Transocean Bid Gets Green Light from Aker Investors

- Transocean Bid Gets Green Light from Aker Investors

Friday, August 26, 2011
Transocean Ltd.

Transocean Services, a wholly owned subsidiary of Transocean, after receiving clearance by the Oslo Stock Exchange, launched its all cash voluntary offer (the "Offer") for 100 percent of the shares of Aker Drilling ASA ("Aker Drilling") for NOK 26.50 per share. The Offer has been made on the same terms as the previously announced voluntary offer, except that it has been made on an unconditional basis and with settlement guaranteed by a financial institution.

The Offer period begins August 26, 2011 and ends on September 23, 2011 at 11:30 a.m. (EDT), 5:30 p.m. (CEST). To date, Transocean and its affiliates have acquired 13.7% of the shares and votes in Aker Drilling, and shareholders representing 59.5% of the total share capital of Aker Drilling have given their unconditional and irrevocable pre-acceptances to the Offer.

The Offer document has been reviewed and approved by the Oslo Stock Exchange in accordance with Section 6-14 of the Norwegian Securities Trading Act. The document will also be sent to the shareholders of Aker Drilling, subject to restrictions under applicable securities laws.

The Offer and the distribution of this announcement and other information in connection with the Offer may be restricted by law in certain jurisdictions. Transocean assumes no responsibility in the event there is a violation by any person of such restrictions. Persons into whose possession this announcement or such other information should come are required to inform themselves about and to observe any such restrictions.

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Investors Wait For Next Asset To Drop In Conoco's Sales Plan

- Investors Wait For Next Asset To Drop In Conoco's Sales Plan

Thursday, June 30, 2011
Dow Jones Newswires
HOUSTON
by Isabel Ordonez & Ben Lefebvre

ConocoPhillips (COP) investors are hoping for the company to quickly unveil the next step of its plan to sell up to $17 billion in noncore assets by the end of 2012 and reinvest a bulk of the proceedings in share buybacks.

Conoco's stock outperformed rivals Exxon Mobil Corp. (XOM) and Chevron Corp. (CVX) last year after investors embraced a large-scale, two-year restructuring plan presented in late 2009 that included a $10-billion asset sale and was aimed at shoring up its finances. Conoco's shares surged more than 30% in 2010, helped by evidence that the plan was going full steam ahead. By the end of last year, the sale plan seemed to be moving along. Conoco had sold $7 billion in assets, including its stake in oil sands oil producer Syncrude Canada Ltd. and the majority of its 20% stake in Russia's oil giant Lukoil OAO for $5.82 billion. Conoco said the Lukoil proceedings were excluded from the original $10-billion asset-sale plan and that money would be used to buy back the company's own shares. Those sales went so well that the Houston-based company announced in March it will expand its planned program through 2012 by selling an additional $10 billion of older, higher-cost assets.

But after a strong start, the company has this year given few signs that the asset sale is on schedule, says Fadel Gheit, an analyst at Oppenheimer & Co. "The company is keenly aware that the market is looking for news on the progress they are making in their asset sale," he said.

Conoco still has another year to complete the plan, but uncertainty about the pace of the second phase of the asset sales is starting to take a toll on its stock. Year to date, Conoco's shares are up 9.7%, underperforming the stock of Exxon and Chevron, which are up 10.6% and 12.1%, respectively.

Some analysts believe ConocoPhillips would have to make a significant announcement by the end of July, when it will report second-quarter earnings, if it wants to maintain momentum with investors; worries will only increase the longer no announcement is made. "If they don't announce something in the third quarter, the concern could rise," says Allen Good, an analyst at Morningstar.

Others believe that it's good for shareholders that the company is taking its time to make concrete sales plans. "With asset sales, it is rarely a good idea to rush the process," says Pavel Molchanov, an analyst at Raymond James. "A lower, more deliberate process can allow the seller to maximize value for the asset."

Conoco spokesman John Roper said the company doesn't "discuss potential acquisitions and dispositions prior to their closings. While we expect additional announcements this year, we have none to discuss at present."

