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Fri, Jan. 15, 9:29 AM
Fri, Jan. 15, 8:36 AM
- Petrobras (NYSE:PBR) says has canceled plans to issue debentures on the Brazilian market, which was expected to raise at least 3B reais ($750M), citing unfavorable capital market conditions.
- PBR, which suspended the issue temporally back in October, now will cancel it definitely as Brazil’s stock and debt markets have experienced high volatility in recent months.
- The world's most leveraged oil company had planned to use the proceeds from the issue to fund part of its existing investment program and lengthen the maturity of its debt.
- PBR -9.1% premarket.
Thu, Jan. 14, 3:26 PM
- Energy stocks are broadly higher as U.S. crude oil bounces off $30/bbl to end pit trading at $31.22, +2.6%; the SPDR Energy ETF (XLE +5.1%) soars 5%, with 36 of its 40 equity components trading higher, after closing yesterday at its lowest level since September 2010.
- Exxon Mobil (XOM +5.5%) and Chevron (CVX +5.9%) are the Dow's top two gainers; and pipeline companies sport strong showings with Kinder Morgan (KMI +8.2%), Plains All American Pipeline (PAA +11.7%) and Williams Cos. (WMB +27.4%) among the biggest winners.
- Among other major energy movers: ETE +22.6%, BP +7.6%, MRO +7.5%, OXY +7.1%, PBR +7%, COP +7%, RDS.A +6.7%, SE +6.1%, PSX +6.1%, ETP +6.1%, EPD +5.3%, APA +5%, E +4.6%, HES +4.1%, MPC +4.1%.
- Amid overwhelmingly negative sentiment, a few analysts are venturing out to say the worst may be over or nearly so: Deutsche Bank’s Torsten Slok thinks "we now have the worst behind us in terms of the negative impact of falling oil prices on the economy," and Gluskin Sheff’s David Rosenberg argues that the oil selloff is getting “long in the tooth.”
- ETFs: USO, OIL, XLE, UCO, UWTI, VDE, ERX, OIH, SCO, XOP, BNO, DBO, DWTI, ERY, FCG, DIG, GASL, DTO, DUG, BGR, USL, XES, IYE, IEO, IEZ, DNO, FENY, PXE, PXI, PXJ, FIF, OLO, SZO, NDP, RYE, FXN, OLEM, DDG
Wed, Jan. 13, 8:47 AM
- Petrobras (NYSE:PBR) is seeking to sell its 5.8B Brazilian real ($1.4B) stake in petrochemical producer Braskem (NYSE:BAK), Reuters reports, citing local newspaper Folha de S. Paulo.
- A sale would help PBR meet its target of selling ~$15B worth of assets in 2015-16, a key part of its plan to cut debt amid plunging oil prices.
- PBR owns a 36% stake in Braskem, Latin America's largest petrochemical producer.
Tue, Jan. 12, 9:17 AM
- Petrobras (NYSE:PBR) receives a license allowing it to boost crude processing by 35% at its controversial Abreu e Lima refinery, the local Pernambuco state government says, a move that lets the company delay installation of promised pollution controls.
- Under the license, PBR can process up to 100K bbl/day of crude at the refinery, up from 74K bbl/day under the previous license; the license requires the company to use a special low-sulfur crude blend instead of high-sulfur heavy crude from Brazil's Campos Basin near Rio de Janeiro that the refinery was designed to process.
- At $20B - 5x the original budget - Abreu e Lima probably is the most expensive refinery ever built; only one of two 115K bbl/day heavy oil refining trains at the plant is operating, but the new license raises the train's processing capacity to 87% from 64%.
Tue, Jan. 12, 7:45 AM
- Petrobras (NYSE:PBR) -2.9% premarket after announcing a ~25% reduction in planned investments for the 2015-19 period to $98.4B, the lowest in years, and warning that more declines in oil prices and the nation's currency could lead to further revisions.
- PBR says 81% of the planned capital spending, or ~$80B, would go to exploration and production investments.
- PBR cuts its 2016 estimate for average oil output in Brazil to 2.145M bbl/day from a prior target of 2.185M bbl/day; 2015 oil production in Brazil averaged a company record 2.128M bbl/day, in-line with its target and 4.6% more than 2.034M in 2014.
