26 Jan 2017: Saudi Aramco not going ahead with Petronas for Johor project - RAPID
Saudi Aramco not going ahead with Petronas for Johor project: WSJ 25 January 2017 Read more at http://www.thestar.com.my/business/business-news/2017/01/25/saudi-aramco-not-going-ahead-with-petronas-for-johor-project-wsj/#LKtPTGvDSORu0kVq.99
Earlier news:
- Petronas decision on Rapid deal with Aramco in Dec? 28 OCTOBER 2016 -- Petroliam Nasional Bhd (Petronas) is said to be making a final investment decision in December to partner with Saudi Arabian Oil Co (Saudi Aramco) by offering a 50 per cent stake in its refinery and petrochemical integrated development project (Rapid) in Johor. According to the Wall Street Journal (WSJ) report yesterday, if Petronas proceeds with the plan, the two companies will set up a joint-venture company in the first quarter of next year to run the project, with the refinery due to start operating in early 2019. Read More : http://www.nst.com.my/news/2016/10/183983/petronas-decision-rapid-deal-aramco-dec
- Petronas-Aramco seek $10b loan for Johor project SEP 30, 2016 - Talks with banks have begun; however, analysts say profit squeeze could force rethink of Canadian gas plans - Malaysia's national oil corporation Petronas and the Saudi Arabian Oil Company (Saudi Aramco) have begun negotiations with Malaysian-based banks to raise a record US$7.5 billion (S$10 billion) syndicated loan to finance a planned refinery and petrochemical complex in Johor. Bankers familiar with the loan syndication said that the 50-50 joint venture between the two international oil giants will be a straight-forward loan ahead of a much larger bond issue further down the road to finance the Refinery and Petrochemical Integrated Development Project, or Rapid, as it is called in the Pengerang industrial zone in Johor. http://www.straitstimes.com/asia/se-asia/petronas-aramco-seek-10b-loan-for-johor-project
- Petronas Could Soon Seal Partnership With Saudi Aramco on $21 Billion Refinery - Malaysia’s state oil firm in December is expected to offer the Saudi Arabian giant a 50% stake in the project By YANTOULTRA NGUI Oct. 27, 2016 http://www.wsj.com/articles/petronas-could-soon-seal-refinery-partnership-with-saudi-aramco-1477545192
Note: Customised news update is available for 29 Sep 2016 - 26 Jan 2017
29 Sep 2016: Petronas-led LNG project gets Canada approval amidst China deals tilt
Editor's note: Canada approves Petronas-led $27 bln LNG complex. Reports say Petronas is in no rush to start. The view from KL is that this is an important plus for Petronas. It's good news as a continued stall would have dragged Petronas - this is its single largest project. A significant stake had been sold to China interests. The view from a Canada businessman is that this is good for Canada. Low oil prices have hit Alberta. LNG is clean fuel, although there is some environmental impact from this project. Note: Canada and China recently signed various state level MOUs. Thus, both Malaysia and Canada have had state-level or G2G agreements with China.
Federal government approves $11.4-billion LNG project in B.C. September 28, 2016 -- Pacific NorthWest LNG has been one of the leading LNG project proposals for several years, along with the Shell-led $25-billion LNG Canada project in Kitimat and the Chevron-led $12-billion Kitimat LNG project. Shell and Chevron have secured federal and provincial environmental approvals, plus First Nations support at the terminal, and significant support along their pipeline routes.....But the Greater Vancouver Board of Trade welcomed the announcement, which it noted is subject to 190 conditions, and includes up to $2.5 billion in annual tax revenue and nearly $3 billion in annual contributions to Canada’s GDP. “The Pacific NorthWest LNG project will energize the Canadian economy,” said the board of trade’s president and CEO, Iain Black. http://vancouversun.com/news/local-news/feds-flying-to-vancouver-for-historic-lng-decision-expected-to-ok-megaproject
Canada approves $36 bn LNG project, eyes Asia 28 Sep 2016 -- The project includes a pipeline and two Petronas terminals to ship gas to Asia. The gas terminals are to be built on Lelu Island, near Prince Rupert on the Pacific coast. Each will have a capacity of six million tons per year, with the possibility of adding a third down the road. The pipeline built by the operator TransCanada must cross 900 kilometers of British Columbia between Hudson's Hope (about 400 kilometers or 250 miles north of Prince George), ending at Lelu Island. The pipeline deal comes after Petronas in late 2012 snapped up Canada's Progress Energy Resources gas producer for USD 5.2 billion.
The deal means heavy LNG traffic through a maze of islands where salmon is a vital resource. However, others were upbeat about job opportunities. The green light for the pipeline project comes a few weeks after a key meeting between federal and provincial governments to define the necessary steps to reduce carbon emissions under last year's Paris climate agreement.
Read more at: http://www.moneycontrol.com/news/wire-news/canada-approves-usd-36-bn-lng-project-eyes-asia_7534301.html?utm_source=ref_article
Pacific NorthWest LNG, a consortium comprised of Petroliam Nasional Berhad (Petronas 62%), Japan Petroleum Exploration Company (JAPEX 10%), PetroleumBRUNEI (3%), Indian Oil Corporation (10%) and China Petrochemical Corporation (Sinopec 15%). http://www.hydrocarbons-technology.com/projects/pacific-northwest-lng-project/
Fastest Asia-U.S. Shipping Route? Canada’s Ports http://www.wsj.com/articles/fastest-asia-u-s-shipping-route-canadas-ports-1418335017
China, Canada resolve canola-shipping dispute; to boost trade ties SEPTEMBER 22, 2016 By David Ljunggren and Rod Nickel http://atimes.com/2016/09/china-canada-resolve-canola-shipping-dispute-to-boost-trade-ties/
Strengthening of Canada-China commercial relationship September 1, 2016 http://pm.gc.ca/eng/news/2016/09/01/strengthening-canada-china-commercial-relationship
Canada to Join China-Led Infrastructure Bank in Win for Xi by Bloomberg News August 31, 2016 http://www.bloomberg.com/news/articles/2016-08-31/canada-to-join-china-led-infrastructure-bank-in-victory-for-xi
29 August 2016: Sarawak and Sabah reps on Petronas board after Sarawak staffing tussle
After Sarawak, Sabah rep to join Petronas board Sunday August 28, 2016 - See more at: http://www.themalaymailonline.com/malaysia/article/after-sarawak-sabah-rep-to-join-petronas-board#sthash.49Leg91p.dpuf
Sarawak says ‘not in picture’ over Petronas’ oil production share with foreign firms Sunday August 28, 2016 - See more at: http://www.themalaymailonline.com/malaysia/article/sarawak-says-not-in-picture-over-petronas-oil-production-share-with-foreign#sthash.m8P0fhWc.dpuf
Petronas, Sarawak resolve seven staffing issues, says Adenan 22 comments Edward Subeng Stephen, Bernama Published 27 Aug 2016 https://www.malaysiakini.com/news/353829
End to Petronas-Sarawak controversy by fintan ng and p aruna 23 August 2016 http://www.thestar.com.my/business/business-news/2016/08/23/end-to-controversy/
Sarawak DAP mulls taking Petronas hiring issue to Parliament Tuesday August 23, 2016 - See more at: http://www.themalaymailonline.com/malaysia/article/sarawak-dap-mulls-taking-petronas-hiring-issue-to-parliament#sthash.ki8Tg7QT.dpuf
Petronas: Most workers needed in Sarawak will be from the state 10 August 2016 | MYT 9:39 AM http://www.thestar.com.my/business/business-news/2016/08/10/petronas-most-workers-needed-in-sarawak-will-be-from-the-state/
Work permit freeze due to real hiring bias, Sarawak DCM tells Petronas BY SULOK TAWIE Wednesday August 10, 2016 - See more at: http://www.themalaymailonline.com/malaysia/article/work-permit-freeze-due-to-real-hiring-bias-sarawak-dcm-tells-petronas#sthash.e8w5lbJt.dpuf
Petronas to explain decision in terminating employees from Sarawak 8 August 2016 | MYT 9:35 PM http://www.thestar.com.my/news/nation/2016/08/08/petronas-to-explain-decision-in-terminating-employees-from-sarawak/
14 August 2016: Petronas Sarawak staff retrench woes, oil and gas company woes in Singapore and Malaysia
State will be fair in immigration dealings with Petronas staff: Nancy August 14, 2016, Sunday Churchill Edward... KUCHING: A Sarawakian minister in the Prime Minister’s Department assured citizens that the state government will be fair in the dealings with immigration involving national petroleum corporation Petronas staff. The minister Nancy Shukri was reacting to the recent action taken by the Sarawak government led by Chief Minister Datuk Patinggi Tan Sri Adenan Satem following grouses expressed by Sarawakians over Petronas selection of manpower.
Nancy said: “I have been following the arguments on the drastic action taken by the Sarawak state government against Petronas. It was clearly stated by the Sarawak state government that any new applications for work permits from Petronas have been frozen as a result of complaints from Sarawakian Petronas officers whose services were terminated and retrenched as revealed by Suarah Petroleum Group. (SPG). It is a normal action by the state.”... She added that the action was based on the complaints by the SPG and definitely there was a basis to the complaints. “The action against Petronas was the first after 1963 using the autonomy power of the state through immigration law.... Secondly, it was an isolated and independent action upon receiving complaints from SPG and Sarawakians as a whole. However. she opines sit also reflects that Sarawakians are becoming more aware of their rights under the constitution and the state government has to act accordingly for the interests of Sarawakians under the constitution. “I would say that it is nothing to do with the devolution issues since the negotiation is in progress and committment given by the federal government is very positive....... http://www.theborneopost.com/2016/08/14/state-will-be-fair-in-immigration-dealings-with-petronas-staff-nancy/
http://www.theedgemarkets.com/my/article/og-meltdown-will-there-be-more-casualties
12 July 2016: PETRONAS reaches cessation deal with SapuraKencana, Petrofac for Berantai
PETRONAS Reaches Deal with SapuraKencana, Petrofac for Berantai by Chee Yew Cheang Rigzone Staff July 11, 2016 -- Malaysia's national oil company (NOC) Petroliam Nasional Berhd (PETRONAS) announced Monday that it has reached an agreement with Petrofac Energy Developments Sdn Bhd and SapuraKencana Petroleum Berhad's subsidiaries Kencana Energy Sdn Bhd and Sapura Energy Ventures Sdn Bhd for the cessation of the Berantai Risk Service Contract (RSC) located in Block PM 309 offshore Terangganu, Malaysia. "The RSC’s cessation will allow PETRONAS to minimize the project’s long-term value erosion and optimize the development and production activities in Malaysia, in line with its efforts to reduce costs and increase the efficiency of its operations," the state-owned firm said in the press release. PETRONAS will reimburse the balance of outstanding capital and operational expenditures to the contractors over the following 12 months following the RSC cessation that will take effect Sept. 30. Under the agreement, the contractors will transfer ownership of the Berantai FPSO (floating production, storage and offloading) facility to the NOC. http://www.rigzone.com/news/oil_gas/a/145560/PETRONAS_Reaches_Deal_with_SapuraKencana_Petrofac_for_Berantai
16 May 2016: Sarawak seeks to regulate Petronas activities within state - says Federal Government has no authority to issue licences
Sarawak seeks to regulate Petronas activities within state BY SULOK TAWIE June 15, 2016 -- Sarawak Chief Minister Tan Sri Adenan Satem announced today the state government’s plans to regulate the seabed and subsoil activities of national oil company Petronas and its contractors within its territory. He said Sarawak’s regulatory framework would be based on relevant state laws to which Petronas and its contractors would have to abide. “Petronas, a corporation having rights to prospect and mine petroleum both offshore and onshore under the Petroleum development Act, 1974, will have to be regulated and abide by the provisions of the Oil Mining Ordinance of Sarawak and the Land Code in regard to the use and occupation of State Land within the boundaries of Sarawak for the prospecting and mining of petroleum,” he said when winding up the debate in the state assembly here. He said the Land Code of Sarawak, which came into effect on January 1, 1959, defines “state land” to include the seabed and subsoil which forms part of the continental shelf by virtue of an Order made by the British Queen while Sarawak was still a Colony. “Article 73(b) of the Federal Constitution states that the state legislature may make laws for the whole or any part of the State. “Therefore, state laws like the Land Code, the Oil Mining Ordinance 1958 of Sarawak apply to the seabed and sub-soils in the continental shelf regardless of the character of the high seas above that area of the continental shelf....Adenan also said the state government does not agree to the extension of Continental Shelf Act and the Petroleum Mining Act to Sarawak, which purports to authorise the federal government to grant licences for the exploration and mining of petroleum in the Continental Shelf of Sarawak. “Therefore, Parliament has no constitutional authority to pass any legislation relating to the issuance of licences for the prospecting for oil or the oil mining leases within the boundaries of Sarawak which extend to the seabed and sub-soils in the Continental Shelf,” he added. - See more at: http://m.themalaymailonline.com/malaysia/article/sarawak-seeks-to-regulate-petronas-activities-within-state#sthash.DjzxLOl4.PfWk3WCC.dpuf
Petronas Bintulu LNG Complex, located approximately 20km from Bintulu Town, covers 276ha and currently accounts for 40.5% of Sarawak's gross export, 6% of Malaysia's total export and 4.2% of the country's GDP. It includes three LNG plants with eight LNG trains in total. The three plants are respectively owned and operated by Malaysia LNG, MLNG Dua and MLNG Tiga, in joint venture with Petronas. http://www.hydrocarbons-technology.com/projects/petronas-bintulu-lng-complex-sarawak/
First edition of the Offshore Malaysia Oil and Gas Activity Map to 2019
http://www.infield.com/news/offshore-malaysia-oil-gas-activity-map/77
http://www.slideshare.net/innovasjonnorge/2013-opportunities-og-sea-egil
Malaysia Oil and Gas Profile - » A Barrel Full Oil & Gas Wiki http://abarrelfull.wikidot.com/malaysia-oil-and-gas-profile
26 May 2016: Panama Canal upgrade to bring more gas to Asia
Panama Canal Fever Sweeps Globe Again as New Era in Trade Nears by Alex Nussbaum Naureen Malik May 25, 2016... As U.S. gas exports ramp up, new route will slash time to Asia. $5 billion project also shifts oil, crops, container trade....
http://www.bloomberg.com/news/articles/2016-05-25/panama-canal-fever-sweeps-globe-again-as-new-era-in-trade-nears?cmpid=BBD052516_BIZ&utm_medium=email&utm_source=newsletter&utm_campaign=
24 May 2016: Russian state oil firm may buy Petronas' assets, its earnings and assets impaired on lower oil prices, Canada project news and others
Russian state oil firm may buy Petronas' assets Published 23 May 2016 ..."Also, Zarubezhneft shows interest in studying the assets of Petronas. The parties are holding consultations about it," he is reported as saying on Friday by Russian news agency Tass. "As for Zarubezhneft, it is studying opportunities to undertake projects in Malaysia.... https://www.malaysiakini.com/news/342610
Malaysia’s Petronas Says Oil Prices to Continue Affect Earnings - National company posts 60% annual decline in profit By YANTOULTRA NGUI May 18, 2016 http://www.wsj.com/articles/malaysias-petronas-says-oil-prices-to-continue-affect-earnings-1463583213
Petronas’ Q1 profit down 60% on low product prices, asset impairment Posted on 19 May 2016 http://www.thesundaily.my/news/1807242
Petronas and ringgit volatility 21 May 2016 http://www.thestar.com.my/business/business-news/2016/05/21/petronas-and-ringgit-volatility-taking-on-a-challenge-king-koil-acquisition/
Petronas leaves May crude price factor unchanged at $4/bbl May 12, 2016 http://af.reuters.com/article/energyOilNews/idAFL3N1891BK
Others
PETRONAS' PLNG SATU Heads to Malaysia's Kanowit Gas Field Off Sarawak by Petroliam Nasional Berhad|Press Release|Wednesday, May 18 - See more at: http://www.rigzone.com/news/oil_gas/a/144575/PETRONAS_PLNG_SATU_Heads_to_Malaysias_Kanowit_Gas_Field_Off_Sarawak#sthash.Vhthum8U.dpuf
Petronas sails Satu PFLNG Anamaria Deduleasa 16 May 2016 http://www.upstreamonline.com/incoming/1432691/petronas-sails-satu-pflng
Petronas Turns to Jotun to Help "Substantially Cut Fuel Costs" May 18, 2016 http://shipandbunker.com/news/apac/291637-petronas-turns-to-jotun-to-help-substantially-cut-fuel-costs
Petronas, PetroVietnam extend contract for 10 more years 11/05/2016 http://english.vietnamnet.vn/fms/business/156327/petronas--petrovietnam-extend-contract-for-10-more-years.html
Petronas, PetroVietnam extend PSC for 10 more years 9 May 2016 http://www.thestar.com.my/business/business-news/2016/05/09/petronas-petrovietnam-extend-psc-for-10-more-years/
PETRONAS, PetroVietnam Extend PM3CAA PSC in Malaysia-Vietnam Waters to 2027 by Petroliam Nasional Berhad / Vietnam Oil & Gas Group|Press Release|Tuesday, May 10 - See more at: http://www.rigzone.com/news/oil_gas/a/144395/PETRONAS_PetroVietnam_Extend_PM3CAA_PSC_in_MalaysiaVietnam_Waters_to_2027#sthash.OYe2BGUD.dpuf
Petronas to conduct test at Bintulu plant 12 May 2016 http://www.thestar.com.my/metro/community/2016/05/12/petronas-to-conduct-test-at-bintulu-plant/
DNeX bags drilling equipment and services job from Petronas Carigali By Supriya Surendran / theedgemarkets.com | May 19, 2016 http://www.theedgemarkets.com/my/article/dnex-bags-drilling-equipment-and-services-job-petronas-carigali
On Canada project
Canada Set to Make Petronas LNG Decision as Early as Mid-Summer May 2, 2016 http://boereport.com/2016/05/02/canada-set-to-make-petronas-lng-decision-as-early-as-mid-summer/
Petronas names new president of Pacific NorthWest LNG BRENT JANG VANCOUVER — The Globe and Mail Published Apr. 29 http://www.theglobeandmail.com/report-on-business/industry-news/energy-and-resources/petronas-names-new-head-at-pacific-northwest-lng-to-oversee-bc-project/article29791565/
B.C. LNG: First Nations appeal to UN to help stop Petronas project - Scientists have raised concerns about the project slated for Lelu Island The Canadian Press Posted: May 12, 2016 http://www.cbc.ca/news/canada/british-columbia/b-c-lng-first-nations-appeal-to-un-to-help-stop-petronas-project-1.3579074
On RAPID project
PETRONAS Signs Contracts For Pengerang Petrochemical Plants May 11 http://www.bernama.com.my/bernama/v8/newsindex.php?id=1244624
AP: Malaysia – Petronas seeking new RAPID partner 13 May 2016 http://www.pfie.com/ap-malaysia-petronas-seeking-new-rapid-partner/21247242.article
On Petronas Gas
Get set for competitive prices thanks to Gas Supply Bill 2016 BY FERNANDO FONG - 23 MAY 2016 Read More : http://www.nst.com.my/news/2016/05/147384/get-set-competitive-prices-thanks-gas-supply-bill-2016
Petronas Gas sets RM4.5bil capital expenditure over five years 27 April 2016 http://www.thestar.com.my/business/business-news/2016/04/27/petgas-sets-rm45bil-capex-over-five-years/
Petronas Gas set aside RM4.5b capex over next 5 years 26 April 2016 http://www.thesundaily.my/news/1779161
On MISC
Profit up at Petronas unit, weak tanker price clouds prospects May 9, 2016 http://asia.nikkei.com/Business/Companies/Profit-up-at-Petronas-unit-weak-tanker-price-clouds-prospects
Petronas unit to buy remainder 50% in joint venture to boost tanker fleet in International Shipping News 26/04/2016 http://www.hellenicshippingnews.com/petronas-unit-to-buy-remainder-50-in-joint-venture-to-boost-tanker-fleet/
15 Apr 2016: Petronas to slash capex for Canadian LNG project - to US$500 million over the next 2 years from the initial US$5 billion planned over the next 3 years
Petronas to slash capex for Canadian LNG project - report By Meena Lakshana / theedgemarkets.com | April 14, 2016 KUALA LUMPUR (April 14): National oil firm Petroliam National Bhd's (Petronas) unit Progress Energy Ltd is significantly slashing its capital expenditure (capex) in the US$36 billion Pacific Northwest liquefied natural gas (LNG) project in northern British Columbia while awaiting a final approval from the Canadian government's environmental agency. According to a report by Canada-based Financial Post, Progress president and chief executive officer Michael Culbert said the company is reducing its investment to US$500 million over the next two years from the initial US$5 billion planned over the next three years.
