2024-09-03 11:17
Horse Powertrain investment both financial and strategic, Mufti says Aramco targets M&A in downstream, LNG Extends cooperation with Aston Martin in Formula 1 Investing "hundreds of millions" in e-fuel demo plants MILAN, Sept 3 (Reuters) - State-controlled oil company Saudi Aramco (2223.SE) , opens new tab does not plan to increase its 10% stake in fuel-based engines joint venture Horse Powertrain while it continues to pursue more deals to expand its downstream presence, a senior executive told Reuters. Aramco in June agreed to buy a 10% stake in Horse Powertrain, valuing the venture with Renault (RENA.PA) , opens new tab and Geely (GEELY.UL) at around 7.40 billion euros ($8.2 billion), as part of its growing interest in the automotive industry, including in the development of so called e-fuels. "The 10% stake hits all of the boxes that we have for our financial and strategic objectives for this company," Yasser Mufti, Aramco's executive vice president for products and customers, said in an interview in Milan, where he was to follow Formula 1 Grand Prix in Monza at the weekend. "I saw a lot of speculation about that but we were always targeting a 10% stake," he said, in the first public comments by a senior Aramco executive on the company's plans for the Horse Powertrain joint-venture. Geely and Renault will each own 45% of the venture, which will supply gasoline engines, hybrid systems and gearboxes for internal combustion engine vehicles. Aramco, the world's top oil exporter, is expected to finalise the stake purchase later this year. Horse Powertrain aims to become a global supplier for automakers, which can buy "off-the-shelf" engines compatible with advanced fuels, Mufti said. "By 2050, half the (global auto) fleet will still be conventional combustion engines or hybrids". More M&A deals will come for Aramco, after those it closed in the past 12 months, which include the purchases of Chilean fuel retailer Esmax and of stakes in Gas & Oil Pakistan and U.S.-based MidOcean, its first LNG investment abroad. "We're very busy in this space," Mufti said. "The downstream business is where we have M&A opportunities and now LNG (liquefied natural gas) as well. We have targets and markets and we work with these opportunities as they come." Downstream refers to refining, and sales and marketing of oil and gas products. Last year, Aramco spent around $9 billion on acquisitions, up from $4.2 billion in 2022, according to LSEG data, and is now discussing more deals, including acquiring stakes in China's Shandong Yulong Petrolchemical and Hengli Petrochemical(600346.SS) , opens new tab. Aramco on Tuesday also announced it was broadening its partnership with the Aston Martin (AML.L) , opens new tab Formula 1 team, ahead of the 2026 implementation of new Formula 1 regulations, including requirements for sustainable fuels. Mufti said Aramco was investing "hundreds of millions" to build two demonstration facilities with partners in Saudi Arabia and Spain, to develop e-fuels, that can be used in internal combustion engine vehicles and help reduce carbon footprint. Made by synthesizing captured CO2 emissions and hydrogen produced using renewable or CO2-free electricity, e-fuels are not cheap. Their estimated cost is of 2 euros per litre , opens new tab if produced at scale, four times the typical wholesale price for petrol made from oil. The two facilities would be "excellent starting points" to help Aramco understand how to scale up e-fuels production and bring costs down, Mufti said. "I can be 100% confident that the current cost structure will be improved on dramatically". Costs of making e-fuels could fall to between 0.70-1.33 euros per litre in 2050, according to lobby group eFuel Alliance. ($1 = 0.9035 euros) Sign up here. https://www.reuters.com/markets/deals/aramco-still-pursuing-deals-while-keeping-renault-geely-engine-jv-stake-10-2024-09-03/
2024-09-03 11:12
NEW DELHI, Sept 3 (Reuters) - Indian refiner Bharat Petroleum Corp (BPCL.NS) , opens new tab and explorer Oil and Natural Gas Corp (ONGC.NS) , opens new tab are jointly exploring setting up a refinery, two sources familiar with the matter said. The talks are at a very nascent stage, the sources, who did not want to be named because they are not authorised to speak to media, said. BPCL plans to increase its integrated refining and petrochemical capacities within the next five to seven years to meet growing energy demand, its chairman told shareholders last week. Both the companies declined to comment on the development. Sign up here. https://www.reuters.com/markets/commodities/indias-bpcl-ongc-jointly-exploring-setting-up-refinery-sources-say-2024-09-03/
2024-09-03 11:02
