IEA: OPEC+ puts floor beneath oil.
Friday, December 14, 2018
IEA: OPEC+ puts floor beneath oil. The OPEC+ deal put “a floor” beneath oil prices, according to the IEA’s latest Oil Market Report. The agency said that non-OPEC supply could still outgrow demand next year, expanding by 1.5 mb/d while demand may only soak up 1.4 mb/d of that additional supply. As such, OPEC+ might be forced to maintain the cuts through the end of the year. However, there are plenty of uncertainties, including the extent of losses from Iran and Venezuela, while additional outages could come from Libya or elsewhere. For now, the IEA says the production cut deal will keep prices from falling further, but it is still too early to tell if the agreement will significantly boost prices.
EIA: U.S. to average 12.1 mb/d in 2019. The EIA said in its latest Short-Term Energy Outlook that the U.S. should average 12.1 mb/d in 2019, up sharply from a 10.9 mb/d average this year. Notably, the production estimate is mostly unchanged from previous months, even though oil prices have crashed. The EIA even lowered its expected price for Brent and WTI in 2019 by roughly $10 per barrel, but the agency clearly thinks that the production gains are mostly baked in already.
Signs of demand slowdown in Asia. Refining figures in Asia suggest demand could be slowing down in the region, Bloomberg reports. Asian refining margins are at an eight-month low, which could be a leading indicator of slowing consumption.
OECD stocks above average. OECD stocks rose above the five-year average in October (the latest month for which data is available) for the first time since March.
Neutral Zone could reopen. Saudi Arabia and Kuwait are nearing a deal to restart idled oil fields in disputed territory along their shared border. The so-called Neutral Zone oil fields have the capacity to produce 500,000 bpd, but have been offline for several years. The U.S. government has leaned on both countries to resolve their differences, with an eye on shrinking supply from Iran. Chevron (NYSE: CVX), which jointly operates one of the fields in Kuwait, said it maintains “readiness for a production restart when that time comes,” according to the Wall Street Journal.
Premier Oil Plc could bid for North Sea assets. Premier Oil plc (LON: PMO) is considering a $2 billion bid for a group of North Sea oil and gas assets from Chevron (NYSE: CVX).
Nigeria files $1.1 billion claim against Shell. Nigeria has filed a $1.1 billion legal claim against Royal Dutch Shell (NYSE: RDS.A) and Eni (NYSE: E) over a highly controversial 2011 oil license, the same license that has also ensnared Eni’s top brass in corruption inquiries in Italy. Nigeria filed a claim in a London court, alleging that the two oil companies, among others, “participated in a fraudulent and corrupt scheme,” according to the FT.
Barclays: Brent at $72 in 2019. Barclays expects Brent to rise to $71 per barrel as early as the first quarter of 2019, which is much more optimistic than a raft of other forecasts that have come out lately. For the full year, Barclays sees Brent averaging $72 and WTI averaging $65. “Brent and WTI prices are poised to rebound in 1H19,” Barclays said in a note. “The inventory situation is far better than the last time cuts started in early 2017, and the cuts have already begun, as shown in December data.”
China stocked up on oil when prices fell. In at least two key regions in China, oil imports jumped by 26 percent in November compared to the average level from the prior ten months, according to Bloomberg. The rise in imports suggests China was stocking up on crude, taking advantage of low prices.
Famed hedge fund manager says U.S. shale makes oil harder to predict. Andy Hall, a well-known hedge fund manager nicknamed “God” for the huge sums he has made on oil trading, said that U.S. shale has made the oil market much harder to predict. The short-cycle nature of shale, which stops and starts much quicker in response to price swings than conventional production, makes it harder to get ahead of the booms and busts. “It used to be, on the supply side of the equation, you could predict with some confidence what future supply was going to be, outside of global political events,” Hall told Bloomberg. Now, “everyone is groping. There are a lot of variables that we don’t have a good handle on.”
U.S. Senate votes to end war in Yemen. The U.S. Senate passed a bill to end American support for the war in Yemen, against the advice of Secretary of Defense Jim Mattis and President Trump. The Senate also censured Saudi crown prince Mohammed bin Salman and blamed him for the murder of slain journalist Jamal Khashoggi. The bill will have no practical effect since the U.S. House of Representatives declined to move companion legislation earlier this week. But the issue is not over and with Democrats taking over control of the House in the New Year, the legislation could be revived.
