May 20 2015 | By: Carl Surran, SA News Editor
Shell joins BP in calls against excessive oil trading regulation
Seeking Alpha
Shell joins BP in calls against excessive oil trading regulation
Environmentalists score a little discussed big win in Arctic drilling plans
May 19 2015, 14:48 ET | By: Carl Surran, SA News Editor
Environmentalists score a little discussed big win in Arctic drilling plans
Shell vows to explore Arctic, rips environmental critics
May 19 2015, 12:53 ET | By: Carl Surran, SA News Editor
Shell vows to explore Arctic, rips environmental critics
Energy groups ax $100B in total spending after oil rout
Article by: Carl Surran, SA News Editor, Seeking Alpha: 18 May 2015
Energy groups ax $100B in total spending after oil rout
- More than $100B of spending on at least 26 major projects by the world’s energy companies has been slowed, postponed or canceled in the wake of plunging oil prices, including Royal Dutch Shell (RDS.A, RDS.B), BP, ConocoPhillips (NYSE:COP) and Statoil (NYSE:STO), according to a Financial Times analysis.
- One of the biggest developments to be shelved, Shell’s Arrow liquefied natural gas plant in Australia, accounted for almost a quarter of the planned spending reduction.
- Western Canada is suffering the most from the retrenchment, with nine Canadian oil sands projects pulled back, each ranging from $1B-$10B in planned expenditure, the analysis says.
- According to Morgan Stanley, which looked at capex guidance for 2015 from more than 120 companies, investment is expected to drop by a quarter this year to $389B from $520B.
Latest on Royal Dutch Shell plc (RDS.A: Get latest price)
Obama said to seek oil demand, climate balance with Shell Arctic permitMon, May 18 Opportune Time For Oil And Gas Exposure
Mon, May 18 Australia – LNG Growth Will Become Significant
Mon, May 18 5 Top Dividend Global Dogs Show 9% To 39% May Upsides
Mon, May 18 Wall Street Breakfast: Shell May Have To Sell BG’s Kazakh ‘Cash-Cow’
Mon, May 18
Shell might have to sell BG “cash-cow” in Kazakhstan
The Exxon Mobil-BP Merger Rumor That Just Won’t Go Away
SeekingAlpha.com article by Dave Dierking published 15 April 2015
The Exxon Mobil-BP Merger Rumor That Just Won’t Go Away
Summary
- The rumors of the viability of an Exxon Mobil-BP merger surfaced once again recently following the Royal Dutch Shell-BG merger.
- Exxon Mobil could be compelled to make such a transaction due to BP’s relatively inexpensive valuation and the tens of millions of dollars in cost savings a merger would create.
- The potential scope and size of such a merger – the combined entity would be worth close to $500B – make it unlikely to occur.
- Exxon Mobil could be turned off by BP’s outstanding litigation concerns and costs as well as BP’s Russian investment in Rosneft.
Even well before Royal Dutch Shell (NYSE:RDS.A) made a $70 billion bid to buy BG (NYSE:BG), talks of the merger & acquisition market in the energy sector heating up have persisted for months. The Shell-BG merger it’s thought could just be the first domino.
Analysts are keeping an eye on other big name oil companies like Exxon Mobil (NYSE:XOM) and BP (NYSE:BP) as other firms that could be looking to make an acquisition or even combine in a merger themselves. Logically speaking, it would make more sense for the two companies to make acquisitions themselves to fill in holes in their businesses where they might be lacking. As oil prices have plunged, the value of energy stocks have dropped as well and the perception could be that many of these companies are now “on sale” and could fuel this additional M&A discussion.
A Frank Discussion On Royal Dutch Shell’s Dividend
SeekingAlpha.com article published 13 April 2015
A Frank Discussion On Royal Dutch Shell’s Dividend
Summary
- Before the BG acquisition, Royal Dutch Shell had a dividend payout ratio of 90% for 2015.
- The acquisition of BG Group will put Shell on the hook for $15 billion in annual dividends as BG shareholders will own 19% of the company.
- Royal Dutch Shell has built up a large cash position and indicated a desire to maintain the current dividend for the rest of 2015, making no dividend promises thereafter.