DHAKA, Sept 3 (Reuters) - The death toll from floods in Bangladesh rose to 71 on Tuesday with millions of people still stranded in devastated areas and increasing concern about outbreaks of waterborne disease as the inundation recedes. The floods, triggered by relentless monsoon rains and runoff from upstream waterways, have wreaked havoc over the past two weeks, causing widespread destruction and affecting around five million people. More than 580,000 families are still marooned in 11 flood-hit districts, and in urgent need of food, clean water, medicine and dry clothing. Nearly 500 medical teams were helping provide treatment, with the army, air force, navy, and the border guard assisting in relief efforts. Authorities are now focusing on preventing the spread of waterborne diseases, a common aftermath of such disasters, and ensuring the availability of clean drinking water. The Directorate General of Health Services said nearly 5,000 people had been hospitalised over the past 24 hours for cases of diarrhoea, skin infections and snake bites. Heavy rain in the capital Dhaka on Tuesday swamped many districts, submerging roads in knee-deep to waist-high water, causing massive traffic jams as vehicles struggled through waterlogged streets. Crops worth 33.5 billion taka ($282 million) have been damaged, affecting more than 1.4 million farmers, according to a preliminary assessment by the agriculture ministry. A 2015 analysis by the World Bank Institute estimated that 3.5 million people in the South Asian country were at risk of annual river flooding, which has only increased in recent years due to climate change. The United Nations Children's Fund (UNICEF) has said two million children are at risk from Bangladesh's most severe flooding in three decades. UNICEF has launched an urgent appeal for $35 million to provide essential supplies to those affected. “Year after year, the lives of millions of children in Bangladesh are being devastated by floods, heatwaves and cyclones. Climate change is clearly altering children’s lives,” said Emma Brigham, Deputy Representative of UNICEF Bangladesh. ($1 = 119.0000 taka) Sign up here. https://www.reuters.com/world/asia-pacific/bangladesh-floods-leave-71-dead-fears-waterborne-disease-rise-2024-09-03/
2024-09-03 10:48
BRAUNSCHWEIG, Germany, Sept 3 (Reuters) - Former Volkswagen Chief Executive Martin Winterkorn appeared in court on Tuesday on fraud charges over the so-called dieselgate scandal, nine years after the German carmaker was found to have rigged emissions tests. Winterkorn, who was toppled from the helm of the company in September 2015 after it emerged that millions of Volkswagen cars had been manipulated to pass environmental standards, became a figurehead of the scandal, the biggest in the company's history. Tuesday marked the start of the 77-year-old's criminal trial, the culmination of a case more than five years in the making. The trial comes as the future of Volkswagen's German locations is in question, as the carmaker looks for billions of euros in savings at its namesake brand. Winterkorn was tight-lipped entering court in the central city of Braunschweig in a dark-blue suit but told reporters he was "doing very well". The criminal charges against Winterkorn include fraud, market manipulation and unlawful false testimony before a parliamentary committee. He is also alleged to have failed to inform the capital market in good time about the mass manipulation of diesel engines in 2015. Via his lawyer, Winterkorn denied the charges against him. "Our client did not defraud or harm anyone, he did not deliberately leave the capital market in the dark so that investors would be harmed, and he told the investigating committee the truth," his lawyer said. The 77-year-old has suffered from health problems, causing repeated delays to the start of the trial. It was the former CEO's first time in court since February this year, when he appeared as a witness in an investor lawsuit. He denied any involvement in decisions to install the so-called defeat devices that made harmful diesel emissions seem cleaner than they were. He has previously been questioned by an investigative committee of Germany's lower house of parliament and by law firms commissioned by Volkswagen. If found guilty, Winterkorn faces a fine or a custodial sentence. Sign up here. https://www.reuters.com/business/autos-transportation/former-vw-chief-goes-trial-nine-years-after-dieselgate-2024-09-03/
2024-09-03 10:44
Angola seeks help to reduce reliance on oil Considering bids from China, EU including green tech Beijing must find buyers for it EV and solar panels stocks Luanda looking for more investment, fewer loans BEIJING, Sept 3 (Reuters) - China needs to step up its financing for Angola if the African nation is to absorb more Chinese-made goods from solar panels to electric cars, Angola's finance minister said on Tuesday, as the former OPEC member considers vying bids from Beijing and Europe. China approved loans worth $4.61 billion to Africa last year, the first annual increase since peaking at $28.4 billion in 2016, when 68% of lending went to Angola alone, even as it began to turn off the cash spigot and move away from big-ticket infrastructure projects as resource-rich Africa struggles with a growing debt crisis and grasps for quicker financing solutions. Since quitting the Organization for Petroleum Exporting Countries (OPEC) in December, Angola has been looking for ways to firm up its finances and food security, grow its fisheries sector and attract more job-creating investment inland, Vera Daves De Sousa said in an interview with Reuters ahead of a major China-Africa summit in Beijing. The littoral state has plentiful reserves of base metals and ample agricultural resources such as sugar cane, coffee, cotton and livestock, but they have been neglected compared with oil, which accounts for 95% of its exports. China has expressed willingness to help Angola modernise its agricultural sector, grow its industries and diversify its economy in exchange for