Petronas slashes spending as it awaits decision on B.C. liquefied natural gas project by Yadullah Hussain | April 13, 2016 http://business.financialpost.com/news/energy/petronas-slashes-spending-as-it-awaits-decision-on-b-c-liquefied-natural-gas-project?__lsa=924a-f026
13 Mar 2016: Petronas keeping eye on Candada project EIA process, Mahathir fired as Adviser to Petronas
Petronas keeping a close eye on Canada’s environmental impact assessment process By Dispatch Staff - March 12, 2016, Just when Petronas, through its subsidiary Pacific NorthWest LNG, and its partners were in the final stages of an investment decision, the new federal Liberal government in Canada is toughening up environmental reviews of major energy projects. This is a step in the direction of regaining “public trust” and to meet with the emission reduction pledge that the government made at the Paris conference last year. The government said in January that major energy projects would be subject to additional assessment on “direct and upstream greenhouse gas emissions” and this is something that spells uncertainty over the $36 billion LNG project says Petronas. Malaysia’s state-owned company has already spent an estimated $12 billion to get its LNG project to this stage and with new assessment, the project which has already suffered from multiple delays, will get delayed again and because of this Petronas has conveyed to federal cabinet ministers it won’t accept additional hurdles.... http://www.dispatchtribunal.com/petronas-keeping-a-close-eye-on-canadas-environmental-impact-assessment-process/17617/
Petronas to mature Canadian project BY TEE LIN SAY 10 March 2016; PETALING JAYA: Petroliam Nasional Bhd (Petronas) via subsidiary Pacific NorthWest LNG (PNW LNG) is proactively taking steps to mature the US$36bil (RM147bil) Pacific NorthWest liquefied natural gas (LNG) project in Canada towards its final investment decision, the national oil company said in a statement. This was in response to recent press reports which said that Petronas was close to pulling out of the project, following frustrations with the stance of Prime Minister Justin Trudeau’s climate-change priorities and the introduction of new uncertainties for the project. The new federal Liberal government in Canada is toughening up environmental reviews of major energy projects as it strives to meet international commitments to reduce greenhouse gas emissions.... A Canadian newspaper had quoted sources as saying that Petronas was threatening to walk away if it didn’t get federal approval by March 31.... http://www.thestar.com.my/business/business-news/2016/03/10/petronas-to-mature-canadian-project/
Malaysia Fires Former Leader Mahathir as Adviser to Petronas - Government cites former prime minister’s alliance with the opposition By YANTOULTRA NGUI March 11, 2016 KUALA LUMPUR, Malaysia—Former leader Mahathir Mohamad was terminated on Friday as an adviser to state oil firm Petroliam Nasional Bhd., or Petronas, over his alliance with the opposition, which is demanding the resignation of embattled Prime Minister Najib Razak. The prime minister’s office said in a statement that Mr. Najib’s cabinet has agreed unanimously to terminate Dr. Mahathir’s service... http://www.wsj.com/articles/malaysia-fires-former-leader-mahathir-as-adviser-to-petronas-1457707460
Mahathir Mohamad wins jailed Anwar Ibrahim's backing in bit to oust Malaysian PM Najib Razak March 4, 2016 by Lindsay Murdoch Bangkok: Malaysia's jailed opposition leader Anwar Ibrahim has declared support for his arch-nemesis Mahathir Mohamad in efforts to topple embattled Prime Minister Najib Razak. Mr Anwar said Mr Najib has "wreaked havoc" in the country with "the most severe scandal" in Malaysia's history... Former Malaysian prime minister Mahathir Mohamad in his office in Kuala Lumpur last week....
Former Malaysian prime minister Mahathir Mohamad in his office in Kuala Lumpur last week. Photo: Bloomberg... http://www.smh.com.au/world/mahathir-mohamad-wins-jailed-anwar-ibrahims-backing-in-bit-to-oust-malaysian-pm-najib-razak-20160303-gnabf8.html#ixzz42nKqYZzu
2 Mar 2016: Petronas to cut 1,000 jobs or less than 2%, expenditure cut of up to RM20 billion in 2016 to affect raft of Malaysia O&G players
The Edge reports: 1,000 job cuts affects less than 2% of the Petronas work force. It has over 50,000 staff at end 2014, up from 39,000 in 2009. Staff costs were almost RM10 billion at end 2014,average cost per employee was RM188,000. Key positions also shift as CEO Wan Zulkiflee appoints new upstream and technology & engineering heads.
source: screen shot of The Edge article, http://tefd.theedgemarkets.com/2016/TEP/20160302zgy9pl.pdf
3 Feb 2016: ExxonMobil sees 2015 earnings fall 50%, cuts 2016 spending by 25%
ExxonMobil sees 2015 earnings fall 50%, cuts 2016 spending by 25%; ExxonMobil Corp. plans to reduce its capital and exploration expenditures in 2016 by 25% compared with that of 2015 to $23.2 billion. The company estimates earnings in 2015 totaled $16.2 billion, a 50% drop from the $32.5 billion earned in 2014. Capital and exploration expenditures were $31.1 billion, down 19% from the 2014 level.
http://www.ogj.com/articles/2016/02/exxonmobil-sees-2015-earnings-fall-50-cuts-2016-spending-by-25.html?
26 Jan 2016: Petronas, Pertamina, PTT, ONGC retain sovereign ratings while S&P downgrades others including Sinopec and CNOOC
S&P downgrades Asia Pacific energy firms, Petronas not affected 26 January 2016; We don't believe China's national oil companies will be able to stabilise their cash flow adequacy amid the current price environment, despite their efforts to cut capital expenditure and costs," the agency said. The company said it had therefore lowered its credit profile for companies, including China Petroleum & Chemical Corp and China National Offshore Oil Corp (CNOOC) in China and for Woodside Petroleum and Santos in Australia. However, S&P said the revised oil price outlook had no impact on the ratings and outlooks on national oil companies in South and Southeast Asia, such as Indonesia's PT Pertamina, Malaysia's Petroliam Nasional (Petronas), Thailand's PTT Public or India's Oil and Natural Gas Corp (ONGC). "The companies all have an important policy role as major energy suppliers and providers in their respective countries... Therefore, the ratings and outlook on these four companies remain the same as those on their respective sovereigns." The Standard & Poor's reviews come days after competing rating agency Moody's put 175 commodity firms, including in Asia, on review over a bleak outlook - See more at: http://www.themalaysianinsider.com/malaysia/article/sp-downgrades-asia-pacific-energy-firms-petronas-not-affected#sthash.NHfnbGms.dpuf
12 Jan 2016: Bloomberg - Petronas Sees Three More Tough Years in `Unsettling Environment,' mulls $30 oil for 2016 (two months ago, assumed $48 for 2016)
Note: This is a still not a major Petronas news update, but an ad hoc one.
- Petronas also in recent Malaysia news alerts on cuts to contract workers in 2016. Shell Malaysia reported in local news to have cut about 1,300 jobs in 2015. Jobs loss outlook for 2016 worse than some 20,000 lost in 2015 in Malaysia. Other 2015 job cuts include Malaysia Airlines -6,000, RHB Bank -2,700, CIMB Bank -3,600, Standard Chartered -3,600 from The Malaysian Insider compilation from 2015 news.
- The recent price drop from around $38 toward $31 may highlight these major producers by cost: United States $36.20, Norway $36.10, Angola $35.40, Colombia $35.30, Nigeria$31.60. See diagram below.
- Certainly also issues for POGO food-fuel price spread re. biodiesel.
- China GDP and oil demand is eyed, and into the future, car makers start to worry about tech disruption to their industry.
Source: What it costs to produce oil By Alanna Petroff and Tal Yellin / CNNMoney - The collapse in the price of oil has squeezed energy companies and countries that were betting on higher returns. Here’s what it costs on average to pump a barrel of oil in the 20 biggest oil producing nations. http://money.cnn.com/interactive/economy/the-cost-to-produce-a-barrel-of-oil/index.html?iid=EL.
Oil tumbles nearly 5 percent to new lows; analysts warn of $20s - A brutal new year selloff in oil markets deepened on Monday, with prices plunging as much as 5 percent to new 12-year lows as further ructions in the Chinese stock market threatened to knock crude into the $20s. http://uk.reuters.com/article/idUKKCN0UP01T20160111
Petronas Sees Three More Tough Years in `Unsettling Environment' by Elffie Chew January 12, 2016; Crude oil may average $30/barrel in low-price scenario. Company plans to keep 60-70 billion ringgit annual capex.... Petroliam Nasional Bhd. said crude prices could average $30 a barrel this year and warned the Malaysian state oil company faces two to three tough years.Just two months after the company was assuming an average price of $48 a barrel, Chief Executive Officer Wan Zulkiflee Wan Ariffin laid out the new "low-price" scenario for 2016. Petronas remains committed to its multi-billion dollar projects as it sticks to its capital expenditure plan of as much as 350 billion ringgit ($80 billion) over the next five years, he said Monday.... The drop in oil has in part led to international investors souring on Malaysia, with the ringgit slumping to a 17-year low in 2015. The net-oil exporting nation stands to lose 300 million ringgit for every $1 a barrel decline in crude, according to government estimates. Brent currently trades below $32 a barrel.Moody Investors Service lowered its credit-rating outlook for Malaysia on Monday, citing an external environment that has crimped government revenue despite Prime Minister Najib Razak’s efforts to improve the country’s finances. Najib said last week he will amendthe 2016 budget to take into account the lower price of oil after using the same price assumption that Petronas did....."The reversal in the price will happen," Wan Zulkiflee said. "It’s only whether it will happen in three years, five years or in seven years’ time.".... The slowing Chinese economy and its weakening yuan are having an impact on Petronas’ sales and operations in the North Asian nation, Wan Zulkiflee said.....In Canada, Petronas is still awaiting environmental approval from regulators to start construction on the Pacific NorthWest LNG project....The company will review its decision within this quarter on whether to proceed .... Wan Zulkiflee said the company will continue to maintain its production levels as significant cuts would result in setbacks when there is a recovery. Petronas hasn’t gotten to the point where it needs to "right-size" permanent employees even as it reviews the status of contract workers, he said. .....Spending Cuts - It’s also lowering spending by improving on procurement processes and cutting costs on business travel that saved the company 24 percent in operating expenditure excluding salaries last year, Wan Zulkiflee said....... It’s still committed to paying the government 16 billion ringgit in dividends this year, down from 26 billion ringgit in 2015... http://www.bloomberg.com/news/articles/2016-01-11/petronas-sees-three-more-tough-years-in-unsettling-environment-
Oil Extends Losses From 12-Year Low as Stockpiles Seen Expanding by Ben Sharples January 12, 2016, Inventories probably rose 2 million barrels last week: survey, Iran to starting selling new oil grade before boosting exports... http://www.bloomberg.com/news/articles/2016-01-11/oil-extends-decline-from-12-year-low-as-stockpiles-seen-rising
China's Demand for Crude is Showing Signs of Cracking - Resilient supply isn't the only problem for crude. by Luke Kawa, January 11, 2016; http://www.bloomberg.com/news/articles/2016-01-11/china-s-demand-for-crude-is-showing-signs-of-cracking
The End of the Monetary Illusion Magnifies Shocks for Markets by Simon Kennedy January 8, 2016; Central banks no longer have as much room to deliver stimulus. HSBC says currencies most sensitive to policy in 15 years... Central bankers are no longer the circuit breakers for financial markets. Monetary-policy makers, market saviors the past decade through the promise of interest-rate reductions or asset purchases, now lack the space to cut further -- if at all -- or buy more. Even those willing to intensify their efforts increasingly doubt the potency of such policies. That’s leaving investors having to cope alone with shocks such as this week’s rout in China or when economic data disappoint, magnifying the impact of such events....http://www.bloomberg.com/news/articles/2016-01-08/the-end-of-the-monetary-illusion-magnifies-shocks-for-markets
The driverless, car-sharing road ahead - Carmakers increasingly fret that their industry is on the brink of huge disruption Jan 9th 2016; ...Now, Mr Fields is talking about autonomous cars being ready to roll by 2020. More conservative car bosses add five years.... Barclays, another bank, forecasts that the fully driverless vehicle will result in the average American household cutting its car ownership from 2.1 vehicles now to 1.2 by 2040.... The 11m or so annual sales of mass-market cars for personal ownership in America may be replaced by 3.8m sales of self-driving cars, either personally owned or part of taxi fleets, Barclays thinks....http://www.economist.com/news/business/21685459-carmakers-increasingly-fret-their-industry-brink-huge-disruption?cid1=cust/noenew/n/n/n/20160111n/owned/n/n/nwl/n/n/n/email
4 Jan 2016: Pressure to cut domestic O&G jobs after expatriates sent packing? Big oil to cut investment again in 2016.
Editor's note: Over the weekend, chatted with some O&G people who report that PETRONAS under pressure from its foreign creditors on why it is not cutting more domestic jobs. O&G expatriate job cuts already impacting the KL rental property markets. **This is a short update only, I shall do a major PETRONAS news review for 14 Nov to end December soon.
Big oil to cut investment again in 2016 By Karolin Schaps and Ron Bousso Jan 3, 2016; At around $37 a barrel, crude prices are well below the $60 firms such as Total (TOTF.PA), Statoil STO.OL and BP (BP.L) need to balance their books, a level that has already been sharply reduced over the past 18 months. International oil companies are once again being forced to cut spending, sell assets, shed jobs and delay projects as the oil slump shows no sign of recovery. U.S. producers Chevron (CVX.N) and ConocoPhillips (COP.N) have published plans to slash their 2016 budgets by a quarter. Royal Dutch Shell (RDSa.L) has also announced a further $5 billion in spending cuts if its planned takeover of BG Group (BG.L) goes ahead. http://uk.reuters.com/article/uk-oil-companies-investments-idUKKBN0UH0AG20160103
