The equipment industry is the backbone of the manufacturing industry, with energy equipment lying at its very core. As an emerging financial power close to the real economy and focusing on the industrial and ecological chains, the industry effectively allocates more resources to key areas and weak links in the development of energy equipment. It is an important practice that the financial leasing industry insists on the goal of financial power, while always improving quality and serving the real economy.

JIC Leasing Shanghai is familiar with the political and personal nature of financial work, and strives to serve the demands of the country. By combining the oil and gas equipment requirements of the relevant central enterprises, JIC Leasing makes full use of the strengths and advantages of “financing+leasing assets”, actively providing diversified and innovative leasing products and solutions to its customers, thus promoting the development of the “Pillars of a Great Power” in the field of oil and gas through financial energy.

“Sharp Tools Make Good Work”

Energy is both the foundation and the driving force of economic and social development. With Comrade Xi Jinping at the core, the CPC Central Committee has repeatedly made active arrangements for protecting the national energy security, and proposed that “Our energy rice bowl must be held in our own hands”. This is both a profound summary of historical experience, and a profound insight into focusing on reality. In this way, financing will play an important role in ensuring the national energy security, as well as the smooth operation of the industrial chain. Oil and gas equipment is not only an important means and material basis for ensuring and stabilizing the production of key natural resources, but is also a key area in developing new quality productivity. The development of the O&G equipment industry is directly related to national energy security and safety, covering all aspects of the national economy and people’s livelihoods.

Led by the new energy security strategy, the national “14th Five-Year Plan” for Modern Energy Systems (hereinafter referred to as the “Plan”) makes it clear that by 2025, the total annual energy production capacity for domestic energy will exceed 4.6 billion metric tons of standard coal, while the proportion of non-fossil energy consumption will increase to about 20%. The Plan particularly emphasizes the growth in oil and gas supply capacity by enhancing domestic oil and gas exploration. This will include both regular and specific applications, as well as onshore and offshore development, actively expanding the exploration of unconventional resources and accelerating the development of shale oil, shale gas, and coal-bed methane. The oil enterprises represented by the three major state-owned oil companies will steadfastly implement the “Seven-year Action Plan” for increasing reserves and production in the oil and gas industry. Both strong demand for exploration and a high level of capital expenditure will drive the development of the entire oil and gas industry chain, as part of which the equipment industry will usher in a new phase of steady development and growth, providing a stable underlying market space for associated equipment leasing.

Data source: Zhiyanzhan Industrial Research Institute

With China now attaching great importance to energy security and domestic oil and gas consumption, continuous and stable growth is being assured. JIC Leasing Shanghai looks upon energy equipment leasing as an important part of this transformation, and set up a special group for energy equipment in 2021. The goal of this working group is to closely serve the needs of all relevant central enterprises for oil and gas development, contributing to the high-quality development of the industry and providing leasing services for China to enhance its ability to supply and guarantee strategic resources, while safeguarding the nation’s energy security.

Strengthening the “Crack Troops” and “Sharp Weapons” that Ensure National Energy Security through Leasing Power

On January 3, 2024, a drilling well operated by the PetroChina Southwest Oil & Gasfield Company reached 1.619 km (more than one mile) per day, marking the first time that China’s horizontal shale gas wells have reached this new benchmark. The world’s most advanced high-temperature rotary guidance equipment used as part of this drilling project was provided to the customer by JIC Leasing Shanghai on an operating lease basis. The customer’s original rotary guidance tools were unable to meet production requirements, leading to possible project interruptions. JIC Leasing prioritized the urgent needs of the customer, and deployed its crack team of “party member commandos”, consisting of front, middle and back office members, with the goal of solving the “first difficulty” in promoting the business. This included imported equipment procurement and circulation, as well as currency settlement. By developing various strategies, thinking about countermeasures, and adjusting resources, JIC Leasing Shanghai was able to open up the logistics, capital flow, and bill flow using an equipment import model, thus delivering equipment to the customer in time.

Due to complex geological conditions in China’s Xinjiang, Qinghai and Sichuan regions, oil and gas exploration and development can be very difficult, with significant restrictions posed by the environment, which in turn raise higher requirements for equipment adaptability. JIC Leasing continuously optimizes its leasing products and service offering, responding to the needs of target customers and key equipment procurement plans. The company has purchased a range of high-end equipment with a total value of 1.5 billion yuan, and provided these to customers through operational leasing, in order to solve circulation and sales problems and meet the downstream drilling company’s demands for equipment usage. In this way, JIC Leasing is supporting the increased production and efficiency enhancement of China’s shale oil and gas exploration activities.

JIC Leasing has now formed a customized service structure for oil and gas equipment leasing, with professional service capabilities and project operations experience, which can help customers effectively solve the contradiction between the internal limitations of equipment investment and financing, and the continuous growth of their business objectives. The company always focuses on risk control first, and has formulated a set of “Risk Guidelines for the Oil and Gas Equipment Business” to promote the healthy and standardized development of the business.

Continuously Injecting“Power and Source”for the High-quality Development of the Oil and Gas Equipment Industry

The report of the 20th CPC National Congress defined “basically achieving new industrialization” as one of the overall goals of China’s development by 2035, and proposed to “implement industrial foundation reconstruction projects and major technology and equipment research projects, support the development of enterprises that use sophisticated technologies to produce novel and unique products, and promote the manufacturing industry to develop towards high end, intelligent and green technology”. A new round of large-scale equipment renewal has been launched to bring new space for equipment manufacturing enterprises to expand their advanced production capacity. As the existing equipment gradually enters the stage of aging and updating, low carbon initiatives, combined with lower cost and higher efficiency goals to promote the structural optimization and upgrading of oil and gas equipment, will provide a greater opportunity for the subsequent expansion of the leasing market. Procurement demands for key equipment and spare parts of central energy enterprises will place new demands on reducing the procurement cycle, while new and updated requirements will be brought about by advancements in fracking technology.

In the future, by adhering to the political and personal nature of financial work, seeking improvement in stability, and remaining both prudent and steadfast, JIC Leasing Shanghai will actively explore cooperation opportunities in various links of the oil and gas industry chain, continuously expand service scenarios and customer coverage of associated equipment, and accelerate the application of “first” equipment while breaking through technical “bottlenecks”. In this way, the company will promote the “increased knowledge and green development” of the oil and gas industry, and serve the high-quality development of the Chinese nation.