Oil & Gas

Chevron’s deal shines awkward spotlight on Shell

15 Apr 2019

The U.S. oil major's $33 bln offer for Permian powerhouse Anadarko may spark similar moves by rivals. The region’s independent players face challenges and are priced accordingly. Were Shell to play M&A catch-up, though, it would risk cramping its climate change-conscious style.

Chevron doubles down with $33 bln Anadarko swoop

12 Apr 2019

The $239 bln U.S. oil giant is buying its domestic peer in a cash-and-shares deal. Hefty synergies more than cover the offered premium. As rivals try to become greener, Chevron is sticking to what it knows by buying big in global oil’s key growth area.

Africa uprisings carry stark oil-addiction warning

12 Apr 2019

Veteran leaders in Algeria and Sudan have been unseated. Rising unemployment, inflation and weak growth are the immediate reasons why, but a broader common theme is too heavy a reliance on crude extraction. That’s not a problem limited to Africa.

Aramco frenzy is wrong measure of Saudi renewal

10 Apr 2019

Frantic demand for the oil giant’s $12 bln bond issue might be interpreted as a sign of support for the desert kingdom’s efforts to diversify its economy. Yet securing long-term investment is harder than selling securities. And only some of the buying reflects genuine enthusiasm.

Overpriced Aramco debt still has a Saudi discount

10 Apr 2019

Strong demand for the oil giant’s first bond allowed it to raise $12 billion at lower rates than expected. Borrowing costs are still higher than Western oil peers. But it makes little sense for investors to view the bonds as less risky than Saudi’s tarnished government.

Engie gets the gas but without the gearing

8 Apr 2019

The French utility’s $8.6 billion deal to buy Petrobras’ Brazilian gas pipelines enables expansion in one of its core areas. Doing so with Canada’s CDPQ limits the extent it needs to push up its debt. That should help keep its new three-year strategy on the road.

Carlyle shows Mubadala benefits of procrastination

8 Apr 2019

The buyout group is acquiring 30-40 pct of Cepsa from the Abu Dhabi fund. The $12 billion enterprise value is in line with the Spanish energy group’s aborted IPO last October. The only downside is that a listing would have made it easier for Mubadala to sell more in future.

Viewsroom: What’s driving Lyft’s valuation?

4 Apr 2019

The ride-hailing firm is worth $30 bln after its stock-market debut, even though its losses are growing. Shareholders are betting a shift to autonomous driving will steer it to a profit, but that may be a long way off. Plus: Saudi Aramco lets investors drill into its finances.

Exxon shows climate activists a red rag

3 Apr 2019

The oil giant squashed an investor proposal to set emissions-reductions targets, with help from the U.S. markets watchdog. It’s pretty short-sighted, and raises the risk disgruntled shareholders start using blunter weapons, like votes on board directors and executive pay.

Shell hits climate ball back into investors’ court

2 Apr 2019

The $260 bln oil major is tying lobbying to its emissions-reduction agenda, augmenting its status as the industry’s most progressive on global warming. It’s a low bar, though. Shell’s modest concession should motivate shareholders to keep holding big polluters’ feet to the fire.

Aramco is just not big enough

2 Apr 2019

The Saudi oil producing giant is hyper-efficient, but it still doesn’t warrant the $2 trillion value envisaged by the kingdom’s crown prince.

Saudi Aramco is big, just not big enough

2 Apr 2019

The oil producer’s accounts show it is hyper-efficient. That helps its valuation, as does the rise in the price of crude since Aramco first flirted with an IPO. But while the company is a giant, it still doesn’t warrant the $2 trillion value envisaged by Saudi’s crown prince.

Aramco flashes its cash but also its independence

1 Apr 2019

The Saudi oil giant’s debut bond prospectus shows $111 bln of net income in 2018. Yet Aramco will only pay half the $69 bln needed to acquire Riyadh’s SABIC stake upfront. Potential debt and equity investors will be heartened that there is an implied limit to government meddling.

Saudi’s $69 bln asset rejig starts banker payback

27 Mar 2019

Aramco is buying a 70 pct stake in chemical group SABIC from the kingdom’s sovereign wealth fund. The reshuffle is mostly an internal affair but the oil giant will issue bonds to pay for it. That gives banks who have spent years courting the company some return for their efforts.

China’s majors fill up on gas at the right time

22 Mar 2019

PetroChina’s losses on gas imports swelled to nearly $4 bln in 2018, thanks to low domestic rates. Yet China’s oil giants are preparing to buy more LNG from U.S. firms. That aids the trade cause. More importantly, it may help lock in supply before a forecast shortfall.

Shale drillers may be singing oil’s swan song

12 Mar 2019

Cash is flooding into Texas wells, attracted by quick investment returns. Yet the Permian’s short production cycles may hasten the arrival of peak oil. With sustainability investors pressing for cleaner fuels, some industry executives are already planning for a post-crude future.

Big Oil is too quick to rest on its laurels

8 Mar 2019

Exxon and Chevron paid more attention to climate change over the past year - and outperformed the S&P 500. But new plans to invest in Texas drilling show old habits die hard. Oil buffs gathering for the industry’s annual confab may wonder if the industry is shifting fast enough.

Norway’s mega-fund fluffs move away from crude

8 Mar 2019

Oslo’s $1 trillion wealth fund will ditch oil exploration stocks, but stay invested in groups that also do refining. As a big producer Norway needs to tread carefully. But accepting the risk of subpar returns could have been a way to show greater climate change leadership.

Nigeria votes for another four years of drift

27 Feb 2019

Re-elected President Muhammadu Buhari faces a daunting to-do list. His first term suggests most of it will stay undone. Easing the state’s grip on the currency and oil sector could revive growth. That the former general’s main rival backed such reforms means neither is likely.

Norway’s giant oil fund flaunts Achilles’ heel

27 Feb 2019

The Nordic state’s $1 trillion wealth vehicle lost money in 2018. A political mandate that obliges it to hold more equities rather than diversifying its exposure explains why. Even if these shackles were removed, the fund’s size complicates efforts to rev up performance.