14 December 2015, from The Edge Malaysia on loss of jobs by O&G expatriates impacting KL high-end property rentals.
14 Nov 2015: PETRONAS 3Q2015 net profit plunges, capex plans continue, dividend cut, Canada project hurdles, RAPID on track
Petronas Q3 net profit tumbles 91% on weak oil prices Published: 11 November 2015 http://www.themalaysianinsider.com/business/article/petronas-q3-net-profit-tumbles-91-on-weak-oil-prices#sthash.CA7S0JwR.dpuf
Petronas slashes 2016 dividend as earnings plummet Published: 12 November 2015 http://www.themalaysianinsider.com/business/article/petronas-slashes-2016-dividend-as-earnings-plummet#sthash.ExUzppFO.dpuf
Malaysia's Petronas says committed to capex plans despite continuing challenges (Platts)-- 12 Nov 2015 * January-September capex up 5.5% on year at $11.42 billion * Q3 oil, gas production rises 4.8% on year * Progress of RAPID project on track Malaysia's state-owned Petronas remained committed to its capital expenditure plans even though it anticipated continuing challenges due to bearish market sentiment, CEO Wan Zulkiflee Wan Ariffin said Wednesday. The projects that the company will focus its capital investment on include the Refinery And Petrochemical Integrated Development project in the southern Johor state; the Pacific North West LNG Project in Canada; LNG Train 9 in Bintulu; and the two floating LNG projects being constructed in South Korea. "These capex projects are investments for the long term, and we are set on seeing them through successfully to ensure Petronas' sustainability well into the future," Wan Zulkiflee said in a statement while announcing the company's Q3 2015 results. http://www.platts.com/latest-news/natural-gas/singapore/malaysias-petronas-says-committed-to-capex-plans-26275638
Government will not revise Budget 2016 despite Petronas’ lower dividend, says deputy finance minister Friday November 13, 2015 - See more at: http://www.themalaymailonline.com/malaysia/article/government-will-not-revise-budget-2016-despite-petronas-lower-dividend-says#sthash.jiRcOwDD.dpuf
PETRONAS Not Laying Off Permanent Staff Despite Current Market Gloom by Chee Yew Cheang Rigzone Staff Thursday, November 12, 2015- See more at: http://www.rigzone.com/news/oil_gas/a/141580/PETRONAS_Not_Laying_Off_Permanent_Staff_Despite_Current_Market_Gloom#sthash.lu12aOx0.dpuf
Canadian indigenous, environmental groups urge Trudeau to reject Petronas project Published: 12 November 2015 http://www.themalaysianinsider.com/malaysia/article/canadian-indigenous-environmental-groups-urge-trudeau-to-reject-petronas-pr#sthash.KyvnVLWa.dpuf
Another hurdle to Petronas’ project in Canada 11 November 2015; Over 70 Northern British Columbia indigenous leaders, environmental organisations, scientists, businesses, unions, university groups, and faith groups from across the province have signed on to a letter written by Lax Kw’alaams hereditary chief Yahaan (Donnie Wesley) calling on Prime Minister Justin Trudeau and Environment Minister Catherine McKenna to reject the PNW LNG plant proposed for Lelu Island and Flora Bank. They also want ongoing test-drilling at the site to be cancelled. The final Canadian Environmental Assessment Agency (CEAA) decision, expected by early 2016 though possibly sooner, is the final major regulatory hurdle the project must overcome to move ahead. http://www.thestar.com.my/Business/Business-News/2015/11/11/Another-hurdle-to-Petronas-project-in-Canada/?style=biz
PETRONAS Celebrates First Production at Bukit Tua, Kepodang Fields by Petroliam Nasional Berhad Press Release November 05, 2015 http://www.rigzone.com/news/oil_gas/a/141450/PETRONAS_Celebrates_First_Production_at_Bukit_Tua_Kepodang_Fields#sthash.56HKH1ex.dpuf
Petronas Unit Allocates Up to $300m for Indonesian Oil Fields Next Year By : Retno Ayuningtyas November 09, 2015; A unit of Malaysian energy giant Petronas plans to invest $200 million to $300 million next year on developing its oil blocks in Indonesia, an executive says. Hazli Sham Kassim, Petronas Carigali’s general manager and head of Indonesian operations, said the company would wrap up production at the Bukit Tua field in Ketapang, East Java, and begin exploration activities in the North Madura II block in offshore East Java in 2016. http://jakartaglobe.beritasatu.com/business/petronas-unit-allocates-300m-indonesian-oil-fields-next-year/
OMV, Petronas launch oil talks with Iran TEHRAN, Nov. 11 (MNA) – Describing the latest status of negotiations with Malaysia’s Petronas and Austria’s OMV oil companies, managing director of ICOFC announced several Russian firms’ willingness to invest in Iran’s central oil fields. http://en.mehrnews.com/news/111869/OMV-Petronas-launch-oil-talks-with-Iran
PETRONAS FLNG2 Reaches Milestone with Keel Laying at SHI's Shipyard by Petroliam Nasional Berhad Press Release Monday, November 09, 20- See more at: http://www.rigzone.com/news/oil_gas/a/141503/PETRONAS_FLNG2_Reaches_Milestone_with_Keel_Laying_at_SHIs_Shipyard#sthash.xyqjLvVH.dpuf
Petronas floating LNG2 to commission in 2018 Posted on 9 November 2015 http://www.thesundaily.my/news/1606223
WCT bags RM315.6 million Petronas EPCC job Posted on 13 November 2015 -http://www.thesundaily.my/news/1609929
Petronas Dagangan aims to sustain financial results 9 November 2015 http://www.thestar.com.my/Business/Business-News/2015/11/09/Petronas-Dagangan-aims-to-sustain-financial-results/?style=biz
Total, Petronas keep eye out for acquisitions as prices pressure oil players October 18, 2015 http://www.smh.com.au/business/energy/total-petronas-keep-eye-out-for-acquisitions-as-prices-pressure-oil-players-20151017-gkbu4o.html#ixzz3rO6CuZ9j
Icon Offshore appoints Petronas top exec Amir as new MD 3 November 2015 http://www.thestar.com.my/Business/Business-News/2015/11/03/Icon-appoints-Petronas-top-exec-Amir-as-new-MD/?style=biz
MISC-Bumi Armada FPSO business merger could create huge Petronas subsidary by By Vincent Wee Malaysian shipping company MISC and oil and gas services provider Bumi Armada, both relatively big players in their respective fields, are reportedly in early stages of exploring a corporate exercise involving the consolidation of the floating production storage offshore (FPSO) businesses of both companies, local reports cited sources as saying. According to them, the exercise could see MISC inject its FPSO businesses into Bumi Armada in return for shares, a move that could see Petronas' shipping unit ending up with a big stake in Bumi Armada http://www.seatrade-maritime.com/news/asia/misc-bumi-armada-fpso-business-merger-could-create-huge-petronas-subsidary.html
Lawas natives yet to see a single sen over Petronas gas pipeline BY SHERIDAN MAHAVERA 29 October 2015, Lun Bawang landowners in Kampung Long Luping said they have either been partially paid or not at all for land taken for the pipeline, which made the news last year after a section of it blew up. Sakai Libang, 54, said the problem was not Petronas but the Land and Survey Department http://www.themalaysianinsider.com/malaysia/article/lawas-natives-yet-to-see-a-single-sen-over-petronas-gas-pipeline#sthash.6jD8YEjH.dpuf
11 October 2015: Petronas mostly ‘exempted’ from TPP, quit Mauritania, mulling TAP Project, analysts doubt Canada project, credit and rating
Khazanah, Petronas mostly ‘exempted’ from TPP, says minister Published: 7 October 2015 8:56 PM - See more at:
http://www.themalaysianinsider.com/malaysia/article/malaysia-state-fund-petronas-mostly-exempted-from-tpp-says-minister#sthash.pZ9XE5yZ.dpuf
Petronas Renews Pledge to Export Canadian Gas as Analysts Doubt by Rebecca Penty October 9, 2015 — 7:24 AM HKT. Malaysian energy company says proceeding depends on approvals. Executive vice president dismisses energy market volatility.... Analysts have cast doubt on Canada’s ability to deliver LNG export projects this decade. The global market is entering a period of oversupply, with ventures starting up in Australia and the U.S., and demand is slowing in Asia just as the oil slump has taken down prices for LNG. There are 20 projects under consideration for export from the Pacific Coast in British Columbia and none have started construction.... Canada and East Africa are “last to the LNG party” globally behind the U.S. and Australia, according to CIBC World Markets commodities strategist Katherine Spector. Plunging oil prices mean only about 6 billion cubic feet (170 million cubic meters) a day of LNG exports will be developed in North America by 2022, Spector wrote in a report this week, about half the amount she had forecast last year would be online by 2020.... Petronas in June said it would proceed with the Pacific NorthWest LNG project, pending outstanding approvals, becoming the only Canadian proposal to issue an investment decision to date. Other owners of the venture are Indian Oil Corp., Japan Petroleum Exploration Co., China Petroleum & Chemical Corp. and Brunei National Petroleum Co.
http://www.bloomberg.com/news/articles/2015-10-08/petronas-renews-pledge-to-export-canadian-gas-as-analysts-doubt
Petronas quitting Mauritania on revenue, oil price fall Published: 7 October 2015 4:06 PM - See more at:
http://www.themalaysianinsider.com/business/article/petronas-quitting-mauritania-on-revenue-oil-price-fall#sthash.DqlwsV0S.dpuf
Petronas Said to Mull Buying Statoil’s Stake in TAP Project by Ercan Ersoy and Elffie Chew September 2, 2015 — 1:16 AM HKTUpdated on September 2, 2015 — 8:28 PM HKT
http://www.bloomberg.com/news/articles/2015-09-01/petronas-said-to-consider-buying-statoil-s-stake-in-tap-project
Adding on older news items of interest
UPDATE 1-Malaysia's Petronas to delay RAPID'S refinery start-up to mid-2019 May 18, 2015, * Weak commodity prices prompt review, re-bidding of EPC contracts * Petrochemical chains also rephased due to weak oil prices...
http://www.reuters.com/article/2015/05/18/asia-oil-petronas-idUSL3N0Y924T20150518
The Yuan Drop Just Added $14 Billion to Asia Inc.’s Debt Burden by Christopher Langner, David Yong and Lianting Tu August 13, 2015 — 2:43 PM HKT; ... The extra yield over Treasuries investors demand to hold the 10-year 5.25 percent dollar bonds of state-owned oil company Petroliam Nasional Bhd. -- among Malaysia’s most liquid notes -- has risen 11 basis points this week to the highest since March. “We’re especially worried about Malaysia as its currency faces the most stress after the yuan devaluation,” said Gordon Tsui, the head of fixed income at Taikang Asset Management (Hong Kong) Co
ASIA CREDIT CLOSE: Petronas takes advantage of improving risk appetite HONG KONG, Aug 5 (IFR) - Petronas saw its bonds tighten as an improvement in risk appetite drove investors to buy into the long-end of the curve. The Petronas 2025s and 2045s tightened around 5bp, according to a Hong Kong-based trader, who put it down to investors taking advantage of an overnight rise in 10-year US Treasury yields....
http://www.reuters.com/article/2015/08/05/markets-asia-debt-idUSL3N10G3AD20150805
Fitch Revises PETRONAS' Outlook to Stable; Affirms 'A' IDR Jul 1, 2015 2:38am EDT
http://www.reuters.com/article/2015/07/01/idUSFit92745720150701
British Columbia Sees $7.1 Billion From Petronas Gas Exports July 7, 2015 — 6:11 AM HKTUpdated on July 7, 2015 — 7:12 AM HKT British Columbia is pledging to cap levies on Petroliam Nasional Bhd.’s natural gas export project as it expects to collect C$9 billion ($7.1 billion) from the venture by 2030. Canada’s westernmost province must compensate the Malaysian oil producer, known as Petronas, and its partners if it adds costs through changes to certain taxes or credits over the next 25 years, according to terms of an agreement signed May 20 that were released Monday. “The revenue opportunities are significant,” British Columbia Finance Minister Michael de Jong said in a briefing with reporters Monday.....
http://www.bloomberg.com/news/articles/2015-07-06/british-columbia-sees-7-1-billion-take-from-petronas-gas-export
We only produce the oil, Putrajaya sets price, says Petronas chairman Published: 2 July 2015 8:51 AM - See more at:
http://www.themalaysianinsider.com/malaysia/article/we-only-produce-the-oil-putrajaya-sets-price-says-petronas-chairman#sthash.8DtLxS2L.dpuf
South Sudan Fighting Escalates in Oil States Before Peace Talks by Okech Francis June 6, 2015 — 10:46 PM HKT
http://www.bloomberg.com/news/articles/2015-06-06/south-sudan-fighting-escalates-in-oil-states-before-peace-talks
South Sudan Oil Field Becomes Battleground as Economy Reels by Ilya Gridneff May 26, 2015 — 5:00 AM HKT
http://www.bloomberg.com/news/articles/2015-05-25/south-sudan-oil-field-becomes-key-battleground-as-economy-reels
MMC Corp appoints former Petronas president Shamsul as chairman Published: 6 July 2015 7:42 PM - See more at:
http://www.themalaysianinsider.com/business/article/mmc-corp-appoints-former-petronas-president-shamsul-as-chairman#sthash.M7lQbRD8.dpuf
19 August 2015: PETRONAS slashes rig count to 14 from 39 and operating cashflow woes requires use of cash reserves, Irish probe tanks, environmental doubts on BC LNG project, US starts talks on South Sudan sanctions
On recent earnings and rig count slash, worries of Malaysia contractors
Petronas Irish probe tanks Written by OE Staff Friday, 14 August 2015 02:26 Petronas subsidiary PSE Seven Heads' Midleton well offshore Ireland has failed to discover commercial quantities of gas, according to partner Landsdowne Oil & Gas. http://www.oedigital.com/component/k2/item/10031-petronas-irish-probe-tanks
On BC project
- Malaysia scandal dampens hopes for Petronas LNG Project in BC published by Asianpost on Wed, 08/12/2015 - 08:56 By Ng Weng Hoong New Canadian Media Special to The Post British Columbia Finance Minister Mike de Jong’s recent visit to Malaysia yielded a Facebook photo-op with Prime Minister Najib Abdul Razak and a misreported story that state energy firm Petronas and its five Asian partners would begin construction of their US$36 billion liquefied natural gas (LNG) project in northern BC this September. In the reporting of de Jong’s press conference, Malaysian news agency Bernama did not make clear that the project must first receive Ottawa’s environmental approval, due sometime between September and December, before the Petronas-led Pacific NorthWest (PNW) LNG – not the British Columbia government – can make its final investment decision http://www.asianpacificpost.com/article/7085-malaysia-scandal-dampens-hopes-petronas-lng-project-bc.html
- Petronas LNG terminal set in salmon's 'Grand Central Station' - New data shows LNG terminal in middle of nursery for 40 salmon populations CBC News Posted: Aug 07, 2015 3:22 PM PT| Last Updated: Aug 08, 2015 2:13 PM PT http://www.cbc.ca/news/canada/british-columbia/petronas-lng-terminal-set-in-salmon-s-grand-central-station-1.3181203
On South Sudan
- South Sudan: Sides trade accusations after deal falters 3 hours ago; Rebels have accused South Sudan's government of resuming military attacks, a day after President Salva Kiir failed to sign a peace deal aimed at ending the civil war. Rebel leader Riek Machar said the government had chosen war over peace. But Mr Kiir's chief negotiator said the deal was a sell-out that could not be implemented as the rebels are split.... http://www.bbc.com/news/world-africa-33982009
- US Pursues New UN Sanctions on South Sudan as Deal Unsigned By THE ASSOCIATED PRESSAUG. 18, 2015, 6:08 P.M. E.D.T. UNITED NATIONS — The United States has begun talks at the United Nations to sanction South Sudan if its government doesn't sign a peace deal with rebels within 15 days and all sides in the conflict don't promptly implement a cease-fire, President Barack Obama's national security adviser said Tuesday. http://www.nytimes.com/aponline/2015/08/18/world/africa/ap-un-united-nations-south-sudan.html?_r=0
- South Sudan economy 'in intensive care' as famine looms By James Copnall BBC South Sudan analyst 10 July 2014 http://www.bbc.com/news/business-28225098
23 June 2015:
PETRONAS C$36 billion gas project faces dissent and low prices, with several LNG startups oversupply / glut until 2020-2025, Axens to provide processing technology for naptha at PETRONAS RAPID, PSE Seven Heads agrees contract for Irish drilling
Petronas Canada Gas Bet No Cinch as Dissent Adds to Low Prices by Rebecca Pentyand Allison McNeely June 22, 2015 — 10:04 PM HKT; Petroliam Nasional Bhd.’s C$36 billion ($29.4 billion) Canadian natural gas export project was treading water after the global market for the fuel weakened. Now local opposition is adding a new hurdle. A British Columbia aboriginal group that claims title to land earmarked for the liquefied natural gas terminal says it will take legal action if its environmental concerns aren’t addressed. That follows a decision by Petronas, as the Malaysian company is known, and investors earlier this month to press ahead with the Pacific NorthWest LNG terminal. The Lax Kw’alaams band, which has already turned down C$1.15 billion in compensation, says the terminal is slated for a culturally significant island and would damage salmon habitat, Deputy Mayor Stan Dennis said in an interview. In October, then-Petronas Chief Executive Officer Shamsul Azhar Abbas said the project needs to stay on schedule and begin shipments in 2019 or face a deferral of 10 to 15 years, until another market window opens. “One of the key risks is potential for delay,” said Tom Isaac, a partner at Osler, Hoskin & Harcourt LLP in Calgary who leads the firm’s aboriginal law group and has no stake in the project. “If litigation were initiated, that could take some time to wind its way through the courts.” Several planned LNG project startups this decade means buyers will be oversupplied until at least 2020. About 40 percent of respondents to a recent Bloomberg Intelligence survey said the glut may last until 2025, analysts led by Elchin Mammadov said in a June 16 presentation. Australia and Canada have the most expensive LNG projects in the world to develop, and some will be shelved or canceled, the analysts said....
http://www.bloomberg.com/news/articles/2015-06-22/petronas-canada-gas-bet-no-cinch-as-dissent-adds-to-low-prices
Malaysia’s Petronas to Build Natural-Gas Plant in British Columbia - Plan paves the way for export of cheap North American gas to Asia, By Chester Dawson June 12, 2015 1:53 a.m. ET
CALGARY—Malaysia’s state-owned energy company Thursday said it would build a large-scale natural-gas plant on Canada’s Pacific coast, paving the way for the export of cheap North American gas to high-demand markets in Asia. The 36 billion-Canadian-dollar (US$29.3 billion) project, known as Pacific NorthWest LNG, marks Canada’s emergence as a hub for exporting surplus North American natural gas to Asia. It is the first of nearly two...
http://www.wsj.com/articles/malaysias-petronas-to-build-natural-gas-plant-in-british-columbia-1434088430
PETRONAS selects Axens Technologies for Malaysia’s RAPID project Monday, Jun 22, 2015
Petroliam Nasional Berhad (PETRONAS), Malaysia’s national oil and gas company has selected Axens as a technology provider for PETRONAS’ Refinery and Petrochemicals Integrated Development (RAPID) project located in Pengerang, Johor, Malaysia..... RAPID is estimated to cost US$16 billion while the associated facilities will involve an investment of about US$11 billion. PIC is poised for its refinery start-up by early 2019.... Axens was initially selected in October 2010 for a Detailed Feasibility Study, after which their technologies were selected following an open bid in January 2012 on the basis of the best NPV (Net Present Value), as well as proven long term operating experiences supported by the technology and catalyst’s specific features; hence providing additional benefits to the project. The following technologies from Axens was selected for the RAPID project:
•Naphtha Hydrotreating (NHT), this process purifies naphtha removing dienes, olefins compounds, sulfur and nitrogen species with a feed capacity of 21,000 BPSD; •OctanizingTM a continuous catalytic regenerative (CCR) reforming process for maximizing the production of reformate from heavy hydrotreated naphtha , with a feed capacity of this unit 14,000 BPSD.........
