Energy

Anglo takes quick, dirty route to greener pastures

8 Feb 2021

The miner may dump its African coal unit, worth maybe $1 bln. A spinoff could add six times that sum to the $45 bln group’s value by luring eco-conscious investors. Yet it doesn’t cut global emissions, and Anglo American’s iron ore assets may soon feel the environmental heat.

Enel will be hard to dislodge from green perch

5 Feb 2021

The Italian utility has become one of the world’s top renewable energy players and achieved stellar returns under CEO Francesco Starace. A booming green market and a big project pipeline mean its lead will outlast his tenure. Oil majors entering the market will trail behind.

Shell’s strength jars with sedate green strategy

4 Feb 2021

The $140 bln oil giant earned $4.8 bln last year as rivals made losses. Next week’s strategic overhaul is unlikely to involve big cuts in crude output or BP-style wind power targets. The cautious approach runs counter to its green-leader image – and the prevailing investor mood.

BP walks green high wire without a safety net

2 Feb 2021

The $72 bln UK oil major missed analysts’ expectations and announced a $6 bln annual loss. CEO Bernard Looney’s bigger problem is that his firm’s shares have underperformed since he committed to wind and solar. Investors may be fretting that his pivot from crude is too violent.

Exxon-Chevron tie-up is right deal, tricky time

1 Feb 2021

A potential $350 bln mega-deal entices on paper with savings that could be valued as high as $20 bln. That would shore up both companies against oil’s darkening future. Exxon would need humility, though, and government a desire for a fossil fuel champion. Both are huge hurdles.

Chevron looks exposed without cover from Exxon

29 Jan 2021

The $171 bln oil group's shares fell premarket on Friday despite a reduced fourth-quarter loss and steady production. Boss Mike Wirth is maintaining a strong balance sheet. That sets Chevron up well, but without its larger rival's usually same-day earnings, there's less to like.

Bond markets will be new climate vigilantes

27 Jan 2021

Booming demand for sustainable funds and new EU rules will make debt investors more wary of buying securities issued by polluters. There are already signs that is happening in the oil and gas sector. Higher funding costs should be a powerful spur for companies to get serious.

Climate activists melt Exxon glacier of truculence

27 Jan 2021

The $194 bln oil giant has largely ignored investors worried about the environment and that oil's best days are over. Now it may add independent directors, make greener investments, and cut capex. Credit squeaky activists plus a rumbling threat from institutions like BlackRock.

Clean-shaven GE finally heaves into view

26 Jan 2021

Larry Culp is targeting the kind of cash flow the U.S. group was making two years ago, only with fewer workers and $30 bln less debt. Success depends on the still-grounded aviation division. But the chief executive’s revamped bonus plan means he’s well motivated to hit his goal.

Naturgy offers cut-price route to green transition

26 Jan 2021

IFM is spending 5 bln euros on 23% of the Spanish utility. Naturgy’s depressed shares and the Australian fund’s use of debt will juice its returns. Moreover, it’s a cheaper way of surfing the renewable energy wave than boarding rivals like Iberdrola.

How to pick the hydrogen industry’s future Amazon

22 Jan 2021

The element could play a major role in decarbonisation, which has sent shares in related companies skyrocketing. As with the 1999 tech-stock boom, investors can’t tell which group can corner the market. But they can see which uses of hydrogen will become cost-competitive first.

China’s energy policy keeps blowing fuse

21 Jan 2021

Widespread electricity rationing last month slowed factory output, threatening another harsh winter for Chinese households. Banning Aussie coal didn’t help, but Beijing has stalled reforms to its grid monopoly, forcing a choice between emissions targets and keeping the lights on.

Total’s Indian green energy splurge has two hedges

18 Jan 2021

The French giant is upping its exposure to renewable power by buying 20% of Adani Green Energy. The $2.5 bln price tag is well below the target’s market value. Teaming up with tycoon Gautam Adani may also help avoid problems suffered by other Western energy groups in India.

Chevron makes bet on being last man standing

12 Jan 2021

Mike Wirth, the $180 billion energy firm’s boss, thinks oil demand will stay strong. That contrasts with rivals like BP, which sees production down 40% by 2030. Chevron has the advantage of size. But plans to outlast or acquire rivals are risky in a rapidly evolving industry.

Viewsroom: Predictions and prescriptions (Part 1)

23 Dec 2020

Governments will become activist investors; U.S. airlines will merge; data centres will be the new ESG target; energy giants to consider renewable spinoffs; Tesla will buy Daimler; European soccer gets more American and more. Rob Cox, Peter Thal Larsen and Lauren Silva weigh in.

Time for India to end its global tax fights

23 Dec 2020

The Hague awarded Cairn Energy $1.4 bln in its spat with New Delhi, more than the UK group’s market cap. Vodafone had a similar win. Accepting these outcomes would make Boris Johnson’s January visit run smoothly, and inject credibility into India’s global investment ambitions.

Corona Capital: Vaccine dibs

21 Dec 2020

Concise views on the pandemic’s corporate and financial fallout: Vaccine prioritization is about to get competitive.

Big Oil will cash in on sun and wind

21 Dec 2020

Covid-19 and ESG have crushed the stock prices of companies like Total and BP. Listing their growing renewables businesses would help capitalise on inflated valuations. There’s a hedge of sorts: if the spinoffs don’t work they can be bought back on the cheap, Iberdrola-style.

Repsol stake sale could speed up green shift

16 Dec 2020

The 13 bln euro Spanish oil group may offload 25% of its gas stations arm. Flogging a chunk of what is a relatively highly valued business could raise 2.5 billion euros. That would provide critical firepower to get Repsol’s renewable energy capacity closer to rivals like Total.

Corona Capital: Gaming M&A, Beauty’s bold face

9 Dec 2020

Concise views on the pandemic’s corporate and financial fallout: Consolidation in video games reaches the next level as Sweden’s MTG buys Hutch Games for $375 million; and Spanish cosmetics, fashion and perfume group Puig predicts revenue will double by 2023.