Fri, Jul. 24, 10:30 AM
- Italian oil contractor Saipem (OTCPK:SAPMY) is working with Bain & Co. to devise a restructuring plan to help it cut costs and counter falling oil prices that have sapped its order book and stretched its balance sheet, Reuters reports.
- Saipem, 43% owned by state-controlled Eni (E -0.8%), has lost ~75% of its value in the last two-and-a-half years after a corruption probe in Algeria, two profit warnings and the cancellation of a Black Sea pipeline contract.
- A source also tells Reuters the restructuring plan is necessary ahead of a planned capital raising effort that could happen before the end of the year.
Thu, Jul. 23, 12:31 PM
- Eni (E +0.5%) is considering selling all or part of its onshore Nigerian operations as it seeks to divest non-core businesses amid a drop in oil prices, Bloomberg reports.
- Eni is said to have asked advisers to look at options for the assets, which include interests in oil and natural gas fields; depending on what Eni would decide to sell, a deal could raise $2B-$5B.
- Eni’s wholly owned subsidiary in the country operates under a joint venture agreement with Nigeria’s state oil company NNPC and ConocoPhillips (COP -2.5%).
Tue, Jul. 21, 9:56 AM
- Eni (NYSE:E) has discovered gas reserves of up to 15B cm in Egypt's Nile Delta region, with production set to start in two months, the country's oil ministry said yesterday.
- The discovery occurred in the Nooros exploration prospect in the Abu Madi West license area, ~75 miles northeast of Alexandria, where Eni holds 75% of exploration rights through an Egyptian subsidiary and BP holds a 25% stake.
- Eni is one of the main energy producers in Egypt, with output of ~180K boe/day.
Thu, Jul. 16, 2:46 PM
- Iran can restore production to 1970s levels of 6M bbl/day by 2020, as the country's plentiful and inexpensive reserves draw in foreign oil explorers, former Eni (E +0.5%) CEO Paolo Scaroni says.
- The flood of Iranian oil into a global market that’s already oversupplied will keep crude prices low for the rest of the decade, Scaroni says.
- The risk of sanctions being re-imposed on Iran if it violates the terms of the nuclear deal will lead companies to focus on renovating and restoring output at existing fields rather than investing in new projects, he adds.
- Eni worked under Scaroni’s management on several oil and gas fields in Iran before beginning to pull out in 2010 amid sanctions, and was among a handful of oil company chiefs who met with Iran's oil minister late in 2013; Eni, BP and Shell (RDS.A, RDS.B) are among companies that are considered well positioned to take advantage if restrictions are lifted.
Wed, Jul. 15, 11:57 AM
- European energy majors BP, Royal Dutch Shell (RDS.A, RDS.B) and Total (NYSE:TOT) are likely to be among the first beneficiaries of the Iran nuclear deal and the anticipated removal of sanctions, while U.S. energy companies face being left in the cold.
- TOT could see Iran allowing it to resume construction of a 2B cf/day liquefied natural gas export facility; Shell says it has "done business in Iran before and will be interested in looking at new possibilities when sanctions are lifted."
- Italy's Eni (NYSE:E) also says it would consider investing in Iran again if sanctions are lifted and Iran improves its contract terms.
- A few avenues for U.S. companies may be open: U.S. firms will now be allowed to sell or lease commercial passenger aircraft to Iran as long as they procure licenses from the U.S. government, giving companies such as Boeing (NYSE:BA) an opportunity.
- Still, Iran has the reputation of a difficult place for outsiders to do business, ranking 130th on the World Bank’s ease-of-doing business list amid encounters with bureaucracy, episodic corruption and political interference.
Fri, Jul. 10, 8:19 AM
- A dozen workers have been killed and others injured after an explosion ripped through an Eni-connected (NYSE:E) pipeline in Nigeria.
- The blast occurred on a section of the onshore Tebidaba-Clough Creek line in the Niger Delta late Thursday.
- Eni says it is investigating the cause of the blast but that the pipeline had been previously damaged by acts of sabotage.
Thu, Jul. 9, 7:21 PM
- Bloomberg's Carl Pope makes the case that the largest publicly traded oil companies face a problem that will only grow worse with time: Dependence on ever higher oil prices to match their ever higher costs of discovery.
- Pope notes that publicly traded oil and gas companies have access to only 10% of the world’s oil reserves, and those reserves increasingly are located in areas that are among the most difficult and expensive to extract; meanwhile, more accessible, inexpensive crude reserves in places like Russia and the Persian Gulf are set aside by governments for their own national oil companies.
- The columnist notes that the percentage of Exxon’s (NYSE:XOM) proven reserves made up of tar sands and heavy oil increased from 15% in 2006 to 32% by 2013, and relying on a larger share of more expensive oil has worn on XOM's margins and returns.
- Other relevant tickers: CVX, COP, BP, RDS.A, RDS.B, TOT, E
- ETFs: XOP, IEO, PXE, NDP, GUSH, DRIP
Thu, Jul. 9, 9:58 AM
- Italian oil field contractor Saipem (OTCPK:SAPMY) says Gazprom (OTCPK:OGZPY) has canceled a contract to build the South Stream natural gas pipeline project under the Black Sea.
- Gazprom is now seeking other potential contractors, but the move raises questions about it plans to build the proposed Turkish Stream pipeline from Russia to Turkey.
- While the project might still go ahead, searching for a new contractor with the required pipe-laying ships would delay the project by at least six months, Bernstein analyst Nicholas Green says.
- Eni (E +3%) owns a 43% stake in Saipem.
