Monthly Archives: June 2017

2. Offshore Banking in Singapore

When Singapore gained independence half a century ago, it was a backwater with no natural resources.

Today, it is one of the leading financial centers in the world.

Considering Singapores foreign reserves and sovereign wealth fund, the countrys financial position is exceptional, with net assets well over 100% of GDP.

In short, there is no chance Singapore is going broke any time soon.

The Monetary Authority of Singapore (MAS) is also solvent, and over the past few decades has proven to be a wise financial regulator.

Thats why Singapore has never had a banking failure in its history, ever.

And while past performance is no guarantee of future results, the entire banking system continues to maintain conservative levels of capitalization and liquiditycertainly much more than banks in the West.

It remains an oasis of financial stability. Its banks are well supervised and well regulated.

We wouldnt hesitate opening an offshore bank account in Singapore.

That being said, in the past you could open an excellent bank account in Singapore without even leaving home, but it has gotten much harder over the past few years.

Nowadays you will have to visit the island state in person andmany banks require substantial minimum deposits now.

First, lets get the elephant out of the room.

Unless youve been living under a rock, you are without a doubt aware of the Panama Papers scandal.

Thanks to that, Panama is suffering from an image problem.

Yes, theres a long list of politicians and crooks who used the services of the Mossack Fonseca law firm to hide income or immorally acquired funds.

But most of the Panama Papers uproar is just ballyhooing by people who dont understand (or dont want to understand) how offshore works... or why its so essential to the global economy.

Panama is a 100% dollarized economy and you will be dealing with US dollars as a depositor there.

On top of that Panama is just a short flight away from North America, so the physical presence requirement can be easily met if you reside in the States.

We have spent weeks crunching the numbers and visiting multiple banks in the country, and we can tell you that Panamas banking sector regardless of what ill-informed, financially illiterate journalists report is on solid footing.

Panamanian banks are liquid and well capitalized. Additionally, the governments debt position of 39.1% is pretty manageable.

Here at Sovereign Man we focus on providing objective, rational advice. Here it is:

The Panama Papers scandal should not deter you from considering banking in Panama if that is a jurisdiction that works for you.

On top of that Panama is the easiest place in the world to establish a second residency, which means you can knock out two major Plan B needs with just one visit.

A tiny German-speaking principality sandwiched between Switzerland and Austria, Liechtenstein, like its Swiss neighbor, has perfected the art of banking.

Liechtenstein has long been known as one of the top asset protection and private banking jurisdictions in the world.

The country is in compliance with all major directives and treaties for anti-money laundering and tax regulation initiatives, and it is rightly seen today as a well-regulated, blue-chip, offshore (technically onshore) destination.

Liechtenstein does not bother providing transactional banking to non-residents and focuses instead on high-end services (and does them extremely well).

If you are looking for a private bank, rather than a transactional bank account, we think Liechtenstein should be on your radar.

Not a single bank in Liechtenstein needed ANY assistance from the state during the global financial crisis. The countrys banks are generally conservative and well run.

Unfortunately, only a few of Liechtensteins banks have gone through the trouble and expense of setting up entities licensed as investment advisors with the SEC. Those few are the only ones able to take US persons as clients.

Follow this link:

Offshore Banking: - Sovereign Man

I've been following Teekay Offshore Partners (NYSE:TOO) for some time due to my interest in everything offshore drilling - related. Finally, a Morgan Stanley downgrade led to a decisive downside gap in Teekay Offshore units and I decided to take a closer look at the situation to determine whether the move presented a speculative opportunity.

On the surface, there were two catalysts behind the major downside moves in May and June. In May, Teekay Offshore reported its quarterly results where it stated that it received a notice of termination for the Arendal Spirit UMS (unit for maintenance and safety). In June, Morgan Stanley report assigned a $1.50 target to Teekay Offshore units.

At first glance, the market reaction is strange. Arendal Spirit has not been paid since November 2016, so the termination is hardly a surprise. As for the Morgan Stanley downgrade, the report did not include any new and surprising information that has not been available before. However, I'd argue that nothing strange happened - in fact, the stock market often operates in this way.

Arendal Spirit termination is minor news - the absolute majority of Teekay Offshore's revenue comes from FPSOs and shuttle tankers. At the same time, such negative news put the company in the spotlight and the market reacts to what it should have reacted previously - the refinancing concerns regarding Teekay Offshore.