Thu, Jan. 7, 11:42 AM
- Brazil remains a major concern for Ensco (ESV -2.9%) after Petrobras (PBR -0.2%) quashed a rig contract with the company earlier this week, Cowen analysts say, noting that ESV has four other rigs working for PBR contracted for work in Brazil and scheduled roll off contract between October 2016 and July 2018 accounting for ~15% of ESV’s $6.6B backlog as of Sept. 30, 2015.
- While two of the rigs underwent significant equipment upgrades in recent years, funded by PBR and tailored to meet specific project requirements in Brazil, Cowen says this by no means offers protection against a contract cancellation.
- The firm see further downside to ESV shares if additional contracts are canceled, despite the sharp move lower in the last two days.
Thu, Jan. 7, 7:55 AM
- Petrobras (NYSE:PBR) will present a five-year investment plan in coming weeks that is even leaner than the $19B plan announced in October, according to a Brazilian newspaper.
- In addition to cutting investment in areas such as onshore and shallow water areas, PBR may have to add more assets to its list of 26 currently for sale, the report says.
- Separately, PBR says its 178K bbl/day Presidente Bernardes refinery is producing normally although there are some delays in delivering fuel; a union official said earlier that the refinery was operating below capacity after poorly performed maintenance work on its main distillation unit.
Wed, Jan. 6, 8:48 AM
- Ensco (NYSE:ESV) -2.6% premarket after saying Petrobras (NYSE:PBR) ended a contract for a drillship over allegations of corruption.
- PBR claims Pride International, a company ESV bought in 2011, had knowledge that the rig's shipbuilder made "improper payments" to a marketing consultant who then shared the money with former PBR employees; ESV says it has found no such evidence and that it has not been contacted by other Brazil government authorities about any alleged wrongdoing.
- ESV says other rigs leased to PBR will continue to work under their contracts.
Tue, Jan. 5, 12:26 PM
- Petrobras (PBR -2.7%) executives, board members and investors are growing frustrated that CEO Aldemir Bendine has not done enough in his first year to tackle the company’s many problems, according to a WSJ report.
- Bendine is said to spend too much time in São Paulo, where he lives, and not enough at PBR's Rio de Janeiro headquarters.
- "The initiatives that have been taken are very small considering the challenges that Petrobras faces," a Rio-based oil consultant tells WSJ.
- Brazil Pres. Rousseff chose Bendine for the top job last February to help clean up PBR following the company's corruption scandal, but he has had trouble solving problems such as a massive debt load, low oil prices, powerful unions and an often-interventionist government.
Mon, Jan. 4, 6:50 PM
- Moody’s foresees capital spending reductions of at least 20%-25% in 2016 across the oil and gas E&P business, with oilfield services and drilling remaining the most stressed energy segment.
- Moody’s expects M&A activity and industry consolidation in 2016 to increase in a subdued manner given that the timing of a commodity price recovery remains uncertain; the firm notes that Devon Energy (NYSE:DVN) has targeted the sale of $2B-$3B in assets for 2016, Husky Energy (OTCPK:HUSKF) also has reported plans to sell select legacy upstream assets, and ConocoPhillips (NYSE:COP) likely will continue trying to divest select upstream assets in 2016.
- Globally, Moody's expects to see a rise in distressed exchanges and defaults in 2016, and cites Brazil's Petrobras (NYSE:PBR), Mexico's Pemex and Venezuela's PdVSA as three major international companies that are in serious trouble; the ratings agency also sees credit metrics for PetroChina (NYSE:PTR), Sinopec (NYSE:SNP) and Cnooc (NYSE:CEO) continuing to deteriorate through at least 2017, while Russia’s weak ruble will help Rosneft (OTC:RNFTF) withstand low oil prices.
- Moody’s recently projected a "lower for much longer" energy scenario, with average prices of WTI crude at $40/bbl in 2016 - $8 lower than its earlier forecast - $45/bbl in 2017 and $50 in 2018.
- ETFs: XLE, VDE, ERX, OIH, XOP, ERY, FCG, DIG, GASL, DUG, BGR, XES, IYE, IEO, IEZ, FENY, PXE, FIF, PXJ, NDP, RYE, FXN, DDG
Dec. 30, 2015, 12:46 PM
- Hit hard two days ago as oil fell below $37/barrel, oil/gas industry names are seeing more pain today after the EIA reported U.S. crude inventories rose by 2.6M barrels last week - expectations were for a decline. The report comes shortly after the API estimated U.S. crude inventories rose by 2.9M barrels during the most recent weekly period.