Fri, Jun. 19, 8:52 AM
- Total (NYSE:TOT) says it sold its 16.67% minority stake in the Schwedt refinery in Germany to Rosneft (OTC:RNFTF) for $300M, as part of a broader asset sale program in response to the oil price collapse.
- TOT says the sale is in line with its 2017 target to reduce its European refining and petrochemical capacity by 20%.
- Rosneft says the deal, along with the planned reorganization of Germany's Ruhr Oel, will allow it to shore up its position in the German market for refined oil products.
- Rosneft already indirectly controlled an 18.75% stake in the Schwedt refinery, with Shell (RDS.A, RDS.B), BP and Eni (NYSE:E) also owning minority stakes.
Mon, Jun. 15, 12:56 PM
- Europe’s biggest oil groups are extending business deals with their Russian energy partners despite continued western sanctions, as FT reports BP is close to a deal to acquire a 20% stake in the Taas-Yuriakh oil field in Siberia from Rsoneft (OTC:RNFTF) that could be worth $700M.
- Also, Eni (NYSE:E) and Statoil (NYSE:STO) have received approval from the their respective governments to continue work on their joint ventures with Rosneft, and Shell (RDS.A, RDS.B) continues to work on its Salym joint venture with Gazprom and has applied for approval from the Dutch government for other projects, according to FT.
- One western energy official in Moscow says European companies are "keeping the plate warm” for when sanctions are eventually lifted.
Tue, Jun. 9, 11:30 AM
- Repsol (OTCPK:REPYF, OTCQX:REPYY) joins its European peers in calling for governments to agree on carbon pricing at a UN climate summit later this year, expanding the group of energy companies seeking a voice at the meeting.
- Repsol signs the letter that BP, Eni (NYSE:E), Royal Dutch Shell (RDS.A, RDS.B), Statoil (NYSE:STO), Total (NYSE:TOT) and BG Group (OTCPK:BRGXF, OTCQX:BRGYY) released earlier this month - and that the top U.S. companies avoided - asking for a global price for carbon.
- Gas now accounts for ~55% of Repsol's total output following its acquisition of Talisman Energy in December.
Tue, Jun. 9, 9:49 AM
- Production is expected to resume at the Kashagan oil field in Kazakhstan - one of the world's biggest oil finds and most expensive oil project - in H2 2016 and aims to achieve first-phase output of up to 370K bbl/day of oil by the end of 2017, the project's managing director says.
- Kashagan began production in September 2013 but output was halted a few weeks later after leaks were detected in its pipes.
- The consortium behind Kashagan includes Exxon Mobil (NYSE:XOM), Royal Dutch Shell (RDS.A, RDS.B), Eni (NYSE:E), Total (NYSE:TOT), China's CNPC, Japan's Inpex and Kazakh state-run company KazMunaiGas.
Mon, Jun. 8, 8:40 AM
- Tanzania’s known natural gas reserves have increased by up to 18% in the last 12 months to 55T cf, up from 46.5T cf last June, following a number of discoveries in blocks off the country’s southeastern coast, the energy and minerals ministry says.
- Also, the 532-km gas pipeline connecting the offshore oilfields to the port city of Dar Es Salaam is complete and will be commissioned in September, the minister says.
- Companies including Exxon Mobil (NYSE:XOM), Statoil (NYSE:STO), Eni (NYSE:E) and BG Group (OTCPK:BRGXF, OTCQX:BRGYY) have made a series of finds off the coast of Tanzania and Mozambique in recent years, making the region a hotspot for energy investors; more than 100T cf of natural gas already have been discovered in Mozambique alone.
Thu, Jun. 4, 7:59 AM
- Saipem (OTCPK:SAPMY, OTCPK:SAPMF) -7% in Milan trading on reports that Eni (NYSE:E), its largest shareholder, may consider a share sale to address the company’s debt.
- An Italian newspaper says that investment banks had begun stepping up their pitching for a cash call at Saipem after the arrival of Stefano Cao as CEO in April.
- The report says a decision on whether to go ahead or not would be taken after the summer, adding the cash call could total ~€1.5B ($1.7B).
Tue, Jun. 2, 12:24 PM
- Europe's largest oil companies have come out forcefully against coal, while they tout their rising production of natural gas to help reduce carbon emissions and lessen the world's reliance on coal for heating homes and creating electricity.
- Royal Dutch Shell (RDS.A, RDS.B), BP, Total (NYSE:TOT), Statoil (NYSE:STO) and Eni (NYSE:E) sent a joint letter to the U.N. this week calling for measures to push up the cost of burning coal, either by taxing carbon emissions directly or reducing the supply of carbon emission credits to make those credits pricier on the secondary market.
- Financial Times notes the "more prosaic reason for the energy companies' enthusiasm" is that half of their proven reserves are in natural gas; "with a UN Climate Conference approaching in December, there is every reason for these companies to promote the use of natural gas over coal, which emits roughly twice the carbon for each unit of energy," FT says.
- Shell now produces more gas than crude oil and is set to solidify its position on top of the LNG market with its $70B deal to buy BG Group; roughly half of BP's production is natural gas, which could rise to 60% by the end of the decade.
Mon, Jun. 1, 11:18 AM
- Egypt's oil ministry says it signed a $2B deal with Eni (E -1.4%) that will enable the Italian company to explore in Sinai, the Gulf of Suez, the Mediterranean and areas in the Nile Delta.
- Eni is expected to invest $1.5B over four years in exploration, development and operation in Sinai and the Delta, plus a further $360M in digging five new wells in northern Port Said, $80M on digging a well in Sinai and repairing an existing one, and $40M in the Gulf of Suez.
- The agreement reportedly also includes $515M in signature bonuses that would partly repay some of Egypt's debts to Eni.
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