http://www.youroilandgasnews.com/petronas+selects+axens+technologies+for+malaysia%E2%80%99s+rapid+project_117941.html
Petronas inks rig for Irish drilling Written by Elaine Maslin Monday, 22 June 2015 03:59; Petronas subsidiary PSE Seven Heads has agreed a contract to drill on the Midleton prospect offshore Ireland starting in August, according to partner Lansdowne Oil & Gas. PSE Seven Heads, a subsidiary of Petronas' PSE Kinsale Energy will use Diamond Offshore Drilling's Ocean Guardian semisubmersible drilling rig to drill the well, in SEL 4/07, which covers part-blocks 49/11, 49/12, 49/17 and 49/18, immediately southeast of the Kinsale Head gas field, in the Celtic Sea offshore southeast Ireland. The Midleton prospect, about 20km northeast of the Kinsale Head field, has been estimated to contain 330 Bcf gas initially in place, according to Landsdowne....
http://www.oedigital.com/component/k2/item/9484-petronas-inks-rig-for-irish-drilling
10 June 2015:
Opinion: Uncertainty grows over LNG deal - ‘Conditional’ final investment decision expected from Petronas by June; Tanjung Offshore secures RM250m contract from Petronas Carigali
Opinion: Uncertainty grows over LNG deal - ‘Conditional’ final investment decision expected from Petronas by June BY NG WENG HOONG, SPECIAL TO THE VANCOUVER SUN JUNE 5, 2015; The sobering reality is the project faces greater barriers and more uncertainties than a year ago when Zulkiflee’s predecessor, Shamsul Azhar Abbas, began to grasp the magnitude of his over-reach to develop natural gas reserves, pipelines and a large LNG terminal in B.C. all within five years. Company insiders confirmed they had underestimated the extent of environmental and First Nations opposition to fracking, and oil and gas pipeline projects in B.C. Also, like most in the industry, they had not anticipated the crippling effects of the oil price collapse. Political developments in Malaysia and China could add a few more black swans to halt the project’s progress.....Shamsul’s term was not renewed in March following clashes with his boss and PNW’s biggest supporter, Malaysian Prime Minister Najib Abdul Razak, who is now fighting for political survival over allegations of financial mismanagement of billions of dollars in state funds. It was Najib who announced the project’s massive $36-billion price tag, the equivalent of 10 per cent of Malaysia’s GDP, to a surprised Prime Minister Stephen Harper during a visit to Southeast Asia in 2013. Will Petronas or the Malaysian government continue to support PNW’s high-risk project if Najib is no longer prime minister?.........management. Zulkiflee made his first move by approving PNW’s offer to pay $1.15 billion to the 3,700-member Lax Kw’alaams First Nations group over 40 years for the right to build the LNG project over their property and ancient fishing grounds. Despite some calling it a generous “game changer,” the sum offered was insignificant as it amounts to less than $8,000 per person per year........“Industry analysts expect only one to three B.C. LNG projects to be operating by 2025. The market outlook for Asia is still uncertain,” she wrote. Also, Canadian projects, requiring the equivalent of crude oil prices at $76 to $90 US a barrel, are expensive when compared with their rivals in the U.S.... Another likely source of concern, not widely discussed, is the commitment of two of PNW’s cornerstone shareholders, Sinopec and IOC.... Amid the LNG price collapse, India is spoiled for choice to increase import volumes through existing channels with Qatar, Nigeria, Egypt and Australia while it pursues talks to develop new overland supply lines with Russia, Turkmenistan and even Iran, which could soon be free of trade sanctions imposed by the West. These developments are leaving Petronas looking increasingly quixotic in its quest to launch B.C.’s LNG industry. The company’s attempts to sell down its 62 per cent stake in PNW LNG to 50 per cent have stalled since the last deal was concluded with Sinopec in April 2014....Rather than clarify the situation, Petronas’ offer to make a conditional final investment decision could set the stage for further negotiations and uncertainty.
http://www.vancouversun.com/opinion/op-ed/Opinion+Uncertainty+grows+over+deal/11112497/story.html
Tanjung Offshore secures RM250m contract from Petronas Carigali Tuesday, 9 June 2015
KUALA LUMPUR: Oil & gas services provider, Tanjung Offshore Bhd secured a RM250mil contract to provide topside maintenance to Petronas Carigali Sdn Bhd’s platforms in Sarawak.
It said on Tuesday the construction work request contract would involve the maintenance for Petronas Carigali’s offshore and onshore facilities in Sarawak. The contract is for two years with an option to extend for another year....
http://www.thestar.com.my/Business/Business-News/2015/06/09/Tanjung-Offshore-secures-RM250m-contract-from-Petronas-Carigali/?style=biz
1 June 2015:
Petronas top official robbed of RM300,000 (c. USD 81,000) in house break-in
Petronas top official robbed of RM300,000 in house break-in Posted on 27 May 2015 - 09:21pm
KUALA LUMPUR: A gang of robbers escaped with more than RM300,000 in cash and valuables after holding up a top official of national petroleum company Petronas and his family at their bungalow near Taman Tun Abdul Razak, Ampang today.
The Petronas top official, who is a Datuk, was asleep when he and his family were woken up from their sleep by the robbers who broke in at about 5am.
The gang fled after getting cash, gold jewellery, luxury watches and other items.
Minutes after they left, the victims, who were unharmed, managed to untie themselves and alerted the police.
http://www.thesundaily.my/node/311694
22 May 2015:
Malaysia's Petronas posts Q1 profit drop, cuts dividend; Petronas reports first oil from Indonesia's Bukit Tua field
UPDATE 1-Malaysia's Petronas posts Q1 profit drop, cuts dividend on oil price fall By Anuradha Raghu Fri May 22, 2015 6:59am EDT * Q1 net profit 11.4 bln rgt vs 18.8 bln rgt in Q1 2014 * Maintains projection for crude prices at avg $55/barrel in 2015 * Price will be rangebound for many, many quarters- CEO (Adds details of results, CEO quotes) KUALA LUMPUR, May 22 (Reuters) - Malaysian state-owned oil firm Petronas posted a 39 percent drop in first-quarter net profit on lower crude prices, but a mild rebound in oil helped earnings bounce from the previous quarter when it made its first quarterly loss in at last five years. Global oil prices have climbed more than 40 percent from six-year lows hit earlier this year to touch 2015 highs in early May. Prices, though, are still well-down from the peaks of June 2014, when growing evidence of a worldwide glut sent crude markets into free fall. Petroliam Nasional Bhd, which is called Petronas, reported on Friday a net profit of 11.4 billion ringgit ($3.18 billion) for the January-March period, compared to a profit of 18.8 billion ringgit in the same period in 2014. It had suffered a net loss of 7.3 billion ringgit ($2.03 billion) in the previous quarter. Malaysia, a net energy exporter, relies heavily on Petronas for most of its oil and gas revenue. Out of the 66 billion ringgit of oil revenues in 2014, 29 billion came in the form of dividends paid by Petronas, a government report showed. That dividend would be cut to 26 billion ringgit in 2015, Petronas said.....
http://www.reuters.com/article/2015/05/22/petronas-results-idUSL3N0YC3QY20150522
Petronas reports first oil from Indonesia's Bukit Tua field WorldOil (subscription) KUALA LUMPUR, Malaysia -- Petronas has reached a significant milestone in its upstream operations in Indonesia with first oil achieved from Bukit Tua field on May 17. “This upstream project is an integrated development as it also involves the ...
http://www.worldoil.com/news/2015/5/22/petronas-reports-first-oil-from-indonesia-s-bukit-tua-field
18 May 2015:
LNG's adverse impact on Petronas and Malaysia - Citigroup cited in The Star; PETRONAS suggests that Malaysia's many O&G players should consolidate
LNG's adverse impact on Petronas and Malaysia Monday, 18 May 2015 By: TEE LIN SAY PETALING JAYA: The earnings of state-owned Petroliam Nasional Bhd (Petronas) and the country’s current account are expected to come under pressure in the next few months due to the steep drop in the average price of spot liquefied natural gas (LNG). LNG prices track crude oil prices and have more than halved, with the average spot price down as of April to US$7.60 mmbtu (million British thermal units)since oil prices started their downward descent last July. LNG makes up two-thirds of Petronas’ total oil and gas production, and with contract agreements up for renewal, analysts pointed out that earnings would be hit. The average price of spot-LNG in July 2014 was US$13.8MMbtu, and prices rose slightly to US$15.1mmbtu as of Dec 2014. It started adjusting early this year, and as of April, it stands at US$7.9mmbtu. Economists believed that the country would face a current account (CA) deficit in the second quarter if countracts negotiated were not favourable.
Citigroup Inc economist Kit Wei Zheng warned that headwinds from lower oil prices, which have not been as severe based on first-quarter gross domestic product (GDP) data, could increase going forward. “The impact of weaker LNG prices on the CA should be maximum in the second quarter, and the CA surplus should recover in the second-half for leading to a full year surplus of 3.2% of GDP,” he said in a report following the release of Bank Negara’s first-quarter GDP data last Friday.
In 2014, Petronas produced a total of 1,358 kboe (kilo barrel of oils equivalent) of gas out of a total of 2,226 kboe of oil and gas. Gas made up 61% of Petronas’ total oil and gas production that year. The LNG sales volume that year increased 4% to 30.12 million tonnes from 28.85 tonnes in 2013, driven by higher trading volume and higher sales from the Petronas LNG complex in Bintulu, Sarawak. Not only would that have implications on Petronas earnings, but Petronas’ contributions to government revenue could be impacted. Petronas contribution had dropped to about 22%, from 30%. In 2012 and 2013, when the going was still good and Brent crude stood above US$100 per barrel, Petronas had contributed RM80bil and RM73.4bil respectively to the Government.
http://www.thestar.com.my/Business/Business-News/2015/05/18/LNGs-adverse-effect-on-Petronas-and-Malaysia/?style=biz
M'sian O&G companies should explore consolidation opportunities, says Petronas Monday, 18 May 2015 KUALA LUMPUR: Malaysian oil and gas (O&G) companies must consider exploring consolidation opportunities within the fraternity to increase competitiveness and put the industry in a good stead when the global oil market recovers. Petroliam Nasional Bhd (Petronas) President and Group Chief Executive Officer Datuk Wan Zulkiflee Wan Ariffin said consolidation opportunities were plentiful. "Those with heftier cash and other means to fund consolidation and guided by a clear strategic focus, will be able to beat competitors to the negotiating table for winning deals," he said. The manoeuvres, he added, would also position the companies ahead of the pack when oil prices recover. Wan Zulkiflee said this in his welcoming remarks at the Asia Oil and Gas Conference 2015 here today.
http://www.thestar.com.my/Business/Business-News/2015/05/18/Msian-OnG-companies-should-explore-consolidation-opportunities-says-Petronas/?style=biz
6 May 2015:
PETRONAS JV group offers US$950 million to native group for Pacific NorthWest LNG project, Petronas completes asset acquisition - 15.5% interest in the Shah Deniz production sharing agreement in the Caspian Sea, a 12.4% stake in Azerbaijan Gas Supply Co and a 15.5% share in the South Caucasus Pipeline Co; PETRONAS carigali pay cut report quickly denied
Petronas-led JV offers aboriginal group US$950m in Canada for project nod (Update) Tuesday, 5 May 2015; KUALA LUMPUR: Pacific NorthWest LNG is offering up to C$1.15bil (US$950mil) over 40 years to an aboriginal community in Canada to approve its natural gas export terminal on Canada’s Pacific Coast. Reports said on Tuesday the joint venture, which is led by Petroliam Nasional Bhd (Petronas) had made the offer to the community, which would be paid over 40 years.
Pacific NorthWest LNG is offering the payments to the Lax Kw’alaams First Nation so it can build the unit on the community’s traditional lands at the port of Prince Rupert in northern British Columbia, the native group said on its website. The reports said the deal also included incentives from the provincial government and gas pipeline developers. According to the native group, the payments are for the life of projects (approximately 40 year to 60 years) using 40 years as an assumption in its summary.
http://www.thestar.com.my/Business/Business-News/2015/05/06/Petronas-seeks-Canadian-community-support-for-project/?style=biz
Petronas still in talks with Canadian aboriginal group By Fatin Rasyiqah Mustaza / The Edge Financial Daily | May 6, 2015 : 8:41 AM MYT KUALA LUMPUR: A Petroliam Nasional Bhd (Petronas) led consortium has yet to conclude the long drawn out negotiations with the Lax Kw’alaams First Nation group on the oil company’s plan to build a gasification terminal to export liquefied natural gas (LNG) at the port of Prince Rupert, western Canada. The consortium’s Pacific NorthWest LNG project is required to have the consent of the Lax Kw’alaams to construct a LNG terminal within their territory. The project will liquefy and export natural gas produced by Progress Energy Canada Ltd in which Petronas also holds a controlling stake. Currently, Petronas owns 62% of Pacific NorthWest LNG. Other stakeholders include China Petroleum & Chemical Corp Ltd (15%), Japan Petroleum Exploration Co Ltd (10%), Indian Oil Corp Ltd (10%) and Brunei National Petroleum Company Sdn Bhd (3%). Petronas said an impact benefit agreement offer has been tabled to the Lax Kw’alaams, in addition to offers from both the government of British Columbia and TransCanada Corp....
http://www.theedgemarkets.com/my/article/petronas-still-talks-canadian-aboriginal-group?google_editors_picks=true
Petronas completes asset acquisition Monday, 4 May 2015 - 15.5% interest in the Shah Deniz production sharing agreement in the Caspian Sea, a 12.4% stake in Azerbaijan Gas Supply Co and a 15.5% share in the South Caucasus Pipeline Co; BAKU: Malaysia’s state-owned oil and gas (O&G) giant Petronas has completed its transaction for the acquisition of O&G related assets in Azerbaijan, following a sales and purchase agreement it signed with Norway-based Statoil in October last year.
Petronas’ Azerbaijan country chair Zainal Abidin Zainudin said Petronas completed the acquisition on April 30 and now officially owns a 15.5% interest in the Shah Deniz production sharing agreement in the Caspian Sea, a 12.4% stake in Azerbaijan Gas Supply Co and a 15.5% share in the South Caucasus Pipeline Co. It was reported earlier that Statoil sold its stake in the Shah Deniz project for US$2.25bil (RM8bil). The deal was Petronas’ third largest acquisition, after its US$5.7bil acquisition of Canada’s Progress Energy Resources in 2012 and the US$2.5bil acquisition of Gladstones LNG project in Australia in 2008. Zainal Abidin said the acquisition gives Petronas a strategic presence in a producing field in oil-rich Azerbaijan, where the company is involved in project development totalling around US$38bil....
http://www.thestar.com.my/Business/Business-News/2015/05/04/Petronas-completes-asset-acquisition/?style=biz
*This was soon denied: Petronas Carigali cuts salaries by 20% Posted on 15 April 2015 - 05:39am by Eva Yeong PETALING JAYA: Petronas Carigali Sdn Bhd has asked its staff to take a 20% pay cut in view of the challenging market conditions caused by low global oil prices, a source told SunBiz. According to a memo obtained by SunBiz, Petronas Carigali indicated that a 20% reduction in current salaries would be required effective May 1, 2015. The company said in the memo that it intends to continue investing to sustain production levels despite the low oil price environment affecting its expenditure and projects feasibility. However, it would be challenging to do so at the current cost structure and as part of its cost optimisation efforts, the company has decided to revise salary rates. Petronas Carigali is the exploration and production (E&P) subsidiary of Petroliam Nasional Bhd (Petronas).
UPDATE 1-Petronas not cutting pay or staff, chief executive say (Adds details from Petronas statement) Wed Apr 15, 2015 7:39am EDT (Reuters) - Malaysian state oil firm Petroliam Nasional Bhd (Petronas) on Wednesday denied a media report that said staff at one of its units were asked to take a pay cut due to the plunge in global oil prices. "It is misreporting. There is no salary cut and retrenchment for Petronas staff," Chief Executive Wan Zulkiflee Wan Ariffin told reporters following a shareholders meeting for a Petronas unit. Local newspaper SunBiz earlier reported that Petronas Carigali issued an internal memo asking its staff to take a 20 percent pay cut due to low oil prices.
http://www.reuters.com/article/2015/04/15/malaysia-petronas-idUSL4N0XC42B20150415
21 April 2015:
PETRONAS FLNG by 1Q2016, Carigali strives to improve efficiency, Petronas Chemicals gears up for 80%-85% plant utilisation rate; Pengerang terminal added to Platts recognised loadings from Pasir Gudang, Tanjung Langsat, Tanjung Bin and certain floating storage units in nearby waters for its Singapore price assessment process
Petronas FLNG to tap marginal fields by 1Q of 2016 Tuesday, 21 April 2015 By: INTAN FARHANA ZAINUL; KUALA LUMPUR: Petroliam Nasional Bhd (Petronas) expects to complete its ambitious floating liquefied natural gas (FLNG) vessel by the first quarter next year. Petronas vice president and venture director LNG project domestic Datuk Abdullah Karim said on Tuesday the Petronas FLNG 1 (PFLNG) is now 91% completed. "With PFLNG we are able to monetise gas fields which previously were considered too small or stranded," he told reporters at the PFLNG briefing.
He explained that a marginal field for gas would have a reserve of about half a trillion cubic metres.
For the PFLNG1, Abdullah said would be on site, which is in Bintulu, Sarawak (Kanowit field) by March 1 next year. "We are looking about 1.2 million tonnes per annum of LNG production from the PFLNG 1," he said. The PFLNG 1 was designed to operate in shallow waters. The final investment decision for the PFLNG Satu was made on March 27, 2012.........
http://www.thestar.com.my/Business/Business-News/2015/04/21/Petronas-FLNG-sails-1Q-next-year/?style=biz
Petronas Carigali strives to improve efficiency to mitigate oil plunge impact Published: 21 April 2015 5:58 PM Petronas Carigali has implemented strategies to improve cost efficiency. – The Malaysian Insider pic, April 21, 2015. Petroliam Nasional Berhad (Petronas)'s upstream arm Petronas Carigali Sdn Bhd has implemented strategic approaches to improve its cost efficiency to mitigate the adverse impact of the plunge in oil prices. Among the initiatives taken is production with minimal cost, leaner operations and drilling, integrated logistics, and better innovation and collaboration, according to a statement issued by the state oil company today. In the same statement, Petronas Carigali president Datuk Mohd Anuar Taib urged Petronas contractors to remain agile, resilient and versatile. Anuar also shared that Petronas Carigali's deliverables were significantly growing in terms of number and complexity....
http://www.themalaysianinsider.com/business/article/petronas-carigali-strives-to-improve-efficiency-to-mitigate-oil-plunge-impa#sthash.4SzG0ueH.dpuf
Petronas Chemicals gears up for 80%-85% plant utilisation rate Tuesday, 21 April 2015
KUALA LUMPUR: Integrated chemicals producer, Petronas Chemicals Group Bhd (PCG) is currently pushing for a higher average plant utilisation rate of between 80 to 85 percent in a bid to drive sales volume. PCG President and Chief Executive Officer Datuk Sazali Hamzah said the company's efforts in this respect are progressing well. "PCG has improved operational excellence, with a plant utilisation rate of 80 per cent last year compared with 78 per cent in 2013, and for 2015 our utilisation rate is expected to rise to 80 to 85 per cent. "And with the latest Sabah Ammonia Urea (SAMUR) plant due for commission next year, PCG's utilisation rate could hit beyond 85 per cent from 2016," he told Bernama on the sidelines of the 3rd Hazards Asia Pacific symposium held here today.......... On the SAMUR project in Sipitang, Sabah and the Refinery and Petrochemical Integrated Development (RAPID) in Pengerang, Johor, Sazali said they are progressing well and on track. "SAMUR is 90 per cent completed and we target to commission it by the first quarter of 2016.