Saudi Arabia aims to cut oil shipments to United States. In an effort to drain the surplus of oil stocks, Saudi Arabia plans on curtailing shipments specifically to the U.S., according to Bloomberg, a strategy intended to shift market psychology. Because the U.S. is one of the few countries that offers regular and transparent data on oil inventories, cutting down on stocks in the U.S. will transform how investors view the global market. Visible declines in inventories, which the EIA will report week after week, should bolster market confidence. It’s a strategy the Saudis used back in 2017 when it tried to boost prices.
IEA: OPEC+ puts floor beneath oil. The OPEC+ deal put “a floor” beneath oil prices, according to the IEA’s latest Oil Market Report. The agency said that non-OPEC supply could still outgrow demand next year, expanding by 1.5 mb/d while demand may only soak up 1.4 mb/d of that additional supply. As such, OPEC+ might be forced to maintain the cuts through the end of the year. However, there are plenty of uncertainties, including the extent of losses from Iran and Venezuela, while additional outages could come from Libya or elsewhere. For now, the IEA says the production cut deal will keep prices from falling further, but it is still too early to tell if the agreement will significantly boost prices.
EIA: U.S. to average 12.1 mb/d in 2019. The EIA said in its latest Short-Term Energy Outlook that the U.S. should average 12.1 mb/d in 2019, up sharply from a 10.9 mb/d average this year. Notably, the production estimate is mostly unchanged from previous months, even though oil prices have crashed. The EIA even lowered its expected price for Brent and WTI in 2019 by roughly $10 per barrel, but the agency clearly thinks that the production gains are mostly baked in already.
Signs of demand slowdown in Asia. Refining figures in Asia suggest demand could be slowing down in the region, Bloomberg reports. Asian refining margins are at an eight-month low, which could be a leading indicator of slowing consumption.
OECD stocks above average. OECD stocks rose above the five-year average in October (the latest month for which data is available) for the first time since March.
Neutral Zone could reopen. Saudi Arabia and Kuwait are nearing a deal to restart idled oil fields in disputed territory along their shared border. The so-called Neutral Zone oil fields have the capacity to produce 500,000 bpd, but have been offline for several years. The U.S. government has leaned on both countries to resolve their differences, with an eye on shrinking supply from Iran. Chevron (NYSE: CVX), which jointly operates one of the fields in Kuwait, said it maintains “readiness for a production restart when that time comes,” according to the Wall Street Journal.
Premier Oil Plc could bid for North Sea assets. Premier Oil plc (LON: PMO) is considering a $2 billion bid for a group of North Sea oil and gas assets from Chevron (NYSE: CVX).
Nigeria files $1.1 billion claim against Shell. Nigeria has filed a $1.1 billion legal claim against Royal Dutch Shell (NYSE: RDS.A) and Eni (NYSE: E) over a highly controversial 2011 oil license, the same license that has also ensnared Eni’s top brass in corruption inquiries in Italy. Nigeria filed a claim in a London court, alleging that the two oil companies, among others, “participated in a fraudulent and corrupt scheme,” according to the FT.
Barclays: Brent at $72 in 2019. Barclays expects Brent to rise to $71 per barrel as early as the first quarter of 2019, which is much more optimistic than a raft of other forecasts that have come out lately. For the full year, Barclays sees Brent averaging $72 and WTI averaging $65. “Brent and WTI prices are poised to rebound in 1H19,” Barclays said in a note. “The inventory situation is far better than the last time cuts started in early 2017, and the cuts have already begun, as shown in December data.”
China stocked up on oil when prices fell. In at least two key regions in China, oil imports jumped by 26 percent in November compared to the average level from the prior ten months, according to Bloomberg. The rise in imports suggests China was stocking up on crude, taking advantage of low prices.
Famed hedge fund manager says U.S. shale makes oil harder to predict. Andy Hall, a well-known hedge fund manager nicknamed “God” for the huge sums he has made on oil trading, said that U.S. shale has made the oil market much harder to predict. The short-cycle nature of shale, which stops and starts much quicker in response to price swings than conventional production, makes it harder to get ahead of the booms and busts. “It used to be, on the supply side of the equation, you could predict with some confidence what future supply was going to be, outside of global political events,” Hall told Bloomberg. Now, “everyone is groping. There are a lot of variables that we don’t have a good handle on.”