Conoco has made a few medium-sized deals this year, including an April sale of a 15% stake in the planned Australia Pacific LNG Project in Queensland for $1.5 billion and the sales of its Seaway Products Pipeline in South Texas for an undisclosded price. But the company needs to make a couple of large-scale assets sale announcements to let the market know that it isn't behind schedule, Gheit said.

Conoco could shed assets in Australia and Kazakhstan, say UBS analysts who in June met with ConocoPhillips Chief Financial Officer Jeff Sheets. Those could include new stakes in Conoco's Australian liquefied natural gas venture with Origin Energy Ltd. (ORG.AU), and its 8.4% interest in the Kashagan oilfield in Kazakhstan, UBS said. Conoco's partner in the field, Exxon Mobil, received a $5 billion bid for its identical stake in Kashagan, according to the Wall Street Journal.

Alan Hirshberg, Conoco's Senior Vice President of Planning and Strategy, said in a presentation at a May energy conference that the company is also looking at leaving countries where it has a small presence, and selling some marginal refining assets like the Wilhelmshaven refinery in Germany. Hirshberg said Conoco is also considering turning refineries into product terminals and striking joint venture agreements, exchanging refining capacity for oil and gas assets.

Conoco would most likely want to pull out of the East Coast market, where fuel imports into New York Harbor make price competition extremely difficult, UBS said. The company has two major refineries in the area, the 238,000 barrel-a-day Bayway refinery in Linden, New Jersey; and the 185,000 barrel-a-day refinery in Trainer, Penn. Valero Energy Corp. (VLO) sold two of its refineries in that region in 2010 to private equity firm PBF Energy. PBF declined to say whether it was interested in the Conoco refineries in the area.


Copyright (c) 2011 Dow Jones & Company, Inc.

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Asian stocks struggle to eke out gains as investors worry about surging oil prices

Asian stocks struggle to eke out gains as investors worry about surging oil prices

April 11 ,2011
By AssociatedPress

HONG KONG — Most Asian stock markets fell Monday as investors continued to worry about soaring oil prices and Japan’s struggle to recover from its worst-ever earthquake.

Japan’s Nikkei 225 stock average dipped 0.5 percent to 9,717.84 while South Korea’s Kospi edged down 0.3 percent to 2,121.49. Benchmarks in Taiwan, Singapore and India also fell while Hong Kong’s Hang Seng index was nearly flat at 24,397.44.

Australia’s S&P/ASX 200 was up 0.7 percent at 4,972.70 while mainland China’s Shanghai Composite Index rose 0.7 percent to 3,051.38.

Oil prices hovered at 30-month highs near $113 a barrel Monday in Asia as traders eyed a wobbly U.S. dollar and fresh Middle East tension.

“Oil prices are now at levels that have historically acted as a marked constraint on global output,” Daragh Maher, a foreign exchange strategist at Credit Agricole CIB, said in a research note.

Benchmark oil for May delivery slipped 11 cents to $112.68 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose $2.49, or 2.3 percent, to settle at $112.79 on Friday and set new 30-month highs almost every day last week.

Oil-related stocks were benefiting from the rising prices. Sinopec, Asia’s largest refiner by capacity, was up 2.4 percent to $4.10 Hong Kong dollars while PetroChina, the country’s biggest oil and gas producer, jumped 4 percent.

Companies with big fuel bills, like airlines, were suffering. Korean Air Lines Co. Ltd. dropped 3.7 percent, Qantas Airways Ltd. fell 2.7 percent, and Cathay Pacific Airways Ltd. was down 0.9 percent.

Oil moved higher as the dollar plunged against other major currencies. Oil is traded in dollars and tends to rise when the greenback falls and makes crude cheaper for investors holding foreign currency.

Some analysts were warning investors to avoid shares in Japanese automakers, whose production was severely curtailed by power outages and supply chain disruptions following the March 11 earthquake and tsunami. The twin disasters decimated the country’s northeastern coast, causing $310 billion in damage, killing up to 25,000 people and setting off a radiation leak at a nuclear power plant that was still not under control.

“We have turned bearish on the auto sector,” Citigroup Global Markets said in a report. The company said that the full extent of damage to the industry “is being underestimated by the market ... and we would avoid the sector as things stand.”

