say about 4,000 tonnes of CO2 is stored underground every day, which they say is the equivalent of taking 350,000 vehicles off the road — a point of pride for the company.
Because they’re getting the CO2 from the two large plants but only extracting a small amount of oil at this point, on balance, they say they’re burying more CO2 than their oil will produce.
“I get a warm feeling when I come on site and see that injection well,” said chief executive Kevin Jabusch. “That’s very rewarding. It makes the 10-year effort to put this project together worth it.”
Federal goal is net zero by 2050
Many in the industry, as well as some environmental groups, support the development of carbon capture technology, although there are concerns about how emission reductions are calculated and whether capturing carbon disincentivizes industries from taking action to produce fewer emissions in the first place.
The federal government has set a target of reaching net zero by 2050 and released a blueprint to achieve that goal in December, including hiking the carbon tax from the current price of $30 per tonne to $170 by 2030.
The world should be looking for the cheapest, lowest-carbon source of energy.– Kevin Jabusch, Enhance Energy
Instead of calling Enhance an oil company, Jabusch describes it as a “carbon mitigation company” and said if the carbon tax rises as expected, the day might come when Enhance no longer will need to produce oil anymore to be profitable.
Currently, the company generates revenue from oil production and from selling the carbon credits it gets for sequestering emissions. Alberta charges a carbon tax on heavy industrial emitters, but the province also has a system for companies to earn credits by reducing or storing emissions.
Jabusch said the Alberta government’s carbon tax program for large industrial emitters measures and monitors the carbon they sequester, but that data is not available publicly.
Injecting CO2 to increase output
Production from Enhance’s Clive field is around 200 barrels of oil per day, but with CO2 injection, the company expects output to gradually grow to between 4,000 and 5,000 barrels per day over the next five years.
“We’re very negative today over the full cycle of our of our operation,” said Jabusch, “and in the long term, we think it would be very close to zero.
“Where carbon pricing is headed, we think there’s going to be a strong incentive to maximize the amount of CO2 we put in the ground.”
Whitecap has a similar, but much larger, carbon capture project in Saskatchewan. Emissions from a coal power plant in the province and from a coal gasification facility in neighbouring North Dakota are transported to an oilfield near Weyburn, south of Regina.
In each of the last two years, about two million tonnes of CO2 were injected and stored, executives said. The figures are currently being audited.
The Weyburn facility has operated since 2000 and was acquired by Whitecap in 2017. With growing focus on sustainability and climate change, investor interest in the project has intensified over the last year, said chief executive Grant Fagerheim.
“We’re starting to get some of the bigger funds, not just from Canada, but in the U.S. for sure, and around the world,” he said.
Unlike Enhance, Whitecap does not account for the emissions that will be generated from the eventual use of its oil, saying it has no control over how it is used, making it difficult to calculate.
Varying definitions of ‘negative’ emissions
How a company determines whether it claims net-zero or net-negative status varies across the industry and can depend on the emissions that a given company is counting, which are often broken into three groups, or scopes:
- Scope 1 includes direct emissions from the activities of an organization, such as its industrial operations or the heating of its buildings.
- Scope 2 refers to indirect emissions, such as if the company uses electricity from a CO2-generating source, such as a gas-fired power plant.
- Scope 3 also includes indirect emissions, but ones that are out of the organization’s control. For an oil company, Scope 3 includes tailpipe emissions from vehicles or when oil is converted into plastics. The combustion of fuel is often the largest source of emissions from a barrel of oil, compared to production, transportation and refinery activity.
For Enhance, the company said it is net negative on Scope 1, 2 and 3 while Whitecap said it’s net negative on Scope 1 and 2.
By that definition, Whitecap expects to remain net negative even as its oil production increases by an estimated 65 per cent this year following deals to acquire Torc Oil & Gas and NAL Resources Management.
“We will still be a net-negative emitter,” he said. “It is nice to be in this position at this particular time.”
Projects can carry hefty price tag
Fagerheim says he would like to build new carbon capture facilities but that they can be complex projects requiring a large capital investment and new infrastructure, including pipelines.
“I believe that people will see the light of day, but ultimately, we’re doing what’s best for ourselves, and carbon capture utilization and storage is potentially a way into the future,” he said.
The two largest carbon capture projects in Alberta, including the Carbon Trunk Line that Enhance is part of, cost more than $1 billion to develop, and both required hundreds of millions of dollars in government support.
There’s growing interest in carbon capture projects. Last week, Tesla chief and billionaire Elon Musk promised a $100 million US prize for development of the “best” technology to capture carbon dioxide emissions.
In Canada, one of the challenges with investing in a carbon capture project is the uncertainty about the level of carbon tax in the future since the approach to carbon pricing varies by political party.
WATCH | Is carbon capture a solution for the oil industry and climate change?
Environmental leaders have often had mixed feelings about carbon capture facilities because while harmful emissions are stored underground, the technology may just be enabling industries to maintain the status quo and not focus enough on reducing the use of fossil fuels.
“The science is fairly clear: we are going to need carbon capture in order to tackle the climate crisis,” Jan Gorski, an analyst with the Pembina Institute, a non-profit organization that produces research, analysis and recommendations on policies related to Canadian energy.
“Enhanced oil recovery is a way to ramp up carbon capture and drive down the costs and improve the technology as we work to eventually deploy that to tackling these more challenging sources where we really don’t have a great way to deal with the emissions right now.”
Knowledge gained from carbon capture projects operating now could eventually help reduce emissions in tougher-to-tackle industries such as cement plants and steel production, he said.
Some environmental groups suggest the investment in carbon capture facilities would be better spent elsewhere, such as building renewable energy projects. For example, a company could slash emissions in producing the oil, but consumers would still pump out emissions when they use it as a fuel for transportation or heating.
‘The devil is really in the details’
There is also the issue of double counting. Experts say it’s important for any action toward reducing emissions to be properly assessed. For instance, if the emissions from a power plant are used by an oil company to increase the production of an oilfield, both companies can’t take credit for the carbon-capture project.
“I think the key thing is to be clear-eyed about the end goal,” said David Keith, a Harvard University professor of applied physics and public policy based in Canmore, Alta.
Keith also founded and sits on the board of Carbon Engineering, which aims to capture emissions directly from the atmosphere.
“For me anyway, the end goal has to be driving emissions down to zero to protect us from climate disaster and also doing it in a way that does the least damage to our economy and, in Alberta, trying to find a way forward to provide good jobs for people,” he said.
“Enhanced oil recovery can play some role, but I doubt if it’s going to be very big.”
If oil can actually be entirely net neutral or net negative from its production all the way to its end use, such as powering a vehicle, that would truly be fantastic, said Keith, but “whether or not those companies are doing it, I don’t know. The devil is really in the details.”
Both companies see a strong future for carbon capture and EOR technologies, especially as demand for oil remains robust around the globe.
“The world should be looking for the cheapest, lowest-carbon source of energy, and we believe we compete very well with that,” said Jabusch, with Enhance.
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