- After rising yesterday, WTI crude is down 3.1% to $36.71/barrel. Brent crude is down 2.9% to $36.69/barrel. Nymex natural gas is down 7.3% to $2.20/MMBtu.
- The biggest decliners include Chesapeake Energy (CHK -4.1%), Petrobras (PBR -4.1%), Linn Energy (LINE -7.5%), Gulfport Energy (GPOR -5.2%), SeaDrill (SDRL -5.5%), MV Oil Trust (MVO -4.5%), EV Energy Partners (EVEP -6.7%), and Southwestern Energy (SWN -5.7%).
- Other notable decliners include Hercules Offshore (HERO -5.2%), Marathon Oil (MRO -4%), Devon Energy (DVN -4.4%), Encana (ECA -4.1%), Range Resources (RRC -4.7%), Sandridge Mississippian Trust (SDR -4%), Newfield Exploration (NFX -3.8%), BP Prudhoe Bay Royalty Trust (BPT -3.1%), Enerplus (ERF -3.9%), and ONEOK Partners (OKS -2.5%).
- ETFs: XLE, VDE, ERX, OIH, XOP, ERY, DIG, DUG, BGR, IYE, IEO, FENY, PXE, FIF, PXJ, NDP, RYE, FXN, DDG, DRIP, GUSH
Dec. 22, 2015, 4:58 PM
- Petrobras (NYSE:PBR) management is on the right path to improving the company's financial position and Brazil's government has no plans to pump cash into the company, new finance minister Nelson Barbosa says.
- Barbosa made the comments while seeking to reassure skeptics that the country's economy would reverse a slide that has been complicated by impeachment proceedings against the president as well as the Petrobras corruption scandal.
- Barbosa recently replaced Joaquim Levy, who had been finance minister for less than a year after facing persistent criticism from Pres. Rousseff and her colleagues in the leftist Workers Party over his effort to restore the Brazil’s fiscal and economic health through budget cuts.
- ETFs: EWZ, BRF, BRZU, EWZS, BRXX, BRAQ, BZQ, BRAZ, BRAF, UBR, DBBR, FBZ
Dec. 17, 2015, 8:58 AM
- Petrobras (NYSE:PBR) says its oil and natural gas production for November fell to 2.712M boe/day, 1.9% less than October's output of 2.765M boe/day and the lowest level in 16 months.
- PBR says November production in the pre-salt layer gained 1.8% from October to 1.023M boe.
- November saw Brazil's oil unions cut production in their biggest strike against the company in 20 years.
Dec. 16, 2015, 12:59 PM
- Petrobras (PBR -1.9%) will have a smaller structure within four years but be much more profitable than today, and the divestment program adopted by the company this year will be increased next year, CEO Aldemir Bendine says.
- PBR will come out of its current crisis strengthened and become "more profitable than today with greater operational capacity," the CEO says, adding that the $15B divestment plan announced earlier this year would be completed in 2016 with the sale of additional assets.
- But shares are lower as Fitch Ratings downgrades Brazil’s debt ratings into junk territory, moving the country’s long-term foreign and local currency issuer default ratings to BB+ from BBB- with a negative outlook.
- And in the latest news involving the corruption probe into PBR, Brazil's federal police yesterday raided the homes and offices of the House speaker and other politicians.
- ETFs: EWZ, BRF, BRZU, EWZS, BRXX, BRAQ, BZQ, BRAZ, BRAF, UBR, DBBR, FBZ
Dec. 11, 2015, 5:25 PM
- Petrobras (NYSE:PBR) says it is not considering selling a 10% stake in its giant Libra offshore oil prospect at this time, Reuters reports.
- PBR was responding to a Reuters report earlier in the week that industry sources believed the Libra stake was on offer as part of a plan to cut debt by selling $15B of assets by the end of 2016.
- Petrobras is operator and 40% owner of Libra, while Total and Royal Dutch Shell each own 20%, and Chinese companies Cnooc (NYSE:CEO) and PetroChina each hold 10%.
Petroleo Brasileiro SA Petrobras operates as an integrated oil & gas company in Brazil. Its business is structured into segments such as Exploration & Production; Refining, Transportation & Marketing; Distribution; Gas & energi; Biofuel; & International.
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