"As for RAPID, as far as I know the project is also progressing as planned," he said.
The world-class SAMUR project aims to produce 740,000 metric tonnes per annum (mtpa) of liquid ammonia and 1.2 mtpa of granulated urea. Meanwhile, RAPID is expected to produce 7.7 mtpa of differentiated and specialty chemicals such as synthetic rubber and high-grade polymers, and its refinery will be capable of producing petrol and diesel that meet Euro 4 and Euro 5 fuel specifications..........
http://www.thestar.com.my/Business/Business-News/2015/04/21/PCG-gears-up-for-80-85-PCT-plant-utilisation-rate/?style=biz
Pengerang gets Platts’ nod Tuesday, 31 March 2015; PETALING JAYA: The Pengerang oil terminal in Johor is expected to receive greater interest following its inclusion into oil agency Platts Singapore’s pricing assessments for middle distillates and gasoline. Industry players said the inclusion of the Pengerang oil terminal was expected to offer traders more flexibility in loading cargo and improve market liquidity. “This will help efforts to make Johor the region’s oil and gas trading hub by providing traders accurate and timely information on the prices of oil products,” an analyst said. The Pengerang terminal, majority owned by the 51%-49% joint venture between Dialog Group Bhd and Dutch oil and chemicals storage company Vopak, started operations last year.
“The accreditation (by Platts) will help us in marketing our terminal. We can market to those traders on Platts. ........Meanwhile, Reuters quoted a source from Vopak who said that the facility was in the process of being filled but it has not yet reached full capacity. “With the Platts approval, we expect interest to pick up,” Reuters quoted the source as saying. .......Apart from landed storage tanks in Singapore, Platts currently recognised loadings from Pasir Gudang, Tanjung Langsat, Tanjung Bin and certain floating storage units in nearby waters for its Singapore price assessment process.
.......Platts said Pengerang joined those as an alternative delivery location, and would be subject to the same performance requirements and normalisation processes. The terminal has five berths, with the largest able to accommodate a VLCC (very large crude carrier). The new terminal has an initial storage capacity of 1.3 million cu m over 50 tanks, though a second stage could add an additional one million cu m.......
http://www.thestar.com.my/Business/Business-News/2015/03/31/Pengerang-gets-Platts-nod/?style=biz
12 April 2015:
Low oil prices improving economics for Petronas-led B.C. LNG project
Low oil prices improving economics for
Petronas-led B.C. LNG project by Yadullah Hussain | April 9, 2015 12:06 PM ET TORONTO – Low oil and gas prices have improved the economics for a
Petronas-led natural gas export project on the British Columbia coast as the company looks to make a final investment decision in June. “Over the past three months, we have driven costs down … in a very significant way,” Michael Culbert, CEO of Pacific NorthWest LNG, a consortium led by Malaysia’s state-owned
Petronas, told an energy conference in Toronto this week.
http://business.financialpost.com/news/energy/low-oil-prices-improving-economics-for-petronas-led-b-c-lng-project?__lsa=1169-da7e
5 April 2015:
Japan's Toho Gas to buy LNG, Petronas’ Botswana operation hit by fall in prices
Japan's Toho Gas to buy LNG from Malaysia's Petronas TOKYO, Tue Mar 31, 2015 1:35am EDT
(Reuters) - Japan's third-biggest city-gas supplier, Toho Gas Co, said on Tuesday it signed a basic agreement with a wholly-owned unit of Malaysia's Petroliam Nasional Bhd (Petronas) to buy liquefied natural gas (LNG). The company is set to accept seven to nine LNG cargoes a year during the 10-year contract starting in April 2017, it said in a statement. The prices will be linked to crude and U.S. Henry Hub prices, with an option to change the destination on condition of obtaining the seller's prior consent, it added.......
http://www.reuters.com/article/2015/03/31/toho-gas-petroliam-lng-idUSL3N0WX23Y20150331
Petronas’ Botswana operation hit by fall in crude oil prices By: MOHD HAFIDZ MAHPAR Friday, 3 April 2015 KUALA LUMPUR: Petroliam Nasional Bhd’s (Petronas) Botswana-listed operation last year recorded its first profit drop in four years due to the decline in international crude oil prices.
Engen Botswana Ltd told the Botswana Stock Exchange on Friday that its net profit was halved to 65.2 million pula (RM24.1mil) last year on the back of a slightly lower revenue of 2.6 billion pula (RM962mil). The downstream petroleum marketer said its gross profit fell by 26.9% mainly due to the decline in international crude oil prices, which necessitated the revaluation of inventories during the course of the year in line with International Financial Reporting Standards. Foreign exchange gains also decreased from 9.7 million pula (RM3.6mil) at the end of 2013 to 1.4 million pula (about RM520,000) at the end of 2014. It said this was due to the depreciation of the Botswana pula against the South African rand. Engen Ltd, which operates South Africa’s second largest refinery, is 80% owned by Petronas and has a 70% stake in Engen Botswana, according to Engen Botswana’s 2014 annual report.....
http://www.thestar.com.my/Business/Business-News/2015/04/03/Petronas-Botswana-operation-profit-hit-by-fall-in-oil-prices/?style=biz
31 March 2015:
Cost management crucial for O&G, says Petronas
Cost management crucial for O&G, says Petronas COO By: WONG WEI-SHEN Tuesday, 31 March 2015 “I strongly believe that one of the issues that the O&G industry needs to focus on in the current environment is cost management,” said Petroliam Nasional Bhd (Petronas) chief operating officer and executive vice-president of downstream Datuk Wan Zulkiflee Wan Ariffin (pic). Due to falling prices and increasing costs, companies are now re-prioritising shareholders’ returns over production growth, he said at the launch of the Offshore Technology Conference (OTC) Asia 2016. He added that across the board, there had been a reduction in budgeted capital expenditure, lower production plans and more targeted exploration efforts, as well as rationalisation of the downstream business.
Petronas executive vice-president and chief executive officer of upstream Datuk Wee Yiaw Hin said: “In this challenging environment, it becomes more important that we really push technology to the limit to help manage cost.”........
http://www.thestar.com.my/Business/Business-News/2015/03/31/Cost-management-crucial-for-OG-says-Petronas-COO/?style=biz
26 March 2015:
PETRONAS Carigali JV strikes oil off Sabah
Petronas Carigali JV strikes oil off Sabah By: MOHD HAFIDZ MAPHAR Wednesday, 25 March 2015; KUALA LUMPUR: A Japanese-led group exploring Deepwater Block R off Sabah, which includes Petronas Carigali, has made “a significant oil discovery” at the Bestari-1 exploration well. The group comprises operator JX Nippon Oil & Gas (27.5% interest), Inpex Corp of Japan (27.5%), Petronas Carigali (25%) and Australia-listed Santos (20%).... Santos told the Australian Stock Exchange on Wednesday that the discovery was being evaluated with a view to planning an appraisal campaign. “The Bestari-1 well encountered 67 metres of net oil pay in multiple sand packages within the primary Miocene age formation at true vertical subsea depths ranging from 1,860m to 2,702m,” it said. “The oil bearing sands are of high quality with good porosity and permeability. Oil samples, recovered from wireline pressure and sampling tools, confirm 27-30 degree API Oil with no indication of hydrogen sulphide and neglible carbon dioxide.”.... Petronas awarded the production sharing contract for Deepwater Block R, a 672 sq km area where the well is located, in January 2012. .... The national oil company said the exploration block was near key discoveries such as the Kikeh, Kebabangan, and Gumusut-Kakap fields.
http://www.thestar.com.my/Business/Business-News/2015/03/25/Petronas-Carigali-JV-strikes-oil-off-Sabah/?style=biz
24 March 2015: Petronas says $5 bln bond issue for capex, possible M&As - Reuters
Malaysia's Petronas says $5 bln bond issue for capex, possible M&As KUALA LUMPUR, March 19 Thu Mar 19, 2015 4:00am EDT (Reuters) - Malaysia's Petroliam Nasional Bhd (Petronas) plans to use the $5 billion it raised in Asia's largest bond offering so far this year for corporate expenses as well as possible acquisitions, the company said. In a statement to Reuters, the state-owned energy firm, which posted its first quarterly loss in at least five years in the fourth quarter due to the slump in global oil prices, declined to give any details about its potential M&A plans. It had earlier stated plans to cut capital expenditure by 10 percent and operating expenses by up to 30 percent this year, but still went ahead with the bond and sukuk issue, its first foray into the debt market in six years.
http://www.reuters.com/article/2015/03/19/malaysia-petroliam-bonds-idUSL3N0WK3SJ20150319
12 March 2015: US$5 billion bonds sold, some bonds sold at lower premium than initially offered, analyst says "risk on for Asia" when PETRONAS gets the deal out, new PETRONAS bonds seemed expensive compared to the curve but cheaper than CNOOC (PETRONAS used to trade inside CNOOC)
Malaysia’s Petronas Sells $5 Billion of U.S. Dollar Bonds by Elffie Chewand Christopher Langner 2:25 PM HKT March 11, 2015; (Bloomberg) -- Petroliam Nasional Bhd., Malaysia’s state-owned oil company, sold $5 billion of dollar-denominated bonds Wednesday.... Petronas issued the debt in four parts, including a sukuk tranche, according to data compiled by Bloomberg. The longest-dated portion was $1.5 billion of 4.5 percent, 30-year bonds that yield 1.9 percentage points more than similar-maturity U.S. Treasuries.... The Kuala Lumpur-based energy company borrowed in dollars at a time when Malaysian issuers in the currency are the worst performers in Asia for the year. It also sold $1.5 billion of 3.5 percent, 10-year notes, $750 million of 3.125 percent, seven-year securities, and $1.25 billion of five-year 2.707 percent sukuk, according to data compiled by Bloomberg.
Petronas’s new Islamic bonds were sold at a premium of 110 basis points. It had initially offered the debt with a yield of about 135 basis points, people familiar with the matter said earlier this week.
Its seven-year conventional debt paid 130 basis points, versus a marketing spread of about 150, while the 10-year and 30-year securities were marketed at about 175 basis points and 220 basis points respectively. The 30-year debentures priced at a 190 basis-point premium.
http://www.bloomberg.com/news/articles/2015-03-11/petronas-prepares-7-billion-bond-as-borrowing-costs-soar-on-oil
ASIA CREDIT CLOSE: Petronas curve holds steady as EM bonds weaken Wed Mar 11, 2015 4:54am EDT; SINGAPORE, March 11 (IFR) - Malaysian energy giant Petronas Corp dominated attention today with its four-tranche bond and sukuk offering, which is expected to be USD6bn-7bn in size.... "If Petronas can get this deal out of the door, it will be risk on for Asia," said one credit trader. "That's not a given, thanks to the size and the weak oil price."... Petronas's old bonds were little changed, despite the new supply. The 2019s were at Treasuries plus 115bp/122bp, around 2bp wider, while the 2022s were at T+135bp/140bp. The new bonds offer around a 5bp concession to the curve, according to a bond investor. However, many investors are underweight Malaysia, and a new issue of benchmark bonds gives them a quick way to balance their portfolios.... Investors said that the new Petronas bonds seemed expensive compared to the curve, but cheap in comparison to CNOOC's 2018s, for example, which were quoted today at a Z spread of 77bp/86bp. Petronas used to trade inside CNOOC....
http://www.reuters.com/article/2015/03/11/markets-asia-debt-idUSL4N0WD35920150311
9 March 2015:
PETRONAS starts roadshow for RM17 billion bond and sukuk, S&P assigns preliminary A- to sukuk, Mahathir urges external auditors to allay public concerns about the billions of overseas investments by PETRONAS and other key entities / agencies
REFILE-Malaysia's Petronas begins $17 bln bond and sukuk drive Thu Mar 5, 2015 7:28am EST
(Reuters) - Malaysian energy company Petronas began roadshows on Thursday to raise up to $17 billion from conventional and Islamic bonds, or sukuk, for working capital.... State-owned Petronas met potential investors for a $15 billion multi-currency conventional bond programme and a one-off dollar-denominated sukuk issuance of $2 billion, two sources told Reuters.... A spokesman from Petronas confirmed the plans.... Bank of America Merrill Lynch, CIMB Group Holdings , Morgan Stanley MUFG, JP Morgan and Citibank are lead arrangers, while HSBC and Deutsche Bank are playing smaller supporting roles, the sources said. Petronas will conduct roadshows in Kuala Lumpur, Abu Dhabi, Dubai, London, Hong Kong, Boston, Los Angeles and New York from Thursday to March 10, they added. Ratings agency Standard & Poor's on Thursday assigned a preliminary rating of A- to the Petronas sukuk.... The move by Petronas comes after the company announced its first quarterly loss in at least five years on Feb. 27 because of the global slump in oil prices. It stated plans to cut capital expenditure by 10 percent and operating expenses by up to 30 percent this year....
http://www.reuters.com/article/2015/03/05/petronas-bond-idUSL4N0W744U20150305
Felda chairman’s son quizzed on London luxury hotel buy Published: 7 March 2015 5:09 PM; Felda's overseas buying spree was raised by former prime minister Tun Dr Mahathir Mohamad earlier this year, when he urged Putrajaya to appoint external auditors for all its agencies to allay public concerns about the billions being spent on investments across the world. "We see entities such as Felda, EPF, Tabung Haji spending billions in acquiring foreign properties while others such as MAHB (Malaysia Airports Holdings Bhd) and Petronas have bought shares in airports and Canadian ventures also involving huge sums of money," the former PM had written in his blog....
http://www.themalaysianinsider.com/malaysia/article/felda-chairmans-son-quizzed-on-london-luxury-hotel-buy#sthash.ATeX0UAr.dpuf
28 February 2015: PETRONAS says no more RSCs when oil price below US$80, earnings weakness in Malaysia O&G inevitable with 10-15% capex cuts in 2014-2015 (mulling 30% opex cut too), Canada project FID by June 2015 with award of capital tax allowance (sources earlier said not given) and re-bidding of tenders to save cost.
Malaysia’s Petronas Swings to First Quarterly Loss- State oil-and-gas firm intends to cut investment plans over next two years after $2.7 billion loss.By Saurabh Chaturvedi Feb. 27, 2015 8:33 a.m. ET
KUALA LUMPUR, Malaysia--Malaysia’s national oil-and-gas company, Petroliam Nasional Bhd., or Petronas, on Friday said it would cut its investment plans by as much as 30 billion ringgit ($8.3 billion) in the next two years as the company reported its first-ever quarterly loss.... Petronas Chief Financial Officer George Ratilal told reporters that the loss was primarily due to the fall in global crude-oil prices and on account of some asset impairment charges totaling 20 billion ringgit for the full year. ... The company’s cut represents a reduction of 10%-15% for this year and the next as Petronas expects crude prices to hover around the $55-a-barrel level, Chief Executive Shamsul Azhar Abbas told reporters at an earnings briefing. The company is also evaluating options to cut operating expenses by 30%....
http://www.wsj.com/articles/malaysian-state-oil-gas-energy-firm-petronas-posts-first-ever-quarterly-loss-1425043981
Shamsul: No more RSC for third party for now By: NG BEI SHAN Saturday, 28 February 2015
THERE was a time when redeveloping marginal oil fields was a “hot” topic among local oil and gas services players.... Some of these companies’ aspirations to move upstream, however, are shattered as Petrolaim Nasional Bhd (Petronas) has reiterated that it would not dish out any more new risk sharing contracts (RSC) at below US$80 per barrel.... “We don’t see any future awards of RSC contracts at prices below that,” says president and chief executive officer Tan Sri Shamsul Azhar Abbas....
It will be re-developing the brownfields on its own via Vestigo Petroleum Sdn Bhd, a subsidiary that was set up less than two years ago to develop small and mature fields... “We reckon the time has come for us to say that we are capable of doing this ourselves rather than award to other international or local players,” he says, explaining that the upstream unit of the national oil company has garnered the capabilities and knowledge from its partners over the years.... To recap, Petronas’ upstream unit Petronas Carigali Sdn Bhd has established Vestigo in July 2013 to complement the former’s upstream activities with the focus on small, marginal and mature fields....
http://www.thestar.com.my/Business/Business-News/2015/02/28/Shamsul-No-more-RSC-for-third-party-for-now/?style=biz
Earnings weakness from O&G inevitable Saturday, 28 February 2015; IT must have come as a shock for Petroliam Nasional Bhd (Petronas) to report its first quarterly loss in five years since it started reporting quarterly figures. The RM7.3bil loss was mainly due to an impairment of assets after a revaluation, but the headline figure does indicate that 2015 is not going to be rosy. Petronas has said it will cut capital expenditure (capex) by 10% this year and by 30% for some items. This directly means less activity for the sector, and it has started to show in some of the oil and gas (O&G) service providers in the latest earnings season.
http://www.thestar.com.my/Business/Business-News/2015/02/28/Earnings-weakness-from-OG-inevitable-Any-more-Stuart-Gullivers-out-there-Feeling-the-pinch-from-MAS/?style=biz
Canada project on track Saturday, 28 February 2015; PETROLIAM Nasional Bhd (Petronas) will make a final investment decision (FID) on a project to build a multi-billion-ringgit liquefied natural gas (LNG) export terminal in British Columbia, Canada, by June this year... However, president and chief executive officer Tan Sri Shamsul Azhar Abbas has alluded that the national oil company would pursue the development as it has received what it wanted from the Government and was waiting for further approvals.... “The issues outstanding with the local provincial government and the Canadian government have been resolved. The capital allowance will be given, which will further improve the economics of the project,” he said yesterday... He also dismissed speculation that Petronas was considering walking out of the project because of the economics.... “Enough of such speculation …we can wait until the end of June and still complete it within time,” he reiterated.