U.S. Senate votes to end war in Yemen. The U.S. Senate passed a bill to end American support for the war in Yemen, against the advice of Secretary of Defense Jim Mattis and President Trump. The Senate also censured Saudi crown prince Mohammed bin Salman and blamed him for the murder of slain journalist Jamal Khashoggi. The bill will have no practical effect since the U.S. House of Representatives declined to move companion legislation earlier this week. But the issue is not over and with Democrats taking over control of the House in the New Year, the legislation could be revived.
Saudi Arabia aims to cut oil shipments to United States. In an effort to drain the surplus of oil stocks, Saudi Arabia plans on curtailing shipments specifically to the U.S., according to Bloomberg, a strategy intended to shift market psychology. Because the U.S. is one of the few countries that offers regular and transparent data on oil inventories, cutting down on stocks in the U.S. will transform how investors view the global market. Visible declines in inventories, which the EIA will report week after week, should bolster market confidence. It’s a strategy the Saudis used back in 2017 when it tried to boost prices.
Volf
15.12.2018 kl 09:57
902
Global Intelligence Report - 14th December 2018
Sources
- Kazakhstan energy industry executives
- Western hedge fund manager
- A source in the Kazakh political elite inner circle
- A prominent UAE banker
- Libyan investigative journalist in Tripoli
The Oil Cartel Game & Deeper Concerns for MBS
As we noted last week, Qatar’s move to quit OPEC was intended to weaken the cartel. The timing is perfect for Washigton—just as the US is pumping over 11 million bdp, and counting.
Beyond this, Qatar is keen to be out from under any threats posed to its US LNG ambitions because of NOPEC, which could have potentially led to antitrust lawsuits that would risk Qatar’s planned billions of investment in the US.
In the meantime, there is real concern—for the first time—that not only the Khashoggi murder, but also the Mueller probes in DC could significantly undermine Saudi Arabia’s (and the GCC masters’) position in the United States. There are indications now of illegal Gulf involvement in the Trump campaign, and if the Saudis or UAE are found (with evidence, such as large amounts of cash given by figures in Abu Dhabi to Nader) to have subverted the US or interfered with the presidency this could all be pushed over the edge. A key concern will be MBS’ response to this decided cooling of relations, the unpredictable nature of which is the most dangerous aspect.
Investors, Look to Kazakhstan
In mid-November, Kazaatomprom (KAP)—Kazakhstan’s state-owned uranium producer (the Saudi Arabia of uranium)—became the first big Kazakh IPO in over a decade, listing on the new Astana International Financial Center’s (AIFC) stock exchange. Then, in late October, KazMunaiGas (KMG) finalized its own plans for a $6.5-billion IPO. That would value the gas giant at up to $26 billion. The plan is to sell 20-25% of shares.
KazMunaiGas is Kazakhstan’s state-run company for exploration, production, refining and transportation of oil and gas, and it’s owned by the country’s sovereign wealth fund, Samruk-Kazyna. The company is vertically integration and the grouping of companies has some 200 entities.
What investors need to know is this: Right now, KMG is a state-run commercial entity that is trying to step up its ability to compete with international rivals and it’s taken great strides to improve transparency to that end (enough so, that’s it feels ready for an IPO). The country’s long time President Nazarbayev, has been working toward this end for several years, largely because his time is running out and he wishes to leave behind a very specific legacy. KMG, though, is subject to the direct influence of Nazarbayev in terms of strategic decision-making (not day-to-day decision-making). More than half of the energy elite in Kazakhstan are patrons of Nazarbayev, and the oil and gas industry is what has been funding the network of patronage, with major rewards for loyalty. Now, however, the game is all about attracting foreign investors, and that means increased transparency. KMG itself has been dogged by everything from tax discrepancies to embezzlement—each time in recent years anything like this has come up, senior managers involved have been removed and prosecuted and the company has been fined.
The biggest concern for investors with the new KMG 2.0 is the potential for entanglement with sanctions violations, both concerning Russia and Iran. KMG has strategic relations with Gazprom, and we see these ties intensifying in the coming months. That includes a JV between Gazprom and KMG, KazRosGas, which was negotiated directly between Putin and Nazarbayev. This JV controls gas flows from Central Asia through Russia to Germany and Switzerland. While there is less concern regarding Iran, investors should be aware that KMG has in the past been interested in pursuing oil swap deals with Iran, and relations strengthened in 2016 when sanctions were lifted, with the current strategy being an attempt to figure out how to circumvent the sanctions regime.
