Yesterday, 5:34 PM
- Standard & Poor's says it has taken rating actions on 14 European oil and gas E&P companies, mostly reflecting weak debt coverage measures and sometimes material negative discretionary cash flow after capex and dividends.
- S&P downgrades Tullow Oil (OTCPK:TUWLF, OTCPK:TUWOY) to B+ from BB- and EnQuest (OTC:ENQUF) to B from B+, with a negative outlook for both companies.
- The ratings agency lowered outlooks for BP, Eni (NYSE:E), Repsol (OTCQX:REPYF,OTCQX:REPYY) and Statoil (NYSE:STO) to negative.
- Royal Dutch Shell (RDS.A, RDS.B) and Total (NYSE:TOT) are affirmed with AA-/A-1+ corporate credit ratings and negative outlooks.
Tue, Sep. 29, 2:50 PM
- Statoil (STO +2.4%) says it laid the final piece of its Polarled pipeline connecting the Aasta Hansteen natural gas field in the Norwegian Sea to processing facilities and terminals on Norway's coast.
- Aasta Hansteen is estimated to hold 175B-300B cf of recoverable natural gas, making it one of the largest fields in the region; once it starts, an onshore processing terminal will be ready to receive natural gas through Polarled by 2017.
- STO says Polarled was built 32% under budget for at an investment of ~$875M; the new pipeline stretches ~300 miles and can transport up to 2.4B cf/day of gas.
Mon, Sep. 28, 8:49 AM
- BG Group (OTCPK:BRGXF, OTCQX:BRGYY) agrees to acquire stakes in three exploration blocks off the coast of Newfoundland from Repsol (OTCPK:REPYF, OTCQX:REPYY); no financial terms are disclosed.
- BG says the deal provides access to early stage exploration in a proven prospective basin ahead of the first well being drilled later this year.
- The three blocks are operated by Statoil (NYSE:STO).
Fri, Sep. 25, 9:59 AM
- Estimated capex for the first development phase of the giant Johan Sverdrup field project off Norway has been cut by NOK9B (~$1B) to NOK114B ($13.7B) due to lower contractor prices, according to a partner of lead developer Statoil (STO +1.1%).
- The first phase of operations is expected to yield as much as 380K bbl/day of oil, roughly half of the expected peak production rate; when in full swing, the huge field should account for up to 25% of all Norwegian petroleum production.
- First oil from Sverdrup is expected by late 2019.
Fri, Sep. 18, 11:58 AM
- Major oil companies including Royal Dutch Shell (RDS.A, RDS.B) and Statoil (NYSE:STO), as well as price publisher Platts, have been told by regulators to redact business secrets from documents obtained during antitrust raids, in a sign the European Union may be moving ahead with a two-year-old investigation, Bloomberg reports.
- The redaction request could be a precursor to the European Commission sending a formal complaint to some of the companies, according to the report.
- EU antitrust officials raided Shell, Statoil and Platts alongside BP and Abengoa (NASDAQ:ABGB) in 2013, warning of damage to consumers if fuel price manipulation was confirmed, but the probe has since continued in near silence.
Fri, Sep. 18, 9:47 AM
- BP (BP -2.3%) is expected to continue as operator of the ACG oil field complex after the current production-sharing deal expires, according to Azerbaijan state oil company Socar.
- The comments signal a thawing in BP’s relations with the Azeri government, after the president three years ago blamed an unexpected decline in oil output from the ACG fields on “grave mistakes” by BP.
- BP gets ~5% of its oil output from Azerbaijan; others in the ACG development group include Chevron (CVX -2.6%), Exxon (XOM -2.7%) and Statoil (STO -2.4%).
Thu, Sep. 17, 1:14 PM
- Statoil (STO -0.1%) says it has brought online the world’s first subsea gas compression facility at its Aasgard field in the Norwegian Sea, which it expects will add 306M boe over the life of the field.
- The NOK 19B ($2.34B) Aasgard subsea plant is on the ocean floor in 300 meters of water close to the wellhead, and the company considers the move a major technological leap that paves the way for full processing and production on the seabed.
- Alongside Aasgard, STO also is developing the Gullfaks subsea wet gas compressor facility, a smaller facility but also a first, as it will not require separation.
Wed, Sep. 16, 12:59 PM
- Integrated oil companies will see a huge collective negative cash flow position this year and next, with capex set to be cut further as oil prices struggle to a minimal increase in 2016, according to a Moody's forecast.
- Despite cost cuts, Moody’s still expects the industry to face a 20% contraction in 2015 free cash flows to a negative position of nearly $80B in 2015, as the ratings agency’s outlook for the global integrated oil and gas industry remains negative into next year.
- Moody’s expects the industry’s total debt load will increase, with cash balances declining as companies sell assets to cover dividends and capital spending, although most companies have resisted dividend cuts so far.
- Relevant tickers: XOM, CVX, BP, RDS.A, RDS.B, TOT, STO
Wed, Sep. 16, 10:24 AM
- ABB (ABB +0.8%) wins an order worth around $90M from Statoil (STO +3.7%) for a high-voltage cable system to provide power from shore to the Johan Sverdrup offshore oil field.