Businesses like Teekay Offshore depend on open credit and equity markets for their operations. As of March 31 the company had $193 million of cash on the balance sheet while the current portion of long-term debt stood at $621 million. During the conference call, the company stated that it was working with lenders under the facility secured by the Arendal Spirit to grant an extension of the facility while the company was searching for the new job for the unit. Also, Teekay Offshore stated that it was considering partial asset sales and joint ventures to improve its liquidity.

In current circumstances, it looks increasingly unlikely that Teekay Offshore will be able to tap equity markets for short-term financial help. In this sense, Morgan Stanley's downgrade acts as a self-fulfilling prophecy, pushing Teekay Offshore's units down and almost eliminating the possibility of an equity raise. Another problem is the state of the offshore drilling market, which is yet to see the light at the end of the tunnel.

There was much talk about offshore drilling adaptation to lower oil prices during the recent earnings season but I have not seen factual confirmation for this. Oil price action itself is alarming, with both Brent (NYSEARCA:BNO) and WTI (NYSEARCA:USO) below $50 per barrel despite OPEC/non-OPEC deal. The outlook for the offshore drilling market will certainly influence the lender's decision regarding Teekay Offshore's indebtedness.

The main problem as I see it may be that lenders demand significant concessions from Teekay Offshore including the elimination of distribution. The elimination of distribution typically puts big pressure on the units as distribution is the main reason to invest in such companies.

In my view, the risk/reward balance is not great neither for the long nor for the short side here. Any real positive news on negotiations and the shorts could be killed as Teekay Offshore units are already at low levels. At the same time, the fundamentals of the offshore drilling business are bad in the short-term and will influence the company's negotiations with lenders. In these games, common unitholders carry a disproportionate amount of risk. I think that not all this risk has already been baked in Teekay Offshore's unit price so if additional negative information comes out there'll be more room to fall.

My verdict is that Teekay Offshore units are currently an avoid for everyone except short-term traders who rely on technical analysis for their entries and exists. I believe that it will be hard to control risk in both a long or a short position if it held for more than a couple of days.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Additional disclosure: I may trade any of the abovementioned stocks.

View original post here:

Teekay Offshore: Speculative Opportunity? - Seeking Alpha

By Mary Ann Bragg Cape Cod Times

NORTH KINGSTOWN, R.I. With the countrys first offshore wind farm up and running for the past six months, labor and environmental advocates are looking toward future collaborations on even larger projects.

Many years of hard work ensured that these were good quality union jobs that paid good solid wages, said Kimberly Glas, executive director of BlueGreen Alliance, a coalition of labor unions and environmentalists, as a chartered boat neared the Block Island Wind Farm on Tuesday.

As more offshore wind energy projects are developed off New England and New York more grassroots effort is needed, Glas said.

I ask folks to start calling their legislators and start showing up at city council meetings to figure out ways to ensure that these are quality jobs, she said.

The nonprofit National Wildlife Federation sponsored the boat tour of the 30-megawatt, five-turbine wind farm installed by Deepwater Wind, one of three offshore wind energy companies with plans to build more wind turbines on leased land south of the Islands. The federation, with 6 million members, wants to protect wildlife from the effects of climate change through clean energy options such as wind.

This kind of (boat) trip allows our company to talk about how offshore wind can be built and has been built in the United States, said Matthew Morrissey, Massachusetts vice-president for Deepwater Wind.

The partners in Block Island project were environmental groups, organized labor, government regulators, fishing groups and others, Morrissey said.

Its an opportunity to come together and see that you can actually build a new economy in America while protecting the environment, he said about the tour.

Among the 115 people on board the fast ferry Ava Pearl were labor leaders representing union members such as welders, painters and crane operators who helped build the wind farm.

Construction of the wind farm created 300 local jobs, according to Deepwater Wind.

They did sign an agreement to do it all union, said Scott Duhamel of the Rhode Island Building and Construction Trades Council.

The political strength of unions in Rhode Island, with the support of congressional and state legislators, along with union representatives showing up at and speaking at public meetings, all helped seal the deal, Duhamel said.

I have to admit they could do it without us but they didnt, he said.

Deepwater Wind could have used non-union labor, Duhamel said.

They did it with us, he said. We feel our people are better trained.

The typical wages of the union workers who worked on the wind farm ranged from $28 to $40 per hour plus benefits, union representatives said.

Were thankful to Deepwater for having trust not only in IBEW but the building trades in general, said Michael Monahan, a regional vice-president of International Brotherhood of Electrical Workers.