imports of more Chinese goods, but faces competition from the West. "This is a tough discussion, because in our case, this comes together with the financing solution," Daves de Sousa said. "If Angola's fiscal revenues were strong enough to allow us to choose based on the criteria of quality and price, we would have a totally different discussion." SOLAR PANEL COMPETITION Beijing's pitch would not only need to include further financing to help Luanda bring down high inflation and grow jobs in the short term, but also ensure it had robust industries it could depend on into the future, Daves De Sousa added. Otherwise, China could lose out to competition from Europe, who Daves De Sousa said required Angola to buy its wares but had been funnelling fresh financing more readily in exchange. "We will buy more solar panels from Europe because the financing is coming from there." The U.S. and Europe maintain the $19 trillion Chinese economy has overcapacity in EVs and solar panels. With Western curbs on Chinese exports looming, finding buyers for those goods is top of the agenda for Beijing as it plays host to the ninth Forum on China-Africa Cooperation Summit this week. China, the world's biggest bilateral lender, has already started tweaking conditions for its loans to the continent, setting aside more for solar farms and EV plants, while cutting back on big-ticket infrastructure. Luanda is not looking for more loans, Daves De Sousa said, instead preferring to "find a new paradigm where we do more based on private-sector engagement and through public-private partnerships". "We need to think outside the box, because the plain vanilla solutions of 'you give me money, I'll give you collateral' is done." Sign up here. https://www.reuters.com/markets/angola-weighs-rival-china-european-financing-bids-transform-economy-2024-09-03/
2024-09-03 10:26
Enbridge cuts tariffs by 11% on Mainline system for September Pipelines to ship alternative grades to offset loss of Canadian supply Canadian output expected to grow, filling excess pipeline space HOUSTON, Sept 3 (Reuters) - Pipelines that historically carry Canadian crude to the U.S. are cutting rates and looking to ship different grades of crude oil due to rising competition from the newly expanded Trans Mountain pipeline. The moves will temporarily cut the cost of transporting some of Canada's heavy crude to the U.S. Midwest and Gulf Coast next month. U.S. imports of Canadian crude hit a record in July as Trans Mountain expansion (TMX) volumes grew. Shipments on TMX started in May, sending up to 890,000 barrels per day (bpd) to Canada's Pacific Coast. About 80% of the volumes are contracted, leaving 20% available for spot shipments. With more oil moving on TMX, Canadian pipeline operator Enbridge (ENB.TO) , opens new tab said in August it will cut its tariffs for September by 11% per barrel on heavy crude moving on its Mainline system. The 3 million-bpd system ships the bulk of Canada's crude exports from Edmonton to the U.S. and is one of the main competitors to TMX. The company is not rationing pipeline space for September for the first time in over a year, with sufficient capacity available to cover all nominated barrels. Enbridge said it anticipates Mainline will be well utilized for the remainder of the year, attributing the decrease in volumes to routine oil producer and refiner maintenance. "We are starting to see the TMX impact play out for the Mainline, and therefore for systems that carry Canadian barrels to the U.S. Gulf Coast," said Dylan White, a North American crude markets analyst with researcher Wood Mackenzie. Enbridge's 190,000-bpd Spearhead and 720,000-bpd Flanagan South pipelines that deliver crude from the Mainline to Cushing storage hub in Oklahoma could likely lose volumes, analysts said. The 950,000-bpd Seaway, jointly owned by Enbridge and Enterprise Products Partners (EPD.N) , opens new tab, which ships oil from Cushing to the U.S. Gulf Coast, could also see lower flows. Seaway and Flanagan pipelines remain well utilized, Enbridge said. Pipelines like MPLX's (MPLX.N) , opens new tab Capline, a key conduit for Canadian heavy crude, will likely transport more light crude from the Bakken oilfield in North Dakota to offset the loss of Canadian heavy grades, analysts said. The 1.5 million-bpd pipeline was once the largest crude oil pipeline in the U.S. before it was reversed in 2021 to carry crude oil from north to south. MPLX declined to comment on Capline product movements. SHORT-LIVED IMPACT Delays in TMX's completion provided ample time for Canadian producers to ramp up supply, and volumes on rival pipelines are likely to pick up as Canadian oil output is expected to grow rapidly. "A combination of TMX coming online later than expected and Canadian supply ticking higher ... has elevated overall utilization on broader Canadian outbound pipelines, even as TMX has expanded overall capacity," Wood Mackenzie's White said. Output will rise about 500,000 bpd in 2025 from 2023, offsetting the additional capacity added by TMX, according to analysts from energy infrastructure firm East Daley Analytics. Excess pipeline space will be filled relatively soon, said Kristy Oleszek, director of energy analytics at East Daley. Sign up here. https://www.reuters.com/markets/commodities/trans-mountain-oil-pipeline-expansion-pushes-rivals-cut-rates-now-2024-09-03/