Shares of Toyota Motor Corp., the world’s No. 1 automaker, tumbled 2.5 percent. Nissan Motor Corp. drooped 2.2 percent, and Honda Motor Corp., slid 1.9 percent.

Japanese shares also fell after a report showed that machinery orders fell 2.4 percent in February, before the devastating earthquake and tsunami struck. Orders had risen 4.2 percent in January.

Chinese shares rose after the country reported a small trade surplus of $140 million in March, up from a deficit of $7.3 billion the month before.

“Chinese trade balance figures came out above analysts’ forecasts and provided some support to the Shanghai Composite, which is currently the best performer in the region,” said Chris Weston, a research analyst at IG Markets.

Oil prices are a concern in China, but there’s “still much liquidity, which means the stock market can still go higher,” said Linus Yip, chief strategist at First Shanghai Securities.

In New York on Friday, stocks were weighed down by oil prices as well as the threat of a government shutdown. But that risk was averted after the market closed when lawmakers agreed to a last-minute deal to cut about $38 billion in federal spending.

The Dow Jones industrial average lost 0.2 percent to close at 12,380.05. The Standard & Poor’s 500 index slipped 0.4 percent to 1,328.17. The Nasdaq composite lost 0.6 percent to 2,780.42.
In currencies, the dollar slipped to 84.79 yen from 84.89 yen late Friday. The euro stood at $1.4460, up from $1.4435 late Friday, its strongest level since January 2010.

BP investors poised to voice anger at executive bonuses

BP investors poised to voice anger at executive bonuses

10 April 2011

London. BP is preparing for an acrimonious showdown with investors at its annual meeting on Thursday as disgruntled shareholders object to boardroom bonuses and US Gulf Coast residents fly to London to confront top directors over last year's Deepwater Horizon oil disaster.

The Association of British Insurers (ABI) has issued an "amber top" alert to fellow institutional investors warning them to examine the issues surrounding bonuses of more than £100,000 to two of BP's top executives – finance director Byron Grote and downstream chief Iain Conn.

Critics view the payments as inappropriate following the environmentally catastrophic oil spill. BP argues that the executives met targets in their particular roles and that neither played any part in its offshore exploration division.

"Shareholders have to decide if they think these bonuses are appropriate after the year the company had," said an ABI spokesman.

Meanwhile, the corporate governance consultancy Pirc has urged investors to oppose BP's remuneration report over payouts to outgoing executives, including former chief executive Tony Hayward, who got £1m compensation for loss of office and has share awards yet to vest worth as much as £8m. Glass Lewis, a large US shareholder advisory firm, is urging a vote against BP's report and accounts.

BP is approaching the first anniversary of the blowout of its Macondo oil well off the Louisiana coast. The explosion last April of BP's Deepwater Horizon rig killed 11 people and caused a spill that polluted fishing areas and fouled hundreds of miles of beaches. Groups including Greenpeace and Christian Brothers Investment Services will make their voices heard. Some will attempt to present BP with a "black planet" award for ecological failures.

A delegation from the Gulf Coast will be at the meeting, to be held at the ExCel centre in Docklands. Among them will be Diane Wilson, a fourth-generation shrimper from Texas who was arrested last year for pouring an oil-like substance over herself in a congressional committee room while Hayward was giving evidence.

Wilson says oil is still washing up on the beaches around her home town of Seadrift, Texas – and that paperwork surrounding compensation for victims is impenetrable. She told the Observer she is planning "something more than just getting up" and asking a question: "What they're messing with is an entire way of life."

Others object to BP's £1.6bn "Sunrise" project to excavate oil from Canada's tar sands. But unlike last year, there will be no formal resolution protesting at BP's conduct.

US Investors Likely to Help New Regimes in Oil Countries

US Investors Likely to Help New Regimes in Oil Countries

Tuesday, April 05, 2011
The Washington Times

by  Tim Devaney

As political unrest and violence continue to flare across the Middle East, the U.S. capital is seeking its own oases in the desert.