While the construction of a wind farm employs many people in the short term, the long-term maintenance of the equipment creates more jobs, said Monahan and Rhode Island Department of Labor and Training Director Scott Jensen.

Were doing the commute that thousands and thousands of people are going to be doing over the next any number of years, Jensen said as the boat passed alongside the towering turbines.

Monahan and others said they are hoping for more union contracts in upcoming offshore wind energy projects.

At the end of June, theres an opportunity to bid on power contracts with three electric distribution companies in Massachusetts, which could attract Deepwater Wind, Bay State Wind and Vineyard Wind, all of which have signed leases for federal land south of the Islands. Bay State and Vineyard Wind officials said recently that they could start construction in the early 2020s.

Excerpt from:

Labor, environmentalists tout first US offshore wind farm - SouthCoastToday.com

MOSCOW Rosneft and its partners plan to invest 480 billion roubles ($8.4 billion) in developing Russia's offshore energy industry in the next five years, part of a bid to boost output from new areas, the Russian oil major told Reuters.

Most Russian oil output comes from western Siberia, where fields are depleting, pushing firms to look for new regions. Sanctions complicate the process, barring Western firms from helping with Arctic offshore, deepwater and shale oil projects.

Russia is producing almost 11 million barrels per day (bpd) of crude, slightly down from its peaks last year as the country has joined OPEC and some other non-OPEC nations in an output cut that runs to March to stabilize global crude prices.

Of the 480 billion roubles allocated for offshore projects by Rosneft and its partners, the Russian company planned to invest 250 billion roubles in Arctic offshore between 2017 and 2021, the state-controlled firm wrote in response to Reuters questions.

"Development of hydrocarbon resources on the continental Arctic shelf is the future of global oil production and one of the key strategic priorities for the company," Rosneft, the world's biggest listed oil company by output, said in an email.

It said the Arctic offshore area was expected to account for between 20 and 30 percent of Russian production by 2050.

Rosneft did not mention which partners would be involved in the investments. It said it had licences for 55 offshore blocks in Russia's Arctic, Far East and southern regions, which are believed to contain oil and gas resources.

Andrey Polishchyuk, an analyst with Raiffeisenbank in Moscow, said the allocated sum was big enough for exploration drilling, though actual production could be years away.

"I would not look at the actual timing of the production launch at the offshore projects, I would rather look at the oil price and feasibility of those projects," he said.

"For now, Rosneft has been engaging in exploration drilling in the Arctic, and this is right as sooner or later those resources will be needed."

He also said Rosneft needed to focus on onshore oilfields, such as East Siberia's Vankor, one of its key production clusters.

The firm has sought tie-ups with several global oil players to develop Russia's offshore regions. But a deal to work in the Arctic Kara Sea with U.S. company Exxon Mobil was suspended in 2014 after the imposition of Western sanctions.

Rosneft said in its email that it planned to return to operations in the Kara Sea in 2019 but did not specify whether it would work alone or with a partner.

The Russian company also has deals for offshore work with Norway's Statoil, Italy's Eni and other firms.

Rosneft, Exxon, Japan's Sakhalin Oil and Gas Development Co Ltd (SODECO) and India's ONGC are partners in the Sakhalin 1 project off Russia's far east coast.

So far, Russia's sole Arctic offshore oilfield is Prirazlomnoye in the Pechora Sea operated by Gazprom Neft, where production is gradually rising from about 40,000 bpd last year.

Rosneft also said it planned preparation work next year at the Wild Orchid gas condensate field in Vietnam at Block 06.1. It did not say when production would start.

(Writing by Katya Golubkova; additional reporting by Vladimir Soldatkin; Editing by Edmund Blair and Dale Hudson)

TORONTO Freeport-McMoRan Inc , the world's biggest publicly traded copper miner, and China Molybdenum Co Ltd (CMOC) have agreed to terminate discussions on CMOC's acquisition of Freeport's cobalt assets, Freeport said on Wednesday.

Saudi Aramco's planned 2018 public share offering is being slowed down by a divide between Saudi Arabia's ruling family and executives of the kingdom's state oil company over where to list its shares, the Wall Street Journal reported on Wednesday.

See more here:

Exclusive: Rosneft, partners to invest over $8 billion in Russia's offshore energy sector - Reuters

Actions taken to ensure the safety of three offshore oil and gas leases near Platform Holly and an update on the Venoco Chapter 11 bankruptcy involving the offshore leases are among the items to be discussed by the State Lands Commission when it meets Thursday, June 22.

