Daily Archives: June 5, 2017

NEW DELHI: India-focused offshore funds and exchange-traded funds (ETFs) have pumped in over USD 500 million in May, taking the total to USD 3.6 billion so far this year.

An offshore India fund is one that is not domiciled in the country but invests primarily in its markets.

According to a report by mutual fund tracker Morningstar, India-focused offshore funds have infused a net amount of USD 360 million last month, while that of ETFs poured in USD 140 million, during the same period.

This comes following a total net inflow of USD 1.10 billion in April.

In comparison, net inflow by Foreign Portfolio Investors (FPIs) in equities stood at USD 1.4 billion last month.

"The most prominent reason for the inflow is expectation from the government that it would speed up development and economic reforms in their last two years in office before going for elections in 2019. The government finalising GST rates and expectation that it will be rolled out on time in addition to forecasts of normal monsoon also led to positive sentiments," he added.

So far in 2017, India focused offshore funds have pumped in USD 2.7 billion compared to USD 895 million by India focused offshore ETFs, the report noted.

Follow this link:

Offshore India funds, ETFs pump in $500 million in May - Economic Times

By Anshuman Daga and Sumeet Chatterjee | SINGAPORE/HONG KONG

SINGAPORE/HONG KONG The sale by Malaysian energy firm Petronas of an estimated $1 billion stake in a local upstream gas project has moved to the second round and is set to attract interest from about half a dozen bidders including Royal Dutch Shell and ExxonMobil Corp, four sources familiar with the matter said.

State-owned Petroliam Nasional Bhd (Petronas) had kicked off a process to sell a stake of up to 49 percent in the SK316 offshore gas block in Malaysia's Sarawak state, Reuters reported in February.

Prospective buyers are expected to submit second round financial bids this month, and a final decision on the successful bidder is expected later this year, said two sources.

Sources said Total, PTT Exploration and Production PCL and some Japanese firms are also among those keen to bid for the asset.

The transaction, if completed, would mark Petronas' biggest upstream stake sale since oil prices started falling more than two years ago.

All the sources declined to be identified as discussions between Petronas and the companies are private, adding that terms of the deal could change depending on how the talks proceed.

Petronas, which last week maintained a cautious outlook for the rest of the year after reporting quarterly profit more than double a year ago, did not respond to a request for comment.

In a statement to Reuters in April, it had said that through its unit, Petronas Carigali, it was seeking partners who could bring the technology and capabilities to explore, develop and efficiently operate the various fields and opportunities in the SK316 offshore gas block.

Shell, ExxonMobil and Total declined to comment.

PTT Exploration said it was keen to invest in Thailand and Southeast Asia due to its expertise in these markets and as costs and risks were low.

"This area is consistent with the company's expansion strategy, however, the company will consider details of each project before making an investment decision," PTTEP said in response to a query on its interest in the Petronas asset.

Gas from the NC3 field in the SK316 block feeds Malaysia's LNG export project, known as LNG 9, a joint venture between Petronas and JX Nippon Oil & Energy Corp that began commercial production in January.

The sale of a stake in the offshore gas block has been clouded by political opposition to the process, but sources said this was unlikely to derail ongoing talks.

Opposition party leaders in Sarawak, a key vote base for Malaysian Prime Minister Najib Razak who is likely to call general elections this year, have expressed disapproval in Petronas' plan to find a partner.

One even called for the state to be given the option to acquire all or part of the stake that it proposes to sell.

Sarawak Chief Minister Abang Johari, however, has said the state did not want to take on the risk of developing the gas field as "the project cost billions of ringgit and it is of high risk," according to state news agency Bernama.

He said the state government was in talks with Petronas about the partner-finding process for SK316.

(Reporting by Anshuman Daga in SINGAPORE and Sumeet Chatterjee in HONG KONG; Additional reporting by A. Ananthalakshmi in KUALA LUMPUR and Chayut Setboonsarng in BANGKOK and Jessica Jaganathan in SINGAPORE; Editing by Richard Pullin)

U.S. homebuilder D.R. Horton Inc said on Monday it had offered to buy 75 percent of real estate development company Forestar Group Inc for about $520 million.

PARIS Societe Generale will sell up to 23 percent of its car leasing arm ALD Automotive in an initial public offering (IPO) this month, the French bank said on Monday, potentially raising as much as 1.6 billion euros ($1.8 billion).

UK mail delivery company DX Group agreed to acquire John Menzies' distribution arm through a reverse takeover on Monday, securing backing from its largest investors after terms of the deal were revised.