Before Shell (NYSE:RDS.B) announced an intention to purchase BG Group (OTCQX:BRGYY), the downtick in oil prices had created a very thin gap between the company’s dividend payout obligations and annual profits. Shell is on the hook for paying $11.8 billion in annual dividends to shareholders. For most of the past five years, this high dividend payout wasn’t an issue — Shell made well over $20 billion in profits annually between 2010 and 2012, so the current payout wouldn’t have even consumed half of the profits.
Shell And BG Group: Strong Strategic Fit, But Additional Financial Risks Ahead
Article by Pim Keulen published 12 April 2015 by Seeking Alpha
Shell And BG Group: Strong Strategic Fit, But Additional Financial Risks Ahead
Source: total.com
Summary
- Shell announced the acquisition of BG Group for the amount of $69 billion.
- From a strategic point of view, the deal seems to make perfect sense.
- From a financial point of view, the deal has a long-term horizon with accompanying risks.
- It will come down to management’s capabilities to deliver the outlined financial metrics in order to make this deal work for shareholders.
Last week, Royal Dutch Shell (RDS.A, RDS.B) announced the acquisition BG Group (OTCPK:BRGXF) for a total sum of $69 billion. Despite heavy M&A activity, this deal is the largest M&A deal announced this year. Both analysts and contributors on Seeking Alpha have discussed the metrics of Shell’s acquisition. However, the reactions are somewhat mixed. As I cover Shell on a regular basis, I would like to share my point of view regarding the BG Group acquisition.
Europe fails to impose tough sanctions on Russia
Extract from a Seeking Alpha article published 23 July 2014
EU foreign ministers failed to impose any tough sanctions against Russia during a meeting of the bloc’s foreign ministers yesterday, NYT reports.
Dependent on Russia’s energy and wary of confrontation, Europe’s leaders have largely decided they will have to live with a newly assertive Russia.
The Netherlands lost at least 193 victims in the Malaysian Airlines crash over Ukraine, but Royal Dutch Shell is one of the largest foreign investors in Russian gas fields in Siberia; if Shell loses money, the pensions of Dutch teachers, civil servants and many others suffer.
Shrinking Giants: Royal Dutch Shell long list of abandoned projects
A total of $15 billion worth of assets are expected to be sold this year and next, including petrol stations in Australia, offshore production capacity shares in Brazil, pipelines and a host of other assets (link). Problem is that many of the projects were meant to boost production both upstream and downstream, which means that most likely Shell will not be able to stem a steady long-term production decline.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Royal Dutch Shell (RDS.A) (RDS.B):
While in 2012 total production of oil and gas increased by about 47,000 barrels of oil equivalent, it seems that Shell production declined for 2013 by 1.8% compared to 2012 and fourth quarter decline was 4.7%, compared to the fourth quarter of 2012. This decline will probably continue into 2014 and perhaps beyond as Shell actually tries to divest from many projects which were hoped to bring more production online (link).
Did BP, Shell, Statoil, And Others Fix Oil Prices?
Did BP, Shell, Statoil, And Others Fix Oil Prices And Behave Anti-Competitively?
By Werner Kranenburg: Oct 30 2013, 13:46
In legal proceedings, which may prove critical for both physical oil traders and traders in oil-related financial instruments, who should take note for their own possible action, the focus of attention has of last week firmly shifted to a federal trial court in Manhattan for now. The European Commission stating that “[e]ven small distortions of assessed prices may have a huge impact on the prices of crude oil…” concerns all involved and, besides governmental authorities, market participants have their role to play as well in ensuring the integrity of benchmarks and fairness of competition such as through the courts.
SEC’s New Plan Could Revamp Oil and Gas Reporting Rules
Analysts expect that Royal Dutch Shell (RDS.A) is likely to benefit the most among the oil majors, given that they are investing capital to retrieve crude from bitumen-soaked soil in Canada, as well as extract natural gas in coal beds in Australia and China, both of which can now be included as reported proven reserves.
Has Oil Production Reached a ‘De Facto’ Peak?
Im not sure what to call the peak we have now reached. Maybe it should be called Peak Practical Production. Or De Facto Peak Oil. Or just, Th..Th..Thats All, Folks.
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