Despite the fact that KMG and its 200 companies are controlled by the government, though strides have been taken to increase transparency, and despite concerns about sanctions violations tie-ups, we have strong indications that Western investors are interested in KMG.
Libyan Oil Hijacked Again
Libya’s Sharara oilfield has been under siege since 8 December, forcing the National Oil Company (NOC) to declare force majeure on exports. This is a joint venture between Spain’s Repsol, French Total SA, Austrian OMV, Norway’s Statoil and the Libyan NOC. That takes 315,000 bpd offline, and drops Libyan output to around 685,000 bpd. While Western media portrays this as an armed militia seizure of the oilfield, in truth it has been a bit more complicated than that. The oilfield was nominally taken over by protesters in the south trying to force their demands on an inactive, dysfunctional and split government. But those protesters, in the form of the Fezzan Rage Movement, invited the local Petroleum Facilities Guard (PFG) militia in on this, and now the occupation is a dangerous cocktail of PFG militia, armed tribesmen and civilian workers. They all have different agendas, and the PFG is holding out for a cash ransom, and there is disagreement among the various parties involved. In an apparent attempt to end that internal disagreement, the PFG has also added a demand for more workers at the facility to appease one camp of occupiers. The NOC has said in no uncertain terms that it’s not going to be paying a cash ransom.
On Thursday, Germany pledged another 2.5 million euros to the Stabilization Facility for Libya (SFL). But that pledge came right before it was confirmed that the Islamic State had killed six of 10 hostages taken during an October attack on the town of Al-Foqua.
In the meantime, there appears to be another interesting rival to General Khalifa. The powerful head of the Tripoli Revolutionaries Brigade (TRB), Haithem Tajouri, is back in town after having exiled himself apparently to the UAE for a spell. He’s flashing some serious cash around Tripoli, and is dressed in a way that spells UAE support, which is also supporting Haftar. It is unclear how this potential rivalry (or alliance) might play out.
Moscow Muscle in Venezuela
From a geopolitical standpoint, there should be significant cause for concern at the opening Putin has seen in a Venezuela sanctioned by the US. In the American backyard, Putin is openly supporting Venezuelan President Maduro and has taken things a step further by deploying nuclear-capable bombers to the Latin American country for military exercises. The lines are being drawn in the sand here.
Global Oil & Gas Playbook
Australia has become the biggest global exporter of LNG overtaking Qatar by shipping 6.5 million tons of the superchilled fuel abroad in November. To compare, Qatar’s export shipments came in at about 6.2 million tons during the month.
This is yet another seismic shift in global energy after the United States emerged as the biggest crude oil producer globally this year, overtaking Saudi Arabia and Russia. Australia staked its claim as leader of the global LNG industry earlier this decade, with total investments in this strategy coming in at about $200 billion so far.
The country now boasts several of the largest LNG projects in the world, including Chevron’s Gorgon and Wheatstone, Inpex’s Ichthys, which started producing earlier this year, and Shell’s Prelude, due to come online before this year’s end. The total LNG production capacity of all existing projects is about 88 million tons annually.
However, the sharp increase in LNG exports has squeezed domestic supply in some parts of the country. Last year, gas prices on the eastern coast of the country spiked because most of the gas produced locally was shipped abroad, so the government had to step in and impose restrictions. Now, Western Australia is threatened by a gas shortage in the medium term, again because of rising exports.
Qatar is also eyeing an increase in production capacity from 77 million tons annually to 110 million tons annually by 2024, which might help it regain the top spot. However, LNG demand projections for the next decade or so are so robust, there will likely be enough buyers for all the LNG coming out of Australia and Qatar, whoever comes on top as the world’s biggest supplier.
Deals, Mergers & Acquisitions
- Italy’s Eni sold a 25% stake in the Nour North Sinai Offshore concession in Egypt to supermajor BP and another 20% to Mubadala Petroleum. Following the deal, which got the approval of the Egyptian government, Eni will remain the biggest shareholder in the concession with 40%. The deals are part of an expansion of Eni’s international partnership with BP on various projects. The Italian company is currently drilling its first exploration well in the Nour North Sinai Offshore block.
- A Chinese state energy firm has bought a 4% stake in an onshore oil and gas concession in Abu Dhabi, as part of the latter’s strategy of expanding the participation of foreign companies in its fields to boost production. The buyer is China ZhenHua Oil, a company wholly owned by a Chinese government agency. The stake was previously owned by another Chinese company—CEFC China—which ran into financial problems earlier this year after a breakneck international expansion that eventually worried Beijing and prompted an investigation into the company’s finances.
