Energy

Chevron’s deal shines awkward spotlight on Shell

15 April 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 April 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.

Engie gets the gas but without the gearing

8 April 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 April 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.

Swiss do their bit for energy resource nationalism

5 April 2019

France’s EDF is selling its quarter-stake in fellow utility Alpiq for $489 million. That helps existing Swiss investors take the group private. But it also fits with a wider trend where European states are happier with vital infrastructure being held by domestic owners.

Viewsroom: What’s driving Lyft’s valuation?

4 April 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 April 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 April 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 April 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 April 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 April 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 March 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.

Shell CEO’s bonus problem less size than length

14 March 2019

Ben van Beurden’s 20 million euro pay for 2018 is more than double the previous year. Given Shell’s share performance over the last three years, a bumper payout is logical. Yet holding shares for just three years would allow him to cash out before any climate crunch hits Big Oil.

RWE’s German carve-up looks better than E.ON’s

14 March 2019

A year after a 17 bln euro asset swap, the German utilities’ deal is in Brussels’ antitrust sights. It’s more an issue for E.ON, which may lose out if forced disposals erode hoped-for cost savings. RWE, meanwhile, seems to have chosen the right time to bulk up in renewables.

EDP overhaul makes Chinese bid look extra stingy

12 March 2019

The Portuguese utility will sell assets to cut debt and invest in renewables. It looks like a balancing act between the demands of activist Elliott, and Portugal’s government. But the potential boost to EDP’s value bolsters the case for rejecting an offer from China Three Gorges.

Hadas: A bluffer’s guide to the MMT debate

6 March 2019

So-called modern monetary theory might be gaining respectability, after the radical approach was touted along with a huge “Green New Deal” by U.S. Democrats. Mainstream economists are fighting back. The debate, riddled with politics, hinges on at least five questions.

Shale drillers may be singing oil’s swan song

12 March 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 March 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 March 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.

Engie demystifies before activists come calling

28 February 2019

The French gas and power group is decluttering its complex structure by exiting 20 markets. Engie’s state ownership and Belgian nuclear albatross act as a brake on activism, but won’t always save it if its undervaluation lingers. Still, steps to close the gap with big wind and solar peers suggest a capacity for self-help.