Hotels, restaurants, and tourist-oriented transportation industries in countries that have thus far avoided major unrest -- the United Arab Emirates, Saudi Arabia, Morocco, and Oman -- are either thriving or expected to pick up new business in the near future. The oil industry in Persian Gulf countries such as Kuwait, UAE and Qatar are also likely to benefit as production is curtailed in other countries.

"Some of these markets and cities are doing incredibly well," said Jonathan Worsley, spokesman for the Arabian Hotel Investment Conference. "You're either in the thick of things, or you're doing well by not being in it."

But for major U.S. companies doing business in such long-established markets as Egypt and Tunisia, the future is far more uncertain. Old relationships have crumbled with old regimes, and much uncertainty hangs over economic policy as the new governments struggle to get organized.

Business groups say the turmoil is the Middle East and North Africa is nothing new for American companies operating there.

The region has long suffered from political and civil unrest that undercut their bottom lines. But veteran U.S. investors say they knew the risks they were taking when they went in. Most American investors plan to stay the course and help rebuild the economies under new regimes, according to Lionel Johnson, vice president of Middle East and North Africa affairs for the U.S. Chamber of Commerce.

"The U.S. companies that are there have been there for a long time, they're planning to be there in the future, and they're trying to do everything they can to help," Mr. Johnson said. "You're not seeing disinvestment. You're not seeing companies shutting their doors and pulling out operations. They're continuing to be there."

There are few U.S. companies in Libya, said Mohsin Khan, a senior fellow at the District-based Peterson Institute for International Economics, lessening the impact on American business investment there. American businesses have faced more difficulties in Egypt, where longtime U.S. ally Hosni Mubarak was driven from power by a popular revolt less than two months ago.

Some had to close at the height of the unrest. Kraft Foods, which has operations across the Middle East, was forced to suspend operations in Egypt and Bahrain for several days, but has since reopened its facilities.

The new regime in Egypt and those in other countries throughout the region could turn a cold shoulder to foreign businesses that flourished under the previous rulers, Mr. Khan warned. That could mean price controls that would cut into profits. U.S. producers like Kellogg's and Coca-Cola are among those who could be at risk.

"If you're in that business, your prices could be controlled," Mr. Khan said. "The profits there will be reduced. That, to me, is a serious risk."

A more pressing concern for Mr. Khan is whether these countries will blame foreign businesses for their struggles. Western analysts say Mr. Mubarak made a major move to overhaul the country's lagging economy in 2004, appointing a slate of reform-minded ministers to key economic, tax, labor and trade posts.

More insular, protectionist regimes could turn to tariffs and other barriers to trade as a way to protect local producers.

In recent years, economies across the Middle East were taking steps in the right direction, Mr. Khan added, but they could spiral backward.

Egypt, for example, once ranked near the bottom of the World Bank's list of 183 nations with business-friendly climates. But it had surged to No. 94 in the 2011 survey, before the fall of the Mubarak government.

"These economies were really opening up to the world," he said. "But I think there's going to be a pushback now. My hope is that they won't reverse directions, but that they simply won't push further ahead."

The uncertainty doesn't sit well with businesses in these countries. Tunisian officials reported last month that foreign investments in the country fell by 17.9 percent in January 2011 compared with January 2010, with major revenue declines in tourism and petroleum.

For those with a port in the storm, the picture is much brighter.

Hotels occupancy in Dubai, the largest city of UAE, and Riyadh, Saudi Arabia, has stayed strong at 82 percent and 70 percent, respectively, slight increases from a year ago, as displaced travelers flood there. Occupancy rates in Abu Dhabi are up to 67 percent from only 43 percent a year ago. In Muscat, the capital of Oman, they are up to 68 percent, a 12 point increase.

But these jumps in tourism come at the expense of other Middle Eastern spots that are crippled with unrest. Hotel occupancy for Cairo in Egypt is down to 40 percent from 67 percent a year ago, and Beirut in Lebanon also is down to 40 percent from 62 percent.

The troubling outlook has caused some to leave the area for a short time. But experts expect them to return.

"We find that hotels bounce back pretty quickly," Mr. Worsley said. "It's a long-term investment. I'm sure they're going to be back in there as soon as things settle down."