BusinessDay 22 Aug 2018

Wednesday 22 August 2018
06 BUSINESS DAY
C002D5556
WEST AFRICA
ENERGY intelligence
Brief
Glencore/Qatar venture values
its Rosneft stake at €7.4bn
QHG Oil Ventures,
a joint
venture between
Qatar
Investment Authority and
Glencore, has valued a
14.2 percent stake in Rosneft,
which it is selling, at
€7.4 billion ($8.4 billion),
a QHG financial statement
showed.
Under a deal sealed in
May, Qatar Investment
Authority (QIA) will buy
the 14.16 percent stake in
the Russian energy giant
from the Singapore-based
joint venture.
The stake is now
worth €4.94 per share,
nancial statement, which
covered the period between
Dec. 8 2016 and
May 31 2018, that it made
a profit of more than €672
million during that period,
mostly from Rosneft
dividends.
The 2016 sale of the
stake in Rosneft was
trumpeted by the Kremlin
at the time as a landmark
deal and vote of
confidence in the Russian
economy, despite
Western sanctions. But
the deal, from the outset,
was mired in unanswered
questions about how it
was structured.
finance people
appointments
Libyan crude still attracting hefty freight premiums
Many ship
owners
remain
wary about
transporting
Libyan cargoes due
to security concerns and
these stems are attracting
a hefty freight premium as
a result. There has been a
lot fighting around ports
between rival militias in
recent months, notably
Es Sider and Ras Lanuf in
June.
Even though the situation
is calm for now,
concerns persist and, according
to one shipowner,
“some companies have to
re-review their security policy
and it takes them time
to reconvene to discuss and
clear.”
There are three or four
shipowners who will not
call at Libyan ports and
others will view cargoes on
a case by case basis, said a
shipbroker.
This means that at
times Libyan crude stems
can attract a premium of
Worldscale 2.5 - 10 points
over cargoes loading from
non-Libyan ports in cross-
Mediterranean voyages,
depending on how many
Libya-capable vessels are
open in the region, sources
said.
“We have no issues as
long as we have a decent
Libya clause but others
have to go through the motions
and see things stabilize,”
said another shipowner.
This clause will cover
cancellation costs, such as
bunkers expended on the
voyage to the port and for
waiting times.
The other issue is the
rivalry between the government
in Tripoli and its
counterpart in the east of
the country, which also
claims authority. This has
threatened to potentially
put shipowners at odds
with the Tripoli-based
NOC if they were to take a
cargo being marketed by
its rival in the east, sources
said.
Recently, the self-styled
Libyan National Army took
control of the eastern ports
and prevented the NOC in
Tripoli from exporting any
cargoes, sources said. But
since then, the outlook has
improved, though, production
remains vulnerable to
sudden disruptions due to
security, political uncertainty
and even staffing issues.
according to QHG’s
statement, the first time
it has filed a financial
report. However, as QIA
already indirectly owns
part of the stake through
the joint venture it is unclear
how much it will
pay for the stake.
QHG was set up by
QIA and Glencore in 2016
to invest in Rosneft and
it bought a 19.5 percent
stake in the Russian company
for €10.2 billion. In
its statement, QHG said
that stake was now valued
at €10.4 billion, meaning
it has changed little in
value in two years.
QHG also said in the fi-
After the transaction
was announced in 2016, it
transpired that it was only
an interim deal, and that
a long-term buyer for the
stake had yet to be found.
Rosneft came close
to concluding a deal
with China’s CEFC last
year, but that deal ran
into trouble after CEFC
founder and chairman Ye
Jianming was put under
investigation by Chinese
authorities over suspected
economic crimes.
Eventually Qatar’s investment
fund agreed to
become the permanent
owner, resulting in the
sale agreement in May.
The world’s biggest
shipping company,
A.P. Moller-
Maersk, said it
turned in a profit, but is
now spinning off its drilling
unit as a stand-alone
company, marking its latest
step toward a complete exit
from the energy industry.
Maersk, which owns the
world’s biggest shipping
operations and is working
on turning itself into a pure
transport company, said
that the decision will take
effect next year.
Soren Skou, CEO, said
management had explored
“all options” for the drilling
unit before deciding on a
separate listing in the Danish
capital. “We believe this
will create the best value
for our shareholders,” he
said.
The 114-year-old firm
Maersk to offload drilling assets
in latest move to exit energy
has been planning a historic
break with its conglomerate
structure since
the summer of 2016. Aside
from turning its back on the
oil and gas industry following
the 2014 slump in prices,
Maersk has also sold off
shares in Danske Bank A/S
and exited a grocery business
to focus exclusively
on the container transport
industry that it dominates.
As part of the prepara-
tion for the new listing,
debt financing of $1.5 billion
from a group of international
banks has been
secured for Maersk Drilling
“to ensure a strong capital
structure,” the company
said.
Once Maersk Drilling
becomes a separate company
on the Nasdaq Copenhagen
exchange, “a material
part of the remaining
Total SA shares” will be distributed
to Maersk shareholders
in the form of cash
dividends, share buy-backs
or as a distribution of the
Total shares directly, the
company said.