Santos Ltd.OTCPK - Current
Santos Offers The Best Leverage To A 2015 Oil Price Recovery
Da Shi Research
Da Shi Research
Dec. 7, 2015, 10:27 PM
- Woodside Petroleum (OTCPK:WOPEF, OTCPK:WOPEY) says it is abandoning its A$11.64B (US$8.46B) offer for Oil Search (OTCPK:OISHF), sending shares in the latter tumbling as much as 18% in Sydney trading.
- Woodside CEO Peter Coleman had sought a stake in Papua New Guinea’s liquefied natural gas industry, as projects there are seen as less costly than developments elsewhere and economically viable even after the oil price plunge.
- “Given the fall-off in crude pricing, it’s difficult to see Woodside raising the offer in this environment," Bernstein's Neil Beveridge tells Bloomberg. “M&A will come when companies are confident we’re at the bottom of the cycle. This signals that Woodside isn’t confident that we’re quite there yet.”
- Oil Search, which owns 29% of Exxon’s PNG LNG project, reiterates that Woodside proposal “grossly undervalued” the company; shares of Santos (OTCPK:STOSF), which also has a stake in PNG LNG, falls as much as 15% in Sydney.
Oct. 22, 2015, 9:42 AM
- Santos (OTCPK:STOSF) rejects as too low a A$7.14B (US$5.15B) takeover offer from a P-E firm backed by sovereign investors and wealthy members of Asian and Gulf-based ruling families, saying the bid was opportunistic and did not reflect the oil and gas company’s value.
- Santos has been under pressure from lower oil prices and mounting debts associated with its 30% stake in the $22B GLNG project in Gladstone state; the project, which is the key growth asset in Santos' portfolio, made its first shipment to Asia last week.
- Santos other major asset is its 13.5% stake, worth ~$7B, in the PNG LNG project in Papua New Guinea operated by Oil Search (OTCPK:OISHF), which recently rejected its own takeover offer from Woodside Petroleum.