China Energy IPO: MIE Holdings

| About: Mie Holdings (MIE)

MIE Holdings (MIE), one of the largest independent oil companies in China, is expected to go public this week.

All excerpts are from the company's most recent F-1 filing.

Business Overview (from prospectus)

We are one of the largest independent upstream oil companies operating onshore in China as measured by net proved reserves. We operate the Daan, Moliqing and Miao 3 oilfields in the Songliao Basin, China’s most prolific oil-producing basin, under three separate production sharing contracts with PetroChina, the largest oil company in China. In addition, we pursue other exploration, development and production opportunities in China and internationally both independently and in partnership with other major and independent oil companies.

Offering: 18 million shares at $12-$14 per share. Net proceeds of approximately $133.2 million will be used to drill new wells in existing oilfields, to expand operations by acquiring interests in other oilfields, and for working capital and general corporate purposes.

Lead Underwriters: BofA Merrill Lynch (NYSE:BAC), J.P. Morgan (NYSE:JPM), Macquarie Securities

Financial Highlights:

Our revenue decreased by RMB804.9 million, or 40.8%, from RMB1,971.7 million for the year ended December 31, 2008 to RMB1,166.8 million ($170.9 million) for the year ended December 31, 2009... Our operating expenses decreased by RMB264.5 million, or 22.2%, from RMB1,190.1 million for the year ended December 31, 2008 to RMB925.6 million ($135.6 million) for the year ended December 31, 2009... Our profit from operations decreased by RMB540.4 million, or 69.1%, from RMB781.6 million for the year ended December 31, 2008 to RMB241.2 million ($35.3 million) for the year ended December 31, 2009

Competitors:

We are the sole operator of the three oilfields at Daan, Moliqing and Miao 3 through contractual arrangements with PetroChina (NYSE:PTR). We do not compete with other operators in our contract areas. However, we encounter competition when we seek to acquire new properties, secure additional production sharing contracts with state-owned oil and gas companies or hire trained personnel. We may face competition from both existing players and new emerging players for the contractual right to cooperate with PetroChina and Sinopec (NYSE:SHI), which are the only entities permitted to cooperate with foreign companies in onshore crude oil and natural gas exploration and production in the PRC, and for the development and production of oil resources in the PRC. Some of the competitors include ROC Oil, Central Asia Oil, Bright Oceans and Ivanhoe Energy. Factors that could affect our competitiveness may include, among others, technical capability, financial resources, experience and track record, and our relationship with PetroChina and Sinopec.

Additional Resources:

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