Tenders, Auctions & Contracts
- French Total expanded its presence in Mauritania after it won the rights to develop two more blocks off the coast of the western African country. The French company will lead the exploration of the deepwater blocks with a 90% stake in them, with the Mauritanian state energy company holding the rest. Total has been present in Mauritania for 20 years and considers the tiny coastal state one of its most promising locations in Africa.
- Brazil’s government and Petrobras s
Sources
- Kazakhstan energy industry executives
- Western hedge fund manager
- A source in the Kazakh political elite inner circle
- A prominent UAE banker
- Libyan investigative journalist in Tripoli
The Oil Cartel Game & Deeper Concerns for MBS
As we noted last week, Qatar’s move to quit OPEC was intended to weaken the cartel. The timing is perfect for Washigton—just as the US is pumping over 11 million bdp, and counting.
Beyond this, Qatar is keen to be out from under any threats posed to its US LNG ambitions because of NOPEC, which could have potentially led to antitrust lawsuits that would risk Qatar’s planned billions of investment in the US.
In the meantime, there is real concern—for the first time—that not only the Khashoggi murder, but also the Mueller probes in DC could significantly undermine Saudi Arabia’s (and the GCC masters’) position in the United States. There are indications now of illegal Gulf involvement in the Trump campaign, and if the Saudis or UAE are found (with evidence, such as large amounts of cash given by figures in Abu Dhabi to Nader) to have subverted the US or interfered with the presidency this could all be pushed over the edge. A key concern will be MBS’ response to this decided cooling of relations, the unpredictable nature of which is the most dangerous aspect.
Investors, Look to Kazakhstan
In mid-November, Kazaatomprom (KAP)—Kazakhstan’s state-owned uranium producer (the Saudi Arabia of uranium)—became the first big Kazakh IPO in over a decade, listing on the new Astana International Financial Center’s (AIFC) stock exchange. Then, in late October, KazMunaiGas (KMG) finalized its own plans for a $6.5-billion IPO. That would value the gas giant at up to $26 billion. The plan is to sell 20-25% of shares.
KazMunaiGas is Kazakhstan’s state-run company for exploration, production, refining and transportation of oil and gas, and it’s owned by the country’s sovereign wealth fund, Samruk-Kazyna. The company is vertically integration and the grouping of companies has some 200 entities.
What investors need to know is this: Right now, KMG is a state-run commercial entity that is trying to step up its ability to compete with international rivals and it’s taken great strides to improve transparency to that end (enough so, that’s it feels ready for an IPO). The country’s long time President Nazarbayev, has been working toward this end for several years, largely because his time is running out and he wishes to leave behind a very specific legacy. KMG, though, is subject to the direct influence of Nazarbayev in terms of strategic decision-making (not day-to-day decision-making). More than half of the energy elite in Kazakhstan are patrons of Nazarbayev, and the oil and gas industry is what has been funding the network of patronage, with major rewards for loyalty. Now, however, the game is all about attracting foreign investors, and that means increased transparency. KMG itself has been dogged by everything from tax discrepancies to embezzlement—each time in recent years anything like this has come up, senior managers involved have been removed and prosecuted and the company has been fined.
The biggest concern for investors with the new KMG 2.0 is the potential for entanglement with sanctions violations, both concerning Russia and Iran. KMG has strategic relations with Gazprom, and we see these ties intensifying in the coming months. That includes a JV between Gazprom and KMG, KazRosGas, which was negotiated directly between Putin and Nazarbayev. This JV controls gas flows from Central Asia through Russia to Germany and Switzerland. While there is less concern regarding Iran, investors should be aware that KMG has in the past been interested in pursuing oil swap deals with Iran, and relations strengthened in 2016 when sanctions were lifted, with the current strategy being an attempt to figure out how to circumvent the sanctions regime.
Despite the fact that KMG and its 200 companies are controlled by the government, though strides have been taken to increase transparency, and despite concerns about sanctions violations tie-ups, we have strong indications that Western investors are interested in KMG.