The meeting is scheduled to begin at noon in the Jetway Room of the Hyatt Regency, Los Angeles International Airport, 6225 W. Century Blvd., Los Angeles. A live webcast of the meeting will be available at http://www.cal-span.org.

Commissioners are also slated to consider an application from Santa Barbara County Parks Department for a lease of ocean areas to place seasonal swim and channel marker buoys, floats and signs to designate special use areas and a boat launch corridor.

The commission also will discuss passing a resolution opposing the presidential executive order Implementing an America-First Offshore Energy Strategy that establishes a policy encouraging energy exploration and production on the outer continental shelf.

Read more here:

SB County offshore oil leases topic for State Lands Commission - Santa Maria Times (subscription)

SINGAPORE, June 15, 2017 /PRNewswire/ -- On Jun 7th, 2017, Tunghsu Group successfully completed its US$350million offshore USD bond offering. Goldman Sachs acted as sole global coordinator and sole bookrunner in the transaction. Through site visit in Wuhu, Anhui, and roadshows in Hong Kong, Singapore and London, the Company had comprehensive communications with 100 investors via various forms including site visits, face-to-face meetings and luncheons, and demonstrated to global investors outstanding corporate image and rare investment value as a Chinese private-owned enterprise. Despite the fact that international financial market was impacted by political events including the terrorist attack in UK and the UK general election during the roadshows, with the assistance from Goldman Sachs, Tunghsu Group still seized the favorable issuance window and was well-recognized by 87 high-quality and well-diversified investors from 8 regions, including global blue-chip funds, sovereign wealth funds, large Asian bond funds and Chinese institutions etc.

The offshore USD bond issuance by Tunghsu Group has created multiple "highlights" in the market, including largest debut USD bond issuance from a group holding company in Asia Pacific high yield space, lowest coupon achieved by a debut offering by a group holding company in Asia Pacific high yield space, and first privately-owned company in the optoelectronic and high-end equipment sectors to ever issue a USD bond in Asia Pacific credit capital markets.

Excerpt from:

Tunghsu Group Successfully Consummated its Inaugural Offshore USD Bond Offering - PR Newswire (press release)

Europes oil majors are eyeing opportunities in offshore wind are you?

Renewable energy is reshaping global energy markets. For the oil majors, this poses a threat to legacy oil and gas operations, but is also an opportunity to diversify and future-proof portfolios, as a recent report from Wood Mackenzie highlighted.

As Wood Mackenzie notes, the growth opportunity in renewables cannot be ignored. It forecasts average annual growth rates of 6 per cent for wind and 11 per cent for solar over the next 20 years. Renewables will have captured a much bigger slice of the global energy market by the middle of the next decade.

Wood Mackenzie believes that the value proposition of offshore wind is competitive with some upstream investments. Returns rank favourably with many of the majors pre-sanction long-life developments, the most comparable upstream asset class.

Wood Mackenzie believes that offshore wind may offer them the most attractive route to organic growth in the near-term. It offers scale and scalability on a par with upstream mega-projects. It expects capital to be diverted from upstream to build positions in wind and solar.

Growth in offshore wind is something the majors cannot afford to ignore as they plan for 2035 and beyond. They need to diversify and can bring their expertise in the value chain to help balance portfolios and hedge against future erosion of the upstream value proposition and the anticipated hardening of investor sentiment towards carbon.

That would be one of the reasons why, as I reported in out sister magazine, Offshore Wind Journal, that Shell, which recently returned to the offshore wind market after a long absence, says it would like to see large-scale, integrated development of offshore wind projects of up to 10 gigawatts. If that seems unlikely at the moment, dont forget that offshore wind industry leader Dong Energy evolved into a pure-play offshore wind outfit from what was once an oil and gas company.

Shell is looking to grow its footprint in wind in the coming years and is proposing that the next phase of offshore wind development be thought of as a stepping stone, a de-risking exercise, towards a much bigger offshore wind industry that operates at the scale of the potential resource. Its belief is that industrial development at scale would lower cost, create value across the supply chain, and stimulate economic growth. Offshore wind has already comfortably exceeded cost reduction targets. The next phase of its development could see oil companies stepping in, with capital and expertise, prompting development of mega projects that will dwarf existing windfarms. The European majors are leading the way, shaping strategies to establish a presence in this fast-growing market.

Read the original post:

Big oil's ambition could transform offshore wind - OSJ Magazine