Petronas will be re-bidding the tenders for the job to build the LNG plant because cost has come down with the decline in oil and gas prices....
http://www.thestar.com.my/Business/Business-News/2015/02/28/Canada-project-on-track/?style=biz
27 February 2015: PETRONAS 4Q2014 loss or RM9.9 billion / US$2.7 billion on US$76.27 Brent (down from US$109.27 a year ago) and impairment, planned capex spend will be cut by RM30 billion over next two years, PETRONAS cash from operations RM10 billion shortfall versus capex spend and dividend commitments in 2015 says Moody's; Shamsul's says 2015 outlook likely "bad"
Petronas Turns to $2.7 Billion Fourth-Quarter Loss on Oil Slump 'By' Pooi Koon Chong 5:31 PM AWST February 27, 2015 (Bloomberg) -- Petroliam Nasional Bhd., the Malaysian state oil company preparing for a leadership transition in April, reported a loss in the fourth quarter following crude’s plunge. The loss was 9.9 billion ringgit ($2.7 billion) in the three months through Dec. 31, compared with a 9.6 billion ringgit profit a year ago. Revenue dropped 6.4 percent to 79.4 billion ringgit. ... “Petronas Group is taking steps to reduce its planned capital investments and operating expenditure in order to mitigate the potential adverse effect on its profitability and cash flows,” the company said in a statement today.... Natural gas futures dropped to $2.58 per million British thermal units on Feb. 6, the lowest since 2012, while Brent futures are down 44 percent since June. Petronas derived 21 percent of its revenue from gas and an equal amount from crude, with petroleum products being the... Petronas will pay Malaysia’s government, its sole shareholder, a dividend of 26 billion ringgit from 2014 profit of 37 billion ringgit, Petronas Chief Financial Officer George Ratilal told reporters in Kuala Lumpur. Planned capital spending will be cut by as much as 30 billion ringgit over the next two years, he said.... Petronas won’t generate enough cash from operations this year to cover capital spending and dividend commitments, said Vikas Halan, a Singapore-based vice president at Moody’s Investors Service Inc., estimating the shortfall to be at least 10 billion ringgit. .. Petronas deferred its final decision to build a C$36 billion ($29 billion) liquefied natural gas project in Canada’s British Columbia in December, citing low oil prices...Petronas has said it aims to reduce its share in the development to as low as 50 percent..... http://www.bloomberg.com/news/articles/2015-02-27/petronas-turns-to-2-7-billion-fourth-quarter-loss-on-oil-slump
Petronas postst first quarterly loss in 4Q, braces for grim year ahead - Petronas said the Dated Brent averaged US$76.27 in 4QFY14, a decline from US$109.27 a year ago...on prospects, Shamsul 2015 will likely be "bad"...
http://www.theedgemarkets.com/my/article/petronas-posts-first-quarterly-loss-4q-braces-grim-year-ahead-0
Malaysia's Petronas posts $2 bln quarterly loss amid global oil slump KUALA LUMPUR Fri Feb 27, 2015 3:03pm IST
http://in.reuters.com/article/2015/02/27/petronas-results-idINL4N0VL1TV20150227
25 February 2015: Canada hopes C$18+ billion BC LNG project put on hold on 3 Dec 2014 will be revived on major cost drop; PETRONAS "humble pie" says Kinibiz on novation of four LNG carriers costing US$1.1 billion to MISC
Petronas visit bolsters hopes for dormant B.C. LNG project by BRENT JANG; VANCOUVER — The Globe and Mail; Published Sunday, Feb. 22 2015, 4:27 PM EST; A major B.C. LNG project put on hold by Petronas in December is showing signs of a revival as three executives from the Malaysian energy giant prepare to visit Canada..... The Pacific NorthWest LNG joint venture, led by Malaysia’s state-owned Petronas, is positioned to become the first major exporter of liquefied natural gas from Canada, despite a delay that has lasted nearly three months.... On Dec. 3, Petronas and its four Asian partners placed the venture on hold indefinitely due to anticipated high capital costs that make the project uneconomic to build.... Since then, Petronas-led Pacific NorthWest LNG has made progress in extracting cost savings from prospective contractors and suppliers, B.C. Deputy Premier Rich Coleman said. “Evidently, those costs have come down dramatically,” he said in an interview.... The Petronas-led group estimates that $36-billion will need to be spent in order to achieve planned exports to Asia in 2019. The huge budget includes $6.7-billion in two pipeline projects and $11.4-billion for the export plant at Lelu Island, located near Prince Rupert in northwestern British Columbia... Incoming Petronas chief executive officer Wan Zulkiflee Wan Ariffin will travel to Vancouver to meet with B.C. Premier Christy Clark and Mr. Coleman....Pacific NorthWest LNG is scrutinizing international engineering costs, subcontractors and two natural gas pipelines to be built by TransCanada Corp. – the $5-billion Prince Rupert Gas Transmission plan and the $1.7-billion North Montney Mainline.... http://www.theglobeandmail.com/report-on-business/industry-news/energy-and-resources/after-delay-in-lng-deal-petronas-chiefs-to-visit-bc-in-march/article23141240/
Petronas eats RM4bil humble pie By TigerTalk 8:47AM Feb 25, 2015; KINIBIZ The collapse of crude oil price in the last 12 months is forcing many oil giants (to quote the usual biz speak) “rethink”, “reprioritise” and “reposition” their business plans drastically. Budgets are slashed. Expenditure reduced. Mega projects are postponed or scaled down.... In many cases, some may say that they are eating a long overdue humble pie.... Case in point is the recent move by Malaysia’s state oil company Petroliam Nasional Bhd (Petronas) to transfer ownership of four new liquefied natural gas (LNG) carriers to Malaysia International Shipping Corporation Bhd (MISC).... The carriers will be constructed for an estimated US$1.1 billion (RM4 billion) and are to be delivered to MISC in 2016-2017.... Petronas will then charter these LNG vessels from MISC for 15 years, or maybe even more.... The deal is practically an amendment to a deal that was signed two years ago. It novates or replaces a previous shipbuilding contract signed in 2013 between Petronas, MISC and Hyundai Heavy Industries (HHI)...
http://www.malaysiakini.com/news/290144
24 February 2015: MISC - PETRONAS extends time on 5 and signs 5 new LNG carriers
MISC reports that Petronas extends the time charter of five existing LNG carriers and signs on five new LNG carriers. UOBKH Research 24 Feb 2015.
22 February 2015: SapuraKencana's Mokzhani sees need for PETRONAS to manage expectations of Malaysia O&G players as well as sector consolidation (4,000 companies of which 40 are public listed); PETRONAS to set aside RM2.1 billion for Sarawak O&G contractors; Johor to take 10% stake in Pengerang Terminals 2 and Pengerang LNG 2; Pengerang Package III contracts awards; Petronas-Vopak-Dialog industrial terminal info
New Petronas CEO urged to encourage consolidation By: WONG WEI-SHEN Saturday, 21 February 2015; A prominent oil and gas (O&G) player feels that one of the primary tasks of the newly appointed president and chief executive officer of Petroliam Nasional Bhd (Petronas) should be to encourage consolidation within the industry.... “He has to encourage consolidation, as a lot of service companies had mushroomed in the last five to 10 years, enjoying US$100 oil. Having said that, at US$50 oil, we will all have to revisit our cost structures and find efficiencies to help with bringing costs down,” says SapuraKencana Petroleum Bhd vice-chairman Tan Sri Mokhzani Mahathir (pic) of Petronas’ new head Datuk Wan Zulkiflee Wan Ariffin.... Mokhzani is one of the major shareholders in SapuraKencana with a 10.38% equity stake. He also has a 18.55% stake in Yinson Holdings Bhd via Kencana Capital Sdn Bhd.... To paint a clearer picture, there are currently about 4,000 O&G firms that come under the purview of the International Trade and Industry Ministry, while only about 40 of them are listed on the local bourse.... Wan Zulkiflee will be taking over the helm from Tan Sri Shamsul Azhar Abbas starting April 1.... Mokhzani foresees more companies turning to Petronas for help and shelter during this “rough patch” for the next two years.... While there is no more cheap oil production, innovative solutions can help save, Mokhzani adds.... “That’s where Petronas has to encourage Vestigo/Carigali to work smarter with contractors to do this. I think Wan Zulkiflee will be the right person to spearhead this new business approach.... “He has to manage the expectations of both his shareholder and stakeholders (everyone involved in the O&G industry),” he says....
http://www.thestar.com.my/Business/Business-News/2015/02/21/New-Petronas-CEO-urged-to-encourage-consolidation/?style=biz
RM2.1bn Petronas ang pow just for Sarawak by FMT Reporters | February 21, 2015
Exclusive yearly bonanza for oil and gas contractors in the state; KUCHING: Oil and gas contractors in Sarawak have been given a RM2.1 billion “ang pow” from Petronas, to be given every year. The figure is the value of yearly contracts that will be set aside by the national oil corporation exclusively for oil and gas contractors in the state, Star Online reported today....
http://www.freemalaysiatoday.com/category/nation/2015/02/21/rm2-1bn-petronas-ang-pow-just-for-sarawak/
Johor state to take 10% stake in Petronas’ Pengerang terminals Thursday, 5 February 2015 KUALA LUMPUR: The State Secretary, Johor (Incorporated) will take a 10% stake in two terminals at Petroliam Nasional Bhd’s Pengerang Integrated Complex (PIC). The Johor government had on Thursday signed two lease agreements with Pengerang Terminals (Two) Sdn Bhd (PT-2) and Pengerang LNG (Two) Sdn Bhd (PLNG-2) respectively. “The issuance of the lease agreements by the state of Johor marks the next stage of progress in the development of Petronas’ Pengerang Integrated Complex (PIC) in Pengerang, Johor,” said the national oil company. Subsequent to the signing of the agreements, the Johor government would hold a 10% equity in PT-2 and PLNG-2 respectively. PT-2 terminal will serve as a dedicated storage and industrial terminal for Petronas’ Refinery and Petrochemical Integrated Development (RAPID) complex.... RAPID is estimated to cost US$16bil while the associated facilities will involve an investment of about US$11bil.
http://www.thestar.com.my/Business/Business-News/2015/02/05/Johor-state-to-take-10pct-stake-in-Petronas-Pengerang-terminals/?style=biz
Muhibbah gets RM116m Petronas Rapid job in Pengerang Published: February 4, 2015 02:48 PM
KUALA LUMPUR, Feb 4 — Muhibbah Engineering (M) Bhd today announced it has been awarded a RM16 million contract by Tecnicas Reunidas, SA Group for the design and building of temporary construction facilities and accommodation camp for package three in Petronas’ Refinery and Petrochemicals Integrated Development (Rapid) project in Pengerang, Johor. In a filing to Bursa Malaysia, Muhibbah said the construction was scheduled to commence in the first quarter and was expected to be completed by the first quarter of 2016. Tecnicas Reunidas is one of the leading international engineering and construction company for oil and gas production, refining and petrochemicals and power generation projects. The company was awarded by Petronas as an engineering, procurement, construction and commissioning (EPCC) contractor for Package III, the construction of kerosene hydrotreating unit, diesel hydrotreating unit, naphtha hydrotreating unit, cracked naphtha hydrotreating unit, and continuous catalytic reformer units in Petronas’ Rapid project. - See more at:
http://www.themalaymailonline.com/money/article/muhibbih-gets-rm116m-petronas-rapid-job-in-pengerang#sthash.CzKiXoVh.dpuf
Petronas, Vopak, Dialog to develop major storage terminal in Malaysia 4 February 2015 The companies recently signed a shareholders agreement for the development in Pengerang, JohorPetronas, Dialog and Vopak are to develop and operate an industrial terminal in Pengerang, Johor, Malaysia. The industrial terminal will serve the world scale Petronas Refinery and Petrochemicals Integrated Development (RAPID) project. Each company recently signed the shareholders agreement to jointly develop an industrial terminal in Pengerang, Johor, Malaysia. Vopak will have a 25% share. The industrial terminal will serve the users of the new world-scale Petronas' RAPID project which is an integral section of Petronas Pengerang Integrated Complex (PIC). The industrial terminal will have a storage capacity up to 2.1 million m3 for crude, refined products, petrochemical products and liquefied petroleum gas (LPG). The marine infrastructure includes 12 berths. The 24m draft can accommodate very large crude carriers. Berths for unloading and reloading of LNG vessels up to QMax are included in the project plans. - See more at:
http://www.tankstoragemag.com/industry_news.php?item_id=8809#sthash.D29xVXWC.dpuf
13 February 2015: "1MDB Mess Clouds Petronas $7 Billion Debt Proposal" - Bloomberg
1MDB Mess Clouds Petronas $7 Billion Debt Proposal; 'By' Christopher Langner and Elffie Chew 12:00 AM AWST February 13, 2015; (Bloomberg) -- Malaysia’s national oil company Petroliam Nasional Bhd is paying for troubles at a state investment fund....
The yield premium on Petronas’s 2022 U.S. dollar-denominated debt over Treasuries has surged 54 basis points in the last six months after the government said it wasn’t liable for 1Malaysia Development Bhd’s debt and the fund missed a loan payment. That was unfortunate timing for Petronas, which is planning its first dollar bond in five years to raise as much as $7 billion, according to people familiar with the matter.... The cost of insuring Malaysian sovereign debt reached a 16-month high on Jan. 13, one week after local media reported 1MDB’s missed payment, and is up 27 basis points since Dec. 31. Fitch Ratings said last month it may downgrade Asia’s only net crude exporter, citing plunging oil prices and “uncertainty” surrounding finances of the investment fund, whose advisory board is headed by Prime Minister Najib Razak....
“The 1MDB mess is being factored into the spreads for Malaysia and there aren’t that many bonds in which you can express that view,” said Dilip Parameswaran, the Hong Kong-based head of independent advisory firm Asia Investment Advisors Ltd. “That, mixed with lower oil prices and a potential downgrade of the sovereign, are all weighing on Petronas.” ... Natural gas futures dropped to $2.58 per million British thermal units on Feb. 6, the lowest since 2012, while the price of Brent futures is down 46 percent since June. Petronas derived 21 percent of its revenue from gas and an equal amount from crude, with petroleum products being the biggest contributor to its top line, according to its 2013 annual results...The investment fund
(1MDB) failed to repay a 2 billion ringgit loan due in December, Edge Financial Daily reported Jan. 6. The spread on the 2023 notes soared 115 basis points in two days to 417 basis points. It had widened to a record 430 basis points on Feb. 12....
http://khoryuleng.blogspot.com/2014/08/sovereign-wealth-fund-swf-news.html
More news links on 1MDB here:
http://khoryuleng.blogspot.com/2014/08/sovereign-wealth-fund-swf-news.html
12 February 2015: PETRONAS goes to bond market for $7 billion with Deutsche, CIMB & BofA
Today Petronas announced their biggest USD bond offering ($7b) where they mandated Deutsche, CIMB & Bk of America.
KL bank specialists have interesting observations on choice of mandated banks.
10 February 2015: PETRONAS CEO announcement goes to the wire - Wan Zulkiflee (COO and head of downstream) succeeds Shamsul on 1 April 2015; Shamsul expected 7-month extension did not eventuate
Malaysia Names Wan Zulkiflee as Petronas CEO Succeeding Shamsul 'By'Pooi Koon Chong
5:59 PM AWST February 9, 2015 (Bloomberg) -- Malaysia named Wan Zulkiflee Wan Ariffin as president and chief executive officer of state oil company Petroliam Nasional Bhd from April.
Wan Zulkiflee succeeds Shamsul Azhar Abbas, whose contract ends today and will serve through March 31, Prime Minister Najib Razak said in a statement via state news service Bernama today. Wan Zulkiflee, currently Petronas’ chief operating officer and head of its downstream business, will take over the top post in a three-year term....
http://www.bloomberg.com/news/articles/2015-02-09/malaysia-names-wan-zulkiflee-as-petronas-ceo-succeeding-shamsul
Next 24 hours will determine who runs Petronas By: RISEN JAYASEELAN Monday, 9 February 2015; While it had been widely reported recently that the oil giant’s current president and chief executive officer, Tan Sri Shamsul Azhar Abbas, will be offered only a 7-month contract extension, nothing has been firmed up yet considering that there is no statement from Petronas at the time of writing.... The last day of his contract is supposed to be today.... Four names have been speculated to be front runners for this – Datuk Wan Zulkiflee Wan Ariffin, Datuk Mohd Anuar Taib, Datuk Ahmad Nizam Salleh and Md Arif Mahmood....
http://www.thestar.com.my/Business/Business-News/2015/02/09/Next-24-hours-will-determine-who-runs-Petronas/?style=biz
4 February 2015: Malaysia - PETRONAS next pressure point in LNG risk, BofA says 10% fall in LNG price worsens current account by 0.5% GDP versus 10% oil price drop impact of 0.1% of GDP
Malaysia's Next Pressure Point Looms in LNG Risk, BofA Says 'By' Sharon Chen 11:45 AM BNT February 3, 2015; (Bloomberg) -- Malaysia’s current account surplus will probably narrow as liquefied natural gas prices drop, according to Bank of America Merrill Lynch, adding a new risk to the nation’s weakening economic outlook.... LNG prices may be down 50 percent by the middle of this year from last June, as they track oil with a lag of four to six months, according to Singapore-based Bank of America economist Chua Hak Bin. Such a decline would probably reduce Malaysia’s current account surplus by about 2.5 percent to 3 percent of gross domestic product, he wrote in a report Tuesday.... “Collapsing LNG prices will likely be the next pressure point,” Chua said. “Malaysia may be a small net oil exporter but the net gas trade surplus is huge” at 58.9 billion ringgit ($16 billion), or 6 percent of GDP in 2013, he said.... Crude prices at about half the level of a year ago have forced oil-producing Malaysia to cut government expenditure.... The currency has fallen more than 11 percent against the U.S. dollar in the past six months, the second-worst performer among 11 most-traded Asian currencies tracked by Bloomberg..... Malaysia’s current-account surplus shrank to 7.6 billion ringgit in the third quarter, the smallest in more than a year. A 10 percent decline in LNG prices will worsen the current account by about 0.5 percent of GDP while a 10 percent drop in oil prices will only hurt the current account by 0.1 of GDP, according to Chua.....
http://www.bloomberg.com/news/articles/2015-02-03/malaysia-current-account-surplus-to-narrow-on-lng-bofa-says
31 January 2015: PETRONAS affirms planned RM60 billion for Pengerang, questions about Johor's multiple oil & gas hubs, on-hold APH rights sold Dubai investors with no progress since, Benalec reclaimed land project in echo of newbie reclaimed projects affecting Johor property sector?