Libyan Oil Hijacked Again
Libya’s Sharara oilfield has been under siege since 8 December, forcing the National Oil Company (NOC) to declare force majeure on exports. This is a joint venture between Spain’s Repsol, French Total SA, Austrian OMV, Norway’s Statoil and the Libyan NOC. That takes 315,000 bpd offline, and drops Libyan output to around 685,000 bpd. While Western media portrays this as an armed militia seizure of the oilfield, in truth it has been a bit more complicated than that. The oilfield was nominally taken over by protesters in the south trying to force their demands on an inactive, dysfunctional and split government. But those protesters, in the form of the Fezzan Rage Movement, invited the local Petroleum Facilities Guard (PFG) militia in on this, and now the occupation is a dangerous cocktail of PFG militia, armed tribesmen and civilian workers. They all have different agendas, and the PFG is holding out for a cash ransom, and there is disagreement among the various parties involved. In an apparent attempt to end that internal disagreement, the PFG has also added a demand for more workers at the facility to appease one camp of occupiers. The NOC has said in no uncertain terms that it’s not going to be paying a cash ransom.
On Thursday, Germany pledged another 2.5 million euros to the Stabilization Facility for Libya (SFL). But that pledge came right before it was confirmed that the Islamic State had killed six of 10 hostages taken during an October attack on the town of Al-Foqua.
In the meantime, there appears to be another interesting rival to General Khalifa. The powerful head of the Tripoli Revolutionaries Brigade (TRB), Haithem Tajouri, is back in town after having exiled himself apparently to the UAE for a spell. He’s flashing some serious cash around Tripoli, and is dressed in a way that spells UAE support, which is also supporting Haftar. It is unclear how this potential rivalry (or alliance) might play out.
Moscow Muscle in Venezuela
From a geopolitical standpoint, there should be significant cause for concern at the opening Putin has seen in a Venezuela sanctioned by the US. In the American backyard, Putin is openly supporting Venezuelan President Maduro and has taken things a step further by deploying nuclear-capable bombers to the Latin American country for military exercises. The lines are being drawn in the sand here.
Global Oil & Gas Playbook
Australia has become the biggest global exporter of LNG overtaking Qatar by shipping 6.5 million tons of the superchilled fuel abroad in November. To compare, Qatar’s export shipments came in at about 6.2 million tons during the month.
This is yet another seismic shift in global energy after the United States emerged as the biggest crude oil producer globally this year, overtaking Saudi Arabia and Russia. Australia staked its claim as leader of the global LNG industry earlier this decade, with total investments in this strategy coming in at about $200 billion so far.
The country now boasts several of the largest LNG projects in the world, including Chevron’s Gorgon and Wheatstone, Inpex’s Ichthys, which started producing earlier this year, and Shell’s Prelude, due to come online before this year’s end. The total LNG production capacity of all existing projects is about 88 million tons annually.
However, the sharp increase in LNG exports has squeezed domestic supply in some parts of the country. Last year, gas prices on the eastern coast of the country spiked because most of the gas produced locally was shipped abroad, so the government had to step in and impose restrictions. Now, Western Australia is threatened by a gas shortage in the medium term, again because of rising exports.
Qatar is also eyeing an increase in production capacity from 77 million tons annually to 110 million tons annually by 2024, which might help it regain the top spot. However, LNG demand projections for the next decade or so are so robust, there will likely be enough buyers for all the LNG coming out of Australia and Qatar, whoever comes on top as the world’s biggest supplier.
Deals, Mergers & Acquisitions
- Italy’s Eni sold a 25% stake in the Nour North Sinai Offshore concession in Egypt to supermajor BP and another 20% to Mubadala Petroleum. Following the deal, which got the approval of the Egyptian government, Eni will remain the biggest shareholder in the concession with 40%. The deals are part of an expansion of Eni’s international partnership with BP on various projects. The Italian company is currently drilling its first exploration well in the Nour North Sinai Offshore block.
- A Chinese state energy firm has bought a 4% stake in an onshore oil and gas concession in Abu Dhabi, as part of the latter’s strategy of expanding the participation of foreign companies in its fields to boost production. The buyer is China ZhenHua Oil, a company wholly owned by a Chinese government agency. The stake was previously owned by another Chinese company—CEFC China—which ran into financial problems earlier this year after a breakneck international expansion that eventually worried Beijing and prompted an investigation into the company’s finances.
Tenders, Auctions & Contracts
- French Total expanded its presence in Mauritania after it won the rights to develop two more blocks off the coast of the western African country. The French company will lead the exploration of the deepwater blocks with a 90% stake in them, with the Mauritanian state energy company holding the rest. Total has been present in Mauritania for 20 years and considers the tiny coastal state one of its most promising locations in Africa.
- Brazil’s government and Petrobras s