See the original post:

Petronas' stake sale of offshore gas asset advances to second round: sources - Reuters

After several years of discussing the possibility of setting up a new shipyard in Saudi Arabia, the Kingdoms national oil company, Saudi Aramco, has entered into a new adventure. As one of the first NOCs, Aramco is diversifying its operations from upstream and downstream operations to become a major offshore services provider and operator. After decades of the hiring offshore rigs and vessels from third parties, such as Arabian Drilling Company, Aramco has now taken the step not only to own its own jack-up rigs but also to build them at a new shipyard in Ras Al Khair. Aramco has signed a joint-venture (JV) deal with UAE based engineering company Lamprell, Saudi national shipping company Bahri and Asian giant Hyundai Heavy Industries Company. As stated by Saudi officials, the yard will be the anchor project within the King Salman International Complex for Maritime Industries and Services located in Ras Al Khair, near the Jubail Industrial City on the Kingdoms east coast.

The current plans entail the set-up of the Gulfs largest integrated maritime yard, not only in production capacity and scale, but also in having Saudi Aramco as the main investor. This will present Aramco with the opportunity to design, construct and maintain around 20 jack-ups, while also having the capacity to support the manufacture, maintenance, repair and overhaul of offshore support vessels and commercial vessels. Taking into account that Saudi Arabias main shipping company Bahri is one of the partners, the yard is expected to also service very large crude carriers (VLCCs).

The original plans were put in place based on the assessment that the JV will offer Saudi Aramco a local provider for its offshore drilling and shipping activities. Cost optimization, reduced response times and higher agility is to be expected. Present capacity is slated to entail the construction of four offshore rigs, around 40 offshore vessels (including three VLCCs) and service of 260 maritime products per year. The first vessels and rigs are expected to be built from 2019 onwards, while full production capacity is projected to be reached in 2022. Related:Canada Pushes For Zero Emission Vehicle Strategy

Not mentioned in any of the current media reports is the fact that the Ras Al Khair yard, owned and paid for by Aramco, will not only be targeting local Saudi demand. The Ras Al Khair will be competing with existing yards in the GCC (UAE-Bahrain) and Asia. Looking at the current offshore rig market, this is a big gamble. Since the crude oil price crash, a long list of offshore rigs have been stacked while other projects have been put on hold. Commercial incentives for new builds are not easily found.

But the Ras Al Khair Yard is the new kid on the block, and it has lots of influence behind it. Aramco is the majority stakeholder, able to force other partners in the JV to comply to local demands and specifications. Looking at the offshore market at present, it could even be stated that Aramco will be able to force other yards out of business as it can demand that its co-investors build all new rigs in Saudi Arabia. With a list of 20 new builds already, Aramcos pulling power is not to be ignored. Related:Has Permian Productivity Peaked?

If Aramco is able to construct and operate the new yard to the highest standards while also supporting the schooling of Saudi offshore rig engineers in the coming years, current rig builders will be in trouble. The localization drive, as linked to Saudis Vision 2030 and Aramcos IKTVA, is a new influence that the market will need to get acquainted too. If Aramco succeeds here, other NOCs are sure to follow suit, leaving the traditional parties without any real options to survive the current onslaught. Offshore engineering companies, ship yards and rig providers will have to reassess their options. The traditional market structure may already be obsolete.

The $5.2 billion Ras Al Khair Yard project is a prime example of the ongoing changes within Saudi Aramco at present. The industry giant is going through dramatic changes, expanding beyond its NOC status and challenging on the international market. Aramco has entered the market with a bang, and markets should expect more big moves in the build up to what is being marketed as the biggest IPO in history.

By Cyril Widdershoven for Oilprice.com

More Top Reads From Oilprice.com:

Original post:

Aramco Aims To Take Over The Offshore Rig Market - OilPrice.com

BP Trinidad & Tobago (bpTT) has made two significant gas discoveries after drilling the Savannah and Macadamia exploration wells in offshore Trinidad.

Both discoveries are estimated to contain nearly two trillion cubic feet (Tcf) of gas, which will encourage new developments in the area.

bpTT regional president Norman Christie said: We are starting to see the benefits of the significant investment we have made in seismic processing and Ocean Bottom Seismic acquisition. Savannah and Macadamia demonstrate that with the right technology, we can continue to uncover the full potential of the Columbus Basin.

bpTT drilled the Savannah exploration well into an untested fault block located east of Juniper field in more than 500ft water depths, nearly 80km south-east coast of Trinidad.

A semi-submersible rig was used to drill the well, which encountered 650ft net pay in hydrocarbon-bearing reservoirs in two main intervals.

"It was drilled to test exploration and appraisal segments below the existing SEQB discovery."

The company intends to develop these reservoirs through future tieback to the Juniper platform due to come on-stream this year.

