Commodities

Aussie petrol station bidding war lacks fuel

8 Jan 2020

UK-based EG Group is interested in buying pump operator Caltex Australia, raising pressure on Canada’s Couche-Tard to up its $6 bln offer. Its costs could already far exceed returns, however. For the target, it’s only a possible relief from a fraught go-it-alone IPO plan.

Iran will decide if oil bulls outdo gold bugs

7 Jan 2020

Middle East tensions have boosted crude prices more than that of the precious metal. Tehran could yet attack Saudi oil fields or disrupt the vital Strait of Hormuz. Anything less than that would see gold, which was already in high demand, outperform.

Why didn’t Qatar support Saudi Aramco’s big deal?

16 Dec 2019

With Riyadh still blockading Doha, that may sound like a silly question. Yet joining Gulf neighbours in buying the oil giant’s shares could have helped to bury the hatchet. Qatar’s decision underlines a key issue with rapprochement: both sides want it, but Saudi needs it more.

Glencore’s new probe applies shove to succession

5 Dec 2019

British police are investigating possible bribery at the commodity giant. Two days ago 62-year-old boss Ivan Glasenberg, whose firm also faces a U.S. probe, said he could retire next year. Having to fight a legal war on two fronts may help him make up his mind.

Gold diggers may find growth is copper-bottomed

5 Dec 2019

Rising prices have filled coffers for bullion miners. Now some, like $31 bln Barrick, are arguing future growth may come from a more modest metal: copper. Using safe-haven returns to bet on a similar, underperforming, material has logic, despite tarnished M&A precedents.

Canada’s Aussie gas station bid needs more fuel

26 Nov 2019

Quebec-based Couche-Tard has offered $7.3 bln including debt for Caltex to expand its filling station empire Down Under. At more than 9 times EBITDA the price looks good, while rival bidders are scarce. A mooted real estate IPO is Caltex’s best hope to squeeze out more value.

Cairn obstructs Delhi’s $100 bln energy target

20 Nov 2019

India’s oil minister says there is no better place to invest, as he courts foreign firms and a lofty investment goal. A long-running tax fight between the government and Cairn, however, undermines the promise of predictable policies. The sooner the case is resolved, the better.

BHP boss hands over big shovel to successor

14 Nov 2019

Andrew Mackenzie departs the world's largest miner next month, leaving it in better shape than he found it. Veteran Mike Henry will face fresh challenges. He must make and sell a decision on a $20 bln potash project, and steer the steel ingredient producer into a greener era.

Australia compounds resource industry climate woes

8 Nov 2019

Prime Minister Scott Morrison wants to crack down on environmental protesters. Companies, he argues, should listen to "quiet shareholders" instead. That's bad advice for outfits like BHP and for his government: both deserve to face more pressure on low-carbon options, not less.

Mongolia’s coal IPO squeezes through narrow hole

6 Nov 2019

Ulaanbaatar has picked advisers to list part of its prize mine. It's a tough sell: a landlocked deposit with only one market, a history of political meddling and a decade of false starts. Still, Chinese backing and an upcoming election might help Mongolia pull it off this time.

Aramco IPO can choose either price or credibility

4 Nov 2019

The Saudi Arabian oil giant’s long-delayed float is finally underway. It might seem success hinges on how close Riyadh gets to its desired $2 trillion valuation. A better benchmark is how much foreign investors buy in to the local listing. They’ll require a much lower price tag.

Restive Chile squeezes copper’s big short

23 Oct 2019

Violent protests halted work at the world's largest mine for the red metal, adding to disruptions elsewhere. The price of copper, however, is not far off a 2019 low, and the market anticipates further weakness. Pessimistic noise on global trade is drowning out supply signals.

Aramco’s latest IPO delay is a triple fail

18 Oct 2019

It’s embarrassing enough that the Saudi oil giant has again postponed its float. The hitch also messes up the kingdom’s efforts to show its best side at an upcoming annual finance junket. And it undermines Saudi’s already-shaky attempts to attract more foreign investment.

Angola’s answer to Aramco has similarly tricky IPO

9 Oct 2019

Like Saudi Arabia, the secretive African nation wants to float its state oil firm. With a possible $50 billion valuation, Sonangol is no minnow but years of delays suggest a 2022 listing deadline could slip. As with Riyadh, the long-term threat to oil gives good reason to hurry.

BP’s new boss has a tougher gig than forerunner

4 Oct 2019

Bernard Looney will replace Bob Dudley as the oil major’s chief executive. While the latter restored BP’s image and balance sheet after the Gulf of Mexico spill, the exploration veteran will manage the transition to a low-carbon world under a very bright spotlight.

Big steel can reform its way to a longer life

30 Sep 2019

Rio Tinto will work with China's top producer to make steel greener. From Shell to BHP, resources firms are starting to tackle emissions churned out by oil, coal and the like, after they are sold. Such climate-friendly moves may also keep costs manageable, and an industry going.

Canadian miner gives copper a belated deal patina

25 Sep 2019

China’s biggest producer of the metal may have built a nearly 10% stake in $6 bln First Quantum, and is negotiating to invest in its Zambian assets. The low price of copper, and depressed industry valuations, make it a good time to do more. It puts Rio Tinto on the M&A spot.

Hong Kong’s first UK exchange foray clouds second

20 Sep 2019

Its 2012 takeover of the London Metal Exchange promised to preserve the institution and expand in China. Hong Kong’s bourse honoured the first, but Beijing made its own way in commodities. Returns have been poor too. That history informs its $37 bln London Stock Exchange bid.

First oil cut isn’t the deepest for world economy

16 Sep 2019

Crude prices jumped almost 10% after weekend attacks on Saudi oil facilities took out over 5% of global supply. Though the spike is bad for already slowing global growth, reserves can make up for the shortfall. Escalating threats of Middle Eastern conflict would do more damage.

Some Aramco IPO banks look more equal than others

12 Sep 2019

The Saudi oil giant has picked nine banks as global coordinators for its revived listing. They all get bragging rights. Yet despite the implied equality, they won't all do the same job. Banks that led the first stab at the IPO, like JPMorgan, will still probably call the shots.