- At around 200 kilometers in length, it will be the longest extruded submarine cable system to an offshore oil and gas platform facility in the world.
Sat, Sep. 5, 8:25 AM
- ConocoPhillips (NYSE:COP) says it could support a United Nations climate change agreement if it met its own policy principles, including creating a "level playing field" among energy sources and between countries, and avoiding technology mandates.
- COP's partial endorsement comes as pressure grows on U.S. oil majors to join European peers including Shell (RDS.A, RDS.B), BP, Total (NYSE:TOT) and Statoil (NYSE:STO) who backed UN climate negotiations and a global carbon pricing system to reduce carbon emissions.
- COP and U.S. peers such as Exxon (NYSE:XOM) and Chevron (NYSE:CVX) face competing demands from green and investor activist groups as well as industry lobby groups worried that a UN deal will call for a total phase-out of fossil fuels.
Wed, Sep. 2, 3:58 PM
- Statoil (STO +1.5%) is higher after Bloomberg reports that Malaysian state-owned energy company Petronas is interested in acquiring its stake in the Trans Atlantic gas pipeline that runs from the Caspian basin to Europe.
- STO owns a 20% stake in the project but is executing a capital spending reduction plan amid falling global oil prices as it looks to raise returns for shareholders.
Tue, Sep. 1, 3:58 PM
- Citigroup's energy analysts defend their bullish take on big oil stocks such as ConocoPhillips (COP -2.6%), Total (TOT -2.1%) and Statoil (STO -4.5%), pointing to 30-year valuation lows, upside asymmetric risk on oil prices and signs that managements are doing enough to turn the corner on better capital allocation and cost-cutting.
- Favoring COP, TOT and STO, the firm says its sector investment criteria are (1) growth - companies that have near-term growth are less reliant on simply cutting costs; (2) better capital allocation - combined with growth, it should deliver 2-3x the ROE uplift than cost-cutting can; and (3) a strong enough balance sheet to manage the early part of the cycle.
- Citi is staying away from Exxon Mobil (XOM -4%) because of its valuation premium to peers and low growth and from Chevron (CVX -3.2%) due to its slow response in a lower commodity world.
Mon, Aug. 31, 5:37 PM
Tue, Aug. 18, 11:47 AM
- Having been "multi-year cautious" on Big Oil, Citigroup's Alastair Syme is getting more bullish, believing current valuations are giving very little chance to the restoration of the group's long-term profitability to long-run averages.
- He notes the sector price-to-book ratio of 1.2x is now below the Q1 2009 and Q4 1998 troughs, even with books marked to reflect world oil in the $50-$70 range.
- "This will be a long process, but the repair (cost-cutting, better capital allocation) has now started," says Syme, recommending investors at least get to benchmark weight in the group. His favored ways to play are ConocoPhillips (NYSE:COP), Statoil (NYSE:STO), Total (NYSE:TOT), and BG Group (OTCQX:BRGYY) as a cheaper way to get into Shell (NYSE:RDS.A).
- Notably not on the list are ExxonMobil (NYSE:XOM) thanks to its valuation premium and low growth (through the strong balance sheet is worth a look), and Chevron (NYSE:CVX) - "slow to adjust to a lower commodity world."
- Previously: BAML: Capitulation in emerging markets, commodities, and energy-related stocks (Aug. 18)
Wed, Aug. 5, 11:58 AM
- Statoil (STO +0.6%) is seeking to deepen its ties with Russia's Rosneft (OTC:RNFTF) even amid sanctions, saying it has started a process to secure rig capacity to drill two wells next year in the Sea of Okhotsk in Russia’s far east and to run test production at the North Komsomolskoye oil field during the winter.
- The objective at the heavy oil field, which holds ~600M metric tons of oil, is to test whether production and recovery rates can make exploitation profitable, and the companies would drill more wells if tests prove successful, STO says.
- The company says Russia is still among the top five regions it expects will drive growth in its international production over the next decade, alongside Tanzania, Brazil, Canada and the U.S.
Tue, Jul. 28, 9:49 AM
- Statoil (STO +2.6%) opens with solid gains after beating Q2 estimates on the top and bottom lines, reporting Q2 earnings of NOK3.15/share vs. NOK1.62 analyst consensus and revenues of NOK138.5B vs. NOK124.8B consensus.
- STO says it booked a one-off gain of NOK12.3B on the sale of its interest in Azerbaijan's Shah Deniz gas field.
- STO says it is further cutting its capital expenditures by 3% to $17.5B, which already is down from $20B last year.
- Q2 production totaled 1.87M boe/day, up 4% Y/Y, with 7% underlying production growth after adjusting for divestments.
- While STO’s average liquids price fell to $55/bbl from $99.7 a year ago, refining margins improved to $9.6/bbl from $3.9; net operating income for its marketing and processing unit almost doubled to NOK5.1B from a year earlier.
- STO is "sailing through with strong operating performance and visible management response on costs. Statoil’s results prove once again just how resilient its business model actually is,” says Bernstein's Oswald Clint.
STO vs. ETF Alternatives
Statoil ASA is an integrated oil and gas company. It explores, produces, transports, refines, and markets petroleum and petroleum-derived products. It has operations in Norway, rest of Europe, North America, Africa, Asia and South America.
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