The Macadamia well was drilled to test exploration and appraisal segments below the existing SEQB discoveryand penetrated hydrocarbon-bearing reservoirs in seven intervals with around 600ft in net pay.

bpTT owns 100% working interest in Savannah and Macadamia wells.

In addition, the company received approval to develop its Angelin offshore gas project located nearly 60km from south-east coast of Trinidad in water depth of around 65m.

The project comprises construction of a new platform which will represent bpTTs 15th offshore production facility in the area.

Continued here:

BP makes two offshore gas discoveries offshore Trinidad - Offshore Technology

Victoria is angling fora massive floating liquefied natural gas import facility to allow the state to buy gas from overseas to help tackle a serious supplycrisis.

Despite the state's potentially enormous gas reserves in Bass Strait, and Australia's position as one of the world's largest exporters,the Andrews government is understood to be in active talkswith energy giant AGL to build afloatingLNG import terminalclose to Melbourne, possibly in Western Port.

The terminal, which would supply the east-coast gas grid,would allow Victoria, NSW and South Australiato import lower cost gas,potentially from the US or Western Australia.

Premier Daniel Andrews is expected to press the planat a Council of Australian Government's meeting on Friday, along with a new proposalto help prevent local manufacturers and households from being denied access to cheaper gas because of big export contracts to Asia.

The state government is understood to have offered to "fast track" the environmental and planning approvalprocess for the facility, which would be likely to cost $200 to $300 million, although the decision would ultimately lie with the Commonwealth.

Victoria is believed to be seen as a favourable option,partly because it is located between NSW and South Australia, which would lower pipeline costs, and partly because, unlike NSW, it already has significant storage capacity at the Iona plant, near Port Campbell inthe state'ssouth-west.

The idea of the new import facility was first floated by AGL chief executive Andy Vesey in November last year.

At the time, the idea thatAustralia, soon to be the world's largest LNG exporter, would need to import gas was dismissed.

But with some businesses in the southern states reportedly being quoted as much as $20 a gigajoule this year, up from as little as $4 a gigajoule in 2015, the idea is gaining traction.

Industrial gas users in Japan which is the largest buyerof AustralianLNG pay much less, about $12 agigajoule.

The global price is now even lower than the price that has been contracted by LNG producers to supply the Asian market, thanks to a significant oversupply.

The idea of the new terminal would be to buy LNG for south eastern Australiaat the lower global price.

Energy Minister Lily D'Ambrosiosaid there was something "seriously wrong" when Australia gas was being sold in Japan for a lower price than businesses were being charged for it in Victoria.

University of Melbourne Climate and Energy College research fellow Dylan McConnell said releasing new gas supplies into the Victorian market was unlikely to influence short-term prices for industrial users because new supplies could take a long time to development.

Governments also needed to consider that some consumers were shifting away from gas due to new household technologies that relied on electricity, Mr McConnell said.

He argued that some households were withdrawing from gas in favour of new electric technologies, including induction cook tops, electric hot water and heating and rooftop solar.

The Australian Energy Market Operator has also raised doubts about whether new supplies would translate to lower prices, citing the increased cost of sourcing new gas and the "geological challenges of extraction".

See the rest here:

Floating offshore gas hub proposed to tackle Victoria's energy supply crisis - The Age

Director of the Gas Projects Coordinating Office (GPCO), Peter Koim, tells Loop PNG that there are currently some loopholes that need to be addressed before a fully-fledged offshore project takes place.

Our different laws have been initially designed to host on-shore projects, whether it be mining, LNG projects, or oil projects, said Koim.

There are some deficiencies in the existing laws to address a full fledged operation offshore. And I think our state solicitors office and our legal experts are looking at those missing links so there will be amendments to close in on those gaps before we move offshore projects into the development forum and actual development.

One of the loopholes that Koim pointed out in the current act is the free carry two percent equity for landowners.

He said this clause is not applicable for an offshore project, Koim said.

When the law was enacted, this particular area was not looked at.

Like now the Pasca Project, were using the oil and gas act to try and address the issue but then, the project has to make available two percent free carry equity to the landowner. But we dont have landowners in the ocean. So who benefits from that two percent?

How are you going to answer that question so these are things that within the state we are looking at and we will find some answers and address it by way of amendment to the act.

Two offshore gas discoveries include the Pandora Field, between Torres Strait and PNG, and Pasca A, located in the Gulf of Papua. Twinza Oil has acquired a majority of interest in both gas fields.

Other potential offshore projects include Petroleum Prospecting License (PPL) 374 and PPL 375, which is operated by ExxonMobil, of which Oil Search has in each a 40 percent interest.

Loop file photo

Read the rest here:

Potential offshore projects prompt review of Act - Loop PNG