One too many oil and gas hubs By: M. SHANMUGAM Saturday, 31 January 2015
Going forward, what the nation would be watching closely is the kind of numbers that Petronas would be forecasting to churn out this year. Considering that Brent crude has come down by more than 50% since it hit a high of US$115 per barrel on June 19 last year, Petronas’ earnings would be impacted. The impact would be felt not only in the pockets of the Treasury but also the 4,000-odd oil and gas companies operating in Malaysia.
Petronas, however, had said that it would not reduce its planned expenditure for the integrated oil and gas hub in Pengerang where it would be spending RM60bil over several phases. This amount would multiply many times over if investments from other oil and gas majors to set up downstream oil and gas related ventures in Pengerang are included.
...........However, the oil and gas hub in Pengerang is not the only one coming up in Johor.
Earlier this week, Benalec Holdings Bhd received approval to reclaim some 1,400ha in the Straits of Johor that will be developed into an oil and gas hub. Benalec is essentially a company that made its fortune by reclaiming sea-fronting land in Malacca and selling or jointly developing it. Its expertise is to reclaim land. But the business plan that it has mapped out for its 1,400ha of proposed development in Johor is similar to the Petronas-led Pengerang development, albeit on a smaller scale. Benalec has influential partners in the form of the Johor royalty and businessman Daing A. Malek Rahman. So although it seems like a Herculean effort for Benalec, there is no reason to doubt that the project is here to stay......Apart from Benalec’s proposed oil and gas project in Tanjung Piai, there are two more oil and gas hubs in Johor already in operations – in Tanjung Langsat and Tanjong Bin.
Johor Corp owns the Tanjung Langsat oil and gas terminal and it operates the oil and gas hub together with its partners Trafigura, Technip and MISC. As for Tanjung Bin, there is a petrochemical and maritime industrial park there that is owned by MMC Corp Bhd and its partners are Vitol and MISC. Not to be forgotten is the yet to be completed Asia Petroleum Hub (APH) bunkering and storage facility that is saddled by financial difficulties and is now under the control of banks. CIMB Banking group announced in September that it was selling its rights on the APH project that is to build oil storage and bunkering facilities, to a group of investors from Dubai. Since the announcement, there has not been any progress.......... There is nothing wrong in the creation of oil and gas hubs. But too many hubs lead to over-crowding and eventually forces price-cutting. The end result is there will be casualties. It is already happening in the Johor property sector where prices are dropping. The Iskandar dream is in jeopardy because of several unplanned projects on reclaimed land..........
http://www.thestar.com.my/Business/Business-News/2015/01/31/One-too-many-oil-and-gas-hubs/?style=biz
29 January 2015: PETRONAS alternative energy from shale gas in Canada and Australia might not see immediate returns (but be for future generations?), JGC Corp US$502 million contract to expand LNG Bintulu to help Japan energy security
Petronas digs deeper for future generations by yuen meikeng Updated: Thursday January 29, 2015 MYT 7:51:00 AM; PETALING JAYA: Exciting times lie ahead for Petronas as it explores new sources of oil and gas or “unconventional energy” at locations which include Canada and Australia.
“Petronas is investing heavily in unconventional energy as we are working hard to safeguard and ensure that there is sufficient energy supply for future generations” said Dr Chan Tuck Leong (pic), the process engineering head of Pacific Northwest LNG, a subsidiary of Petronas. He said unconventional hydrocarbon resources were oil and gas, similar to what consumers use today.
In its venture in Canada, Petronas will be converting natural gas extracted from the shale reservoirs into liquefied natural gas (LNG), similar to its operations in Malaysia LNG, Bintulu. Apart from Canada, Petronas has been exploring and producing different types of unconventional energy in Australia too. Dr Chan said these investments might not see immediate returns, but “would definitely benefit future generations”.
http://www.thestar.com.my/News/Nation/2015/01/29/Petronas-digs-deeper-for-future-generations-Company-explores-new-sources-of-oil-and-gas-as-far-as-Ca/
Japan’s JGC Corp secures US$502m Petronas contract By: JOSEPH CHIN Monday, 26 January 2015; KUALA LUMPUR: Japan’s JGC Corporation has secured a 60bil yen (US$502mil) contract from Petroliam Nasional Bhd (Petronas) to expand the facilities at its liquefied natural gas (LNG) complex in Bintulu, Sarawak.... JGC Corporation said on Monday the contract was awarded by Petronas LNG 9 Sdn Bhd (PL9SB) which included engineering, procurement, construction and commissioning (EPCC).... JGC Corporation said the PLC is one of the world’s largest LNG production facilities and has eight production trains with a combined capacity of 25.7 million tonnes per annum (MPTA). JGC said the project would help stabilise Malaysia’s capacity to export LNG which would help to support the country’s continuing economic growth. “The project will also be important in helping Japan’s energy security, as they currently rely on Malaysia for more than 15% of its total LNG imports,” it said.
http://www.thestar.com.my/Business/Business-News/2015/01/26/Japan-JGC-Corp-secures-US$502m-Petronas-contract/?style=biz
20 January 2015: GDP outlook dampened, Ringgit at 6 year low, qualitative budget adjustments, most savings from removal of energy subsidy? Petronas' dividend slightly lower as calculated on last year's prices. PETRONAS quashes talk of plan to cut 10% of its workforce.
29 January clarification:
An economist friend confirms that the energy subsidy cut savings was already built into models and known with effect for Dec 2014; so the recent budget revisions would not reflect such savings
Petronas Says NST's Job Cuts Article is 'Misreported and Inaccurate' by Rigzone Staff Tuesday, January 20, 2015; Malaysia's state-owned Petroliam Nasional Berhad (Petronas) clarified Sunday that a local newspaper's article published Saturday saying that the firm plans to trim its workforce by more than 10 percent was "misreported and inaccurate", the firm said in a press release.... In an article entitled "Petronas Trimming Expenditure," the New Straits Times (NST) reported that the Malaysian national oil company plans to reduce its workforce by around one-tenth "as part of measures to lower operating cost in response to the plunging global oil prices," the newspaper said, citing unnamed company officials.... "The downsizing and restructuring would include axing redundant positions and underperforming staff," the NST article revealed, quoting a company official who disclosed that these issues were raised at a senior management briefing last week that was led by Petronas CEO Shamsul Azhar Abbas....
http://www.rigzone.com/news/oil_gas/a/136842/Petronas_Says_NSTs_Job_Cuts_Article_is_Misreported_and_Inaccurate#sthash.kyZZj5g5.dpuf
Petronas’ dividend ‘slightly lower’ this year Published: 20 January 2015 4:07 PM. Petronas' dividend contribution to the government this year will be slightly lower than the previous contribution as the amount would be calculated based on last year's crude oil price. Dispelling misconceptions that the national oil corporation's contribution to the government would be severely slashed due to the slump in crude oil prices, Treasury Secretary-General Tan Sri Dr Mohd Irwan Serigar Abdullah said the amount, which has been decided by Petronas, would be announced soon. "Last year, the price was strong whereby in June Brent crude oil was sold at US$115 per barrel. googletag.cmd.push(function() {googletag.display('div-gpt-ad-1400601790726-3');}); "It (amount) will be slightly lower, but not that much of a drop in dividends," he told reporters after a briefing on the special address on measures to strengthen Malaysia's economic resilience by Prime Minister Datuk Seri Najib Tun Razak today...
http://www.themalaysianinsider.com/business/article/petronas-dividend-slightly-lower-this-year#sthash.Ijo9EZtx.dpuf
A downgrade to GDP growth outlook and some trimming of the federal budget (including a move to defer the National Service programme, which would save the country RM400 million) and qualitative changes. Chatting with analyst friend at lunch, the quick reaction was that the oil price drop impact is likely mitigated in large part by the removal of energy subsidies - on fuel subsidy alone that saves some RM11 billion, and more also saved on gas subsidies. Last year some RM70 billion came to the federal budget from PETRONAS.
What is Putrajaya cutting from Budget 2015? By Ida Lim Published: January 20, 2015 12:07 PMUPDATED: January 20, 2015 02:33 pm; He said that the government stood to save RM10.7 billion by removing direct fuel subsidies for the public and using the managed float mechanism for RON95 petrol and diesel. - See more at:
http://www.themalaymailonline.com/malaysia/article/what-is-putrajaya-cutting-from-budget-2015#sthash.c0QA6w6M.dpuf
PM announces measures to strengthen Malaysia's economic resilience Last updated on 20 January 2015 - 09:18pm; In a special address this morning, Najib said that the government remained confident that the country's gross domestic product (GDP) will grow by between 4.5% to 5.5% in 2015. Meanwhile, in light of falling oil prices, volatile capital flows and a worsening global economic outlook, the prime minister also announced that Malaysia's fiscal deficit target would be revised to 3.2% of GDP in 2015.... "It is higher than the three per cent set out in the Budget, but lower than the 3.5% in 2014, and in line with the government's continuing commitment to fiscal consolidation," said Najib.... The development expenditure for 2015 meanwhile would be fully maintained, but operating expenditure is expected to be reduced by RM5.5 billion, he said. The government will also encourage government-linked-companies (GLCs) and government-linked investment companies (GLICs) to invest domestically; further reduce the cost of doing business; allocate 30% of the annual procurement budget of government agencies and GLCs for goods and services to local SME producers; and increase local goods and services in government procurement.
http://www.thesundaily.my/news/1301381
Highlights of PM's special address on the economy Last updated on 20 January 2015 - 03:23pm
* Malaysia is a crude oil exporter. Thus, when oil prices plummeted recently, there was a perception that export receipts will also decline drastically and result in a current account deficit. Indeed, this perception is not correct.
* As a net crude oil exporter, Malaysia had a surplus of RM7.7 billion from January to November 2014.
* Malaysia is an importer of petroleum products with a net import bill of RM8.9 billion during the same period.
* The perception that Malaysia is a large oil producer is also not true
http://www.thesundaily.my/news/1301422
Ringgit extends losses against US dollar at close - Bernama Last updated on 20 January 2015 - 07:27pm; At 5pm, the local note was quoted at 3.6060/6730 against the greenback compared with 3.5700/5590 on Monday. A dealer said the ringgit hit a near six-year low after the government increased its fiscal deficit target to 3.2 per cent of gross domestic product and cut forecast economic growth and inflation this year to adjust the country's budget after a sharp fall in earnings from oil and gas....
http://www.thesundaily.my/news/1302135
18 January 2015: Najib to hold 20 January talk but consensus that Malaysia can hold up with removal energy subsidies and new 6% GST; some concern over impact of PETRONAS Sarawak gas pipeline explosion in June 2014 on its earnings
This Is Asia's 'Undisputed Loser' From Oil and Fiscal Cuts Are Looming By Sharon Chen and Liau Y-Sing Jan 16, 2015 10:44 AM GMT+0800; The plunge in oil prices that spurred a currency crisis in Russia and endangered Venezuela’s leadership is also roiling markets in Malaysia, a net oil exporter in Southeast Asia. Economists say it’s not time to panic, yet.... For one thing, Malaysia’s oil and gas products account for about 22 percent of its exports, compared with more than 70 percent for Russia’s energy. For another, Prime Minister Najib Razak is buying some fiscal breathing room by abolishing decades-old energy subsidies and introducing a 6 percent goods and services tax in April, according to Nomura Holdings Inc..... That would allow Najib to keep close to his budget goals even as declining investor confidence pushed the currency this week to its lowest level since April 2009 and boosted the cost of insuring the nation’s debt.... Najib will hold a special session to talk about economic developments and the country’s financial position on Jan. 20, the finance ministry said. With crude prices at half the level of a year ago, the pressure will be on him to accelerate the restructuring of an economy grappling with a cash squeeze and elevated household debt and further reduce the nation’s dependence on oil....
http://www.bloomberg.com/news/2015-01-16/meet-asia-s-undisputed-loser-from-oil-where-fiscal-cuts-loom.html
Baru wants Petronas to clarify rumour on February LNG sale – BorneoPost Online | Borneo , Malaysia, Sarawak Daily News | Largest English Daily In Borneo -
http://www.theborneopost.com/2015/01/06/baru-wants-petronas-to-clarify-
Petronas' evaluation of SSGP ongoing - Business News | The Star Online -
http://www.thestar.com.my/Business/Business-News/2015/01/12/PETRONAS-EVALUATION-OF-SSGP-ONGOING/?style=biz
Sarawak PKR chief demands answers from Petronas over pipeline explosion - The Malaysian Insider -
http://www.themalaysianinsider.com/malaysia/article/state-pkr-chief-demands-answers-from-petronas-over-pipeline-explosion
Portion of Petronas RM3bil Kimanis-Bintulu pipeline project exploded (photos) - Bintulu Weekly - News, Opinions and Multimedia -
http://www.bintulu.org/2014/06/10/portion-of-petronas-rm3bil-kimanis-bintulu-pipeline-project-exploded.php
13 January 2015 evening: Najib says Budget 2015 may be revised next week
Putrajaya might tweak Budget 2015 in face of falling oil prices, flood aid Published: 13 January 2015 Prime Minister Datuk Seri Najib Razak says today Budget 2015 might be revised because of unexpected major events. Falling global oil prices and a weakening ringgit have forced Putrajaya to relook Budget 2015. The recent flood in the east coast states might also affect government spending after it said it would spend RM800 million for flood relief. Prime Minister Datuk Seri Najib Razak said today the budget might be restructured in view of current developments, national news agency Bernama reported today. "I will come out with a statement (on this) next week," he said after receiving flood relief assistance from China today.....Treasury had ordered all government-linked companies and statutory bodies to hold off foreign purchases in response to falling global oil prices and a weakening ringgit. "After taking into consideration the uncertain world economic outlook in 2015, the government on December 17 is of the opinion that domestic consumption must be increased to generate and support the country's economy," according to the Treasury circular.... http://www.themalaysianinsider.com/malaysia/article/possibility-2015-budget-will-be-restructured-says-najib-bernama#sthash.2akSW6Uh.dpuf
13 January 2015: World Bank sees significant risk for Malaysia with 1.5%-age point drop in key balances versus GDP if Brent average $63.80 in 2015; talk of naivety of fossil fuel "get rich quick" schemes in Greenland and Norway on alert, looking at tapping reserves and observations on need to revamp government spending
Thanks to reader N who pointed out World Bank Economic Report Dec 2014 to me on Malaysia. It analyzes the impact of lower oil and gas prices as significant for Malaysia at the $75 and $63.80 levels for Brent for 2015. Currently, that's trading just below $50 and we'll have to see how average prices pan out in 2015.
source: World Bank Malaysia Economic Monitor December 2014
Elsewhere, talk of naivety of fossil fuel "get rich quick" schemes in Greenland and Norway on alert, looking at tapping reserves and observations on need to revamp government spending
$50 Oil Kills Bonanza Dream That Made Greenlanders Millionaires By Peter Levring Jan 12, 2015 7:00 AM GMT+0800 Greenland, an island that may be sitting on trillions of dollars of oil, has had to acknowledge that its dream of tapping into that wealth looks increasingly far-fetched. Back when oil was headed for $150 a barrel, Greenlanders girded for a production boom after inviting in some of the world’s biggest explorers, including Chevron Corp. and Exxon Mobil Corp. (XOM) Now, with Brent crude dipping below $50 last week, Deputy Prime Minister Andreas Uldum says Greenland’s hope of growing rich quickly on fossil fuels was “naïve.” ...
://www.bloomberg.com/news/2015-01-11/-50-oil-kills-bonanza-dream-that-made-greenlanders-millionaires.html
Oil Losses Force Norway to Consider Measures to Back Economy By Mikael Holter, Saleha Mohsin and Jonas Cho Walsgard Jan 9, 2015 6:37 PM GMT+0800; Norway is considering tapping reserve funds to shield western Europe’s biggest oil producer from the worst slump in crude prices in more than half a decade.... Prime Minister Erna Solberg said the government is now “on alert” to respond to the rout. “If the economic situation requires it, we can react quickly,” she said yesterday at a conference in Oslo organized by Norway’s confederation of industry. Erna Solberg, Norway's Prime Minister, said her government is working on models that...
http://www.bloomberg.com/news/2015-01-08/norway-on-alert-as-oil-losses-have-government-exploring-options.html
Hayman’s Bass Sees Oil Slump Disciplining Petro-State Norway By Saleha Mohsin Jan 8, 2015 5:20 PM GMT+0800; Hayman Capital Management founder and chief investment officer Kyle Bass said, Norway... The oil rout that has dragged down Norway’s krone since June will ultimately discipline a government that has relied too much on its petro-dollars to finance expenditure.
That’s according to Kyle Bass, the founder and chief investment officer of Hayman Capital Management LP, who was in Oslo yesterday to attend a Skagen AS conference.... Norway “trades like an emerging market because of its dependence on crude,” Bass, one of the first hedge-fund managers to predict and make money on the U.S. subprime mortgage crisis, said in an interview. “A traditional cleansing is a good thing in the long run, it keeps government spending in check. Politicians are going to have to figure out how to cut back on the spending that they shouldn’t have been doing in the first place.” ....
http://www.bloomberg.com/news/2015-01-07/hayman-s-bass-says-oil-plunge-will-discipline-petro-state-norway.html
10 January 2015: Petronas’ quarterly results avidly awaited, How bad will it be? Malaysia oil and gas companies planning to lobby that PETRONAS stop awarding contracts to foreign companies.
How low will Petronas profits dip? Saturday, 10 January 2015 By: M.SHANMUGAM; A clearer picture will emerge on the impact that the almost 50% drop in the price of crude oil over the last six months has had on the coffers of the Federal Government when Petroliam Nasional Bhd (Petronas) unveils its next quarterly results... Everybody knows that Petronas is not going to show a sterling set of numbers. When Petronas released its third-quarter results on Nov 28, 2014, it had already sent a clear message that the final quarter would be bad. The question is: How bad will it be?... As at end-November, Shamsul had predicted Brent Crude to stabilise between US$70 and US$75 per barrel.
At the upper limit of US$75, Petronas’ payout to the Government in the form of dividends, taxes and royalties would be RM43bil.... But now, it would appear that the best-case scenario for Brent Crude next year is US$75 and not many are betting on that price.... The domestic oil service providers have stopped forecasting the price, while global oil majors have not discounted US$60 or below as the average.... So, even a prospective payout of RM43bil to the Government this year is looking rather shaky. Previously, Petronas’ quarterly results used to be a mundane affair. But surely, it is not going to be the same this year, as all eyes will be on how low its profits have dipped...
http://www.thestar.com.my/Business/Business-News/2015/01/10/How-low-will-Petronas-profits-dip/?style=biz
Source: The Edge Malaysia, 12 January 2015
Note:
Some local companies have suggested that they be allowed to at least match the bids of the foreign companies. However, there is no indication to date of Petronas bowing to political pressure... The national oil company has in the past come under fire for awarding jobs to foreign companies such as Hyundai. These awards are said to have resulted in Malaysian companies that did not win the contracts labouring to make ends meet. However Petronas has stood firm, looking at improving its cost efficiency... In 2013, Petronas paid the government some RM63 billion, contributing 29.5% to tis revenue. The sum comprised RM36 billion in tax income and royalties, and RM27 billion in dividends... However, The Edge understands that Malaysian oil and gas companies are planning to collectively lobby the Ministry of Finance (MoF) to ensure that Petronas contracts are not awarded to foreign companies... Late last year, the MoF had asked government-linked companies (GLCs) to refrain from acquiring assets in foreign countries in order to stem capital outflow... In this vein, the local oil and gas companies argue that Petronas too should not award jobs to foreign companies....
9 January 2015: PETRONAS wants to slash OPEX by 30%
After slashing capex, Petronas plans up to 30% cut in opex By: JAGDEV SINGH SIDHU, NG BEI SHAN; Wednesday, 7 January 2015; PETALING JAYA: Petroliam Nasional Bhd (Petronas) is looking to make cuts in its operating expenditure (opex) by between 25% and 30% to preserve its profitablity as crude oil prices continue to tumble.... Sources said that the national oil company was reviewing its spending and was in the process of identifying where cuts could be made. Projects it has committed to from last year and in its budget are likely to continue.... Oil company executives said word was starting to filter to them that cuts in opex would be made as the price of crude oil continues to fall. As the price of Brent crude oil was falling and at US$70 a barrel late November last year, Petronas said it would slash its capital expenditure (capex) up to 15% this year.... With the price of global crude oil now at around US$50 a barrel, more oil majors have announced cuts in not only capex but also their opex, which includes payroll....
http://www.thestar.com.my/Business/Business-News/2015/01/07/Another-cut-After-slashing-capex-Petronas-is-now-looking-at-reducing-operating-expenditure/?style=biz
7 January 2015: Oil & gas work has been in favour, energy companies drop with oil price plunge
From Mat Rempit to being an offshore rig worker Updated: Wednesday January 7, 2015 MYT 7:13:03 AM; BANGI: When he was a teenager, Mohd Ikhwan Iskandar would spend his nights racing bikes on the highways and his days loitering in shopping malls. Now 23, he is a new man of sorts especially after signing up for Kem Perkasa, an intervention programme for the so-called Mat Rempit. “I wanted to change and become a better person,” he said in an interview at the camp’s “graduation ceremony” at Universiti Kebangsaan Malaysia (UKM) here yesterday. He said the intervention programme was “life-changing” as he made new friends, learnt vocational skills and gained an insight into his own character. “Now I am working on an offshore rig. My parents used to tell me don’t just sit at home, go study or get a job. Now I can support them and they’re very happy,” he said.... Datin Seri Rosmah Mansor was present yesterday at the camp organised by Permata, an initiative on early child care, and UKM’s Centre for Youth Empowerment, assisted by the Youth and Sports Ministry. Rosmah, who heads Permata, also launched camp coordinator Dr Rozmi Ismail’s book on Rempit di Malaysia.... “The ‘alumni’ of Kem Perkasa had gone on to become fitness instructors, chefs and managers of entertainment centres,” she said....
http://www.thestar.com.my/News/Nation/2015/01/07/From-Mat-Rempit-to-being-an-offshore-rig-worker/
Asian Stocks Extend Drop, Led by Energy Companies on Oil Plunge By Jonathan Burgos Jan 7, 2015 8:10 AM GMT+0800 Asian stocks fell, after yesterday sinking the most in nine months, as U.S. equities extended declines and the slump in crude oil deepened. The MSCI Asia Pacific Index (MXAP) declined 0.3 percent to 134.57 as of 9:03 a.m. in Tokyo, with energy companies dropping the most. The Asian gauge slumped 1.7 percent yesterday and the Standard & Poor’s 500 Index fell for a fifth day, extending the longest losing streak in 13 months. West Texas Intermediate oil sank below $48 a barrel in New York amid speculation data on U.S. supplies today will fuel concern over a global glut....
http://www.bloomberg.com/news/2015-01-07/asian-stocks-extend-drop-led-by-energy-companies-on-oil-plunge.html
16 December 2014: Petronas' newer foreign investments in question?
Low oil prices, domestic politics put Petronas’s B.C. LNG project at risk by Ng Weng Hoong, Special to Financial Post | December 15, 2014; "VANCOUVER – The announcement by Petronas Berhad this month to delay its final decision on whether to invest $36-billion in a Canadian LNG export project may be just that — a delay. But it could also be a sign the Malaysian national energy company is caught in a difficult pinch between collapsing global energy prices and political turbulence back home undermining Petronas’s global expansion plans.... With those two pressures together, the planned Lelu Island project near Prince Rupert in British Columbia appears to be very much in the company’s — and the country’s — crosshairs. Analysts say the case for a major Canadian LNG-export project is rapidly weakening amid the energy price collapse, the emergence of the United States as an oil and gas supplier and the advanced state of competing projects in Qatar, Australia, Russia and even Papua New Guinea and Angola............ With the coming expiry of some long-term sales contracts with Asian customers and the development of new capacity in Australia and Malaysia, Petronas will have as much as 26 million tonnes of flexible and tradeable LNG capacity by 2022. Even without PNW LNG, Petronas will still have nearly 20 million tonnes of capacity, Mr. Chong said.... Days before the deadline for its final investment decision, the company said it was deferring the 12-million tonnes/year project despite having secured agreements with the B.C. government............“The U.S. factor emerged strongly in 2014,” Mr. Munro said. “We have a very competitive neighbour, which has raised the odds against the development of a major Canadian-LNG export industry.”... Petronas is under pressure to increase investments back home largely to placate powerful politicians and counter Malaysia’s slowing economy. As a result of reduced earnings from lower oil prices, the company’s expected reduced contributions to the economy next year could spark criticism following its recent costly forays into Canada, Brazil and Venezuela... At Petronas’s third quarter results briefing last month, CEO and President Shamsul Azhar Abbas warned of a 15% to 20% cutback in next year’s capital expenditure, and a 37% reduction in oil-based payments to the government if Brent crude averaged US$75 a barrel. Brent is now trading below US$65......... While the company was unhappy with what it saw as a delay by the B.C. government in announcing its final LNG tax rules, it also gave itself the herculean task of completing the massive greenfield project from conception in 2013 to plant start-up within five years.... Lacking experience with North America’s regulatory, aboriginal, labour and environmental challenges, the company plunged into Canada’s shale sector by proposing to bet the equivalent of 10% to 12% of Malaysia’s GDP on a single project...." http://business.financialpost.com/2014/12/15/low-oil-prices-politics-put-petronass-b-c-lng-project-at-risk/?__lsa=c601-bc7f
15 December 2014: Weaker credit metrics, PETRONAS lower earnings problem for Malaysia coffers, award of Sabah onshore deals
Sharply lower oil prices is driving concerns about the oil & gas sector in Malaysia. PETRONAS has warned about a 30% reduction in earnings.
Low oil prices and high capex will weaken credit metrics for rated oil & gas firms, says Fitch
By TheEdge Markets.com / theedgemarkets.com | December 15, 2014 : 12:06 PM MYT
KUALA LUMPUR (Dec 15): Low oil prices and high capex will weaken credit metrics for rated oil and gas companies in south-east Asia, but ratings to remain stable in 2015, according to Fitch Ratings. In a report released Dec 14, Fitch said South-east Asian oil companies continued to require high capex to maintain and increase their upstream and mid-stream production capacities.
It said low oil prices would reduce their net operating cash generation in 2015, at a time when the capex flexibility of these operators is somewhat limited; http://www.theedgemarkets.com/my/article/low-oil-prices-and-high-capex-will-weaken-credit-metrics-rated-oil-gas-firms-says-fitch
Petronas juggles lower earnings By Farah Saad & Doreen Leong; Friday, 12 Dec 2014, 12:30 AM
Petroliam Nasional Bhd (Petronas) is experiencing one of the toughest challenges of its corporate history. Revenue and profit are plunging. Its RM109 bil Canadian dream gas project could become a nightmare and another RM90 bil in other projects it announced in the last five years may have to be reviewed. The slump of more than 40% in world crude oil prices in the last six months, from US$112 to US$64 per barrel, has affected its bottomline. Each US dollar fall in the world oil price has a RM1 bil impact on Petronas’ pre-tax profit. Poor market sentiment has also affected at least three of Petronas’ five listed companies – Petronas Dagangan, Petronas Chemicals and Petronas Gas, which have lost a combined market capitalisation of RM30.3 bil this year alone. The rest of the industry catches cold when Petronas sneezes. When the oil company announced a 15-20% cut in its capex on Dec 1, oil-and-gas stocks on Bursa Malaysia fell by 5-20% the next day.... http://www.focusmalaysia.my/Mainstream/Petronas%20juggles%20lower%20earnings#sthash.mPrlQw7C.dpuf
Petronas urges Putrajaya to 'tighten belt' over possible lower ...Nov 28, 2014 - Petronas pre-tax profit fell 12% in the third quarter ended September 30, 2014, against the previous quarter this year. - The Malaysian Insider ... Petroliam Nasional Bhd (Petronas), which contributes to almost 40% of the national coffer, is urging the government to "tighten its belt" as the national oil firm is facing the possibility of less earnings in light of the falling crude oil prices. Petronas president & Group chief executive officer Tan Sri Shamsul Azhar Abbas (pic) believes that the price range of Brent crude oil at US$70 (RM237) to US$75 may be a 'new era', until the end of next year, if not for the next two years. Based on the new oil price assumptions, Shamsul said Petronas is looking to cut as much as 15%-20% of its capital expenditure (capex) budget for next year. Shamsul also called on the government to be prudent on its spending as the state oil firm has to safeguard its growth plans. "If we are to maintain our dividend contribution or higher, it would significantly impact our growth plans," said the chieftain at Petronas' third quarter results briefing today..... http://www.themalaysianinsider.com/malaysia/article/petronas-urges-putrajaya-to-tighten-belt-over-possible-lower-dividend
‘Lower oil price is a reality check’ By Cynthia Blemin / The Edge Financial Daily | December 11, 2014 : 9:30 AM MYT “Our dependency on O&G has been reduced over the years,” he said, adding that Malaysia is now a broad-based economy which will help to ride the current fluctuations in the oil price. Wahid said that the country has also managed to reduce its dependence on oil revenues. “Back in 2009, we were at 40% in terms of contribution from oil revenues and that has been reduced to 36% in 2011 and 31% in 2013,” Abdul Wahid added....http://www.theedgemarkets.com/my/article/‘lower-oil-price-reality-check’
Sunday, December 7, 2014; Sabah news (update 6): Sabah onshore oil & gas, the oil royalty push, secession talk is sedition; 7 December 2014: Sabah onshore oil & gas, the oil royalty push, secession talk is sedition: News is out - we had been hearing about talk of this from friends in the oil & gas industry for some time now. Is there big onshore oil & gas in Sabah? Notably in the vicinity of Sahabat? Sabah signed oil and gas production sharing contracts (PSCs) effective 20 November 2014 for 27 years. Petronas awarded.... http://khoryuleng.blogspot.com/2014/08/sabah-sulu-problems-fester-on.html
29 June 2014: Petronas RAPID project in Johor
There is considerable and growing interest in the PETRONAS Rapid project in the south eastern coast of Johore, just north of Singapore. Some useful links on public information and academic sources are put together here. Broadly, while the project is said to be complementary to Singapore's oil and petrochemical hub role there are many who also view it as potentially competitive, especially in light of relatively stagnant growth in this sector for Singapore. Industry veterans do point to general over capacity in refining in the region and the shifting economics of the oil and derivatives trade, given large investments in China and India and also the changes triggered by the US shale gas revolution[1]. Pengerang terminal's deepwater jetty with a draft of up to 24 meters to berth one VLCC, is due by the end of 2014. Companies doing ventures with PETRONAS at Pengerang include Evonik and Itochu; whilst BASF declined. What's interesting are also some Malaysia Federal versus State kerfuffles[2].
[1] WSJ 25 June 2014 19:14: "The Obama administration cleared the way for the first exports of unrefined American oil in four decades. We report that the Commerce Department gave Pioneer Natural Resources Co. and Enterprise Products Partners LP permission to ship a type of ultralight oil known as condensate to foreign buyers, in separate rulings that haven't yet been announced. Our story considers the implications of the decisions, which allow energy companies to start chipping away at the longtime ban on selling U.S. oil abroad. Shipments, we note, could begin as soon as August, though they are likely to be small and it isn't clear how much oil the two companies are allowed to export. Meanwhile, we find that the fracking boom has its downside as refineries are starting to complain that oil extracted from shale formations is quite hard to handle with existing equipment because it's full of volatile gases that make it tricky to transport and to process into fuel."
[2] View our posting here: http://khoryuleng.blogspot.com/2014/06/johor-iskandar-policy-admin-moves.html
PETRONAS REACHES FINAL INVESTMENT DECISION FOR PENGERANG INTEGRATED COMPLEX, 3 April 2014:
"Based on the current progress, the project is poised for its refinery start-up
by early 2019. The project will further strengthen PETRONAS’ position as a key
player in the Asian chemicals market, focusing on key growth areas of
differentiated and specialty chemicals and capturing the growing automotive,
pharmaceutical and consumer products sectors. Domestically, the PIC will
contribute towards meeting the growing demands for petroleum products and Euro
4M and Euro 5 specification fuels." Link to press release: http://www.petronas.com.my/media-relations/media-releases/Pages/article/PETRONAS-REACHES-FINAL-INVESTMENT-DECISION-FOR-PENGERANG-INTEGRATED-COMPLEX.aspx
Readers might be interested in some recent back history on Petronas. Released in February 2011, our report entitled "PETRONAS: Briefing on Petronas' new strategy," update on new marginal field contract and issues on its Sudan concessions with the impending secession of South Sudan expected in mid-2011. Download here:
https://sites.google.com/site/khorreports2011/home/Malaysia_briefings/khorreports-malaysia001-petronas-1102.pdf?attredirects=0&d=1
Across in Singapore, there was a proposal for a 4th refinery by Hin Leong (to be sized larger, possibly at 500,000), but that seems shelved having gone rather quiet for a while. News links include (from older to newer):
Note: our annotations include yellow highlight of PETRONAS Rapid project area and red circled approximate area of Country Garden's land reclamation project. Notable that the Rapid project zone looks to be bigger than Singapore's Jurong Island. Legend removed - please do go to the original map source. Map source: "THE EXTENDED STRAIT - Singapore's Oil Hub" by Martin Garcia and Magnus Nickl, Draft Version. Which notes that the key oil hubs in the Malacca Straits are: "1. Port Klang: Port Klang is divided mainly in two ports, each one with its own operator. These are called the North Port and the West Port. Both have oil tank facilities of considerable dimensions. Port Klang is the biggest oil storage harbour in the Strait of Malacca. 2. Port Dickson: Port Dickson is one of the locations of Royal Dutch Shell in Southeast Asia and ExxonMobil, each of them running a refinery at this location. 3. Malacca Oil Storage Terminal: Very near Malacca in Sungai Udang petronas erected a refinery taking a large part of the terrain. Through one major jetty the tankers that brings the crude oil and takes the refining products can dock perfectly even if the depth are quite small. 4. Jurong Island in Singapore: Jurong Island of Singapore is the biggest oil and petrochemical hub in the region and is the preffered location for bunkering of both tankers and cargo vessels because a lot of their main operative actions take place in Singapore."
Dialog Group is leading the oil storage thrust in Johore with key JV partners. There are several other storage projects in Johore, and some seem likely to compete with each other, while several are part of Dialog (company website link: http://www.dialogasia.com/core_CTF.htm). The Dialog JVs seem akin to the Tanjung Pelepas move in Johore in the late 1990s when two key container line operators were encouraged to relocate from Singapore. The latest news, is that Malaysia's Pengerang oil terminal seeks to extend its storage to biodiesel and LNG too.
Related to this are large Johore land reclamation projects (located off Singapore's western tip) that are apparently raising new transboundary questions. Specialists tell us that congestion in maritime traffic is resulting in a rise in the number of vessel collisions in the waters off Johore - Singapore.
NST news link: http://www.nst.com.my/node/5883; "The Department of Environment has issued a temporary stop-work order against all coastal land reclamation works for the development of the massive Forest City off Tanjung Kupang here pending a detailed study.... State Health and Environment Committee chairman Datuk Ayub Rahmat said any negotiation on lifting the suspension would be between the department and the project’s joint developers, China’s Country Garden Holdings Co Ltd and state-owned Kumpulan Prasarana Rakyat Johor... The project hit a snag after the Singaporean government raised concerns over the state’s coastal land reclamation projects, citing that it might cause trans-boundary issues...."[3]
[3] Other land reclamation (non-oil & gas sector) in Danga Bay area, just west of Johor Bahru town: Land and development on man-made Danga Bay island to cost RM8bil, Published: Tuesday February 19, 2013 MYT 12:00:00 AM; http://www.thestar.com.my/Business/Business-News/2013/02/19/Land-and-development-on-manmade-Danga-Bay-island-to-cost-RM8bil/
