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we could have 1/2 that this summer !!
Kina alone may yield us 100 MBbls
yes 4-5 wells with the DP makes sense Aug/Nov
Ruby how many people read Platts News, how many have heard of Platts news..
Hardly the WSJ
Ruby
ps I did send it to DowJones News for consideration
OJ with the EEZ now around the corner, and sure to be additional deals with Addax and Sino there
- he may just want to see a hole or 2 poked in the EEZ
Latest Addax Slide June 25 from AGM
http://www.addaxpetroleum.com/_media/2009_AGM_Presentation.pdf
Deepwater PathFinder Expected in August
Acceleration of Drilling
1.4 Bilion Bbls
Sinopec Merger - Senior Addax management continuing
Krom in 2003 ERHC and Sao Tome resolved their disputes and signed the Revised Oil Treaty to give ERHC the Block percentages they have today.
They separated with DRSTP in the State Oil Company STPetro of which ERHC had a shared percentage [1998] then later a lowered percentage [2001] then Zero in [2003].
Sao Tome got to keep their oil revenues
and
ERHC got hefty block percentages in both zones and many with Signature Bonus free options
Interesting ....Sinopec "Among international oil companies eying exploration contracts in the archipelago’s EEZ are those already operating in Sao Tome and Nigeria’s Joint Development Zone (JDZ) like China’s Sinpoec"
and this ... from June 9th
"We are exploring possibilities for strategic alliances with our technical partners on future initiatives in the JDZ and elsewhere. "
Homeport is there a URL Link ??
Homeport or Anyone ... Where did this post come from ??
Link Please if available
Excellent Homeport - lets hope they dont mess with the Bull
or
they will get the Horns
Stock2Rise LOL
if we go by the JDZ timeframe it should only take 8 years
or 2017 we should have the first drill ship arrive
"Sedco 702 will drill on jdz block 2. Probable spud will be early August. It is a tight hole so no information will be forthcoming on this well. As an exploration well, everyone is on strict confidentiality agreements."
Kind Regards
XXXXXX XXXXXX
from my last update sent last week ....
sorry guys to protect the name but this is from someone close to the Sedco
Didnt Jim Ledbetter say the Chinese would be tight lipped - so no surprise
If the Chinese are looking to acquire more acreage in the region - i would be surprised if they say anything at all and while Nigeria wants to promote the region they want to keep the Chinese happy at the same time
our best hope for news/info is from the JDA / reporters and folks close to the rigs
its friggen almost JULY and we have NOT seen an official PR from any operator about BL 2, - very bothersome when we all here know the Sedco has been contracted and is coming
Krom that is NOT good
thanks for the cherry news
ERHC peeps did too as they PR'd it Twice .. opps
Read the fine print "AS EARLY AS JULY"
this saves them
Pops How long is this Delay ?
Krombacher are you hearing a Sedco Rig Delay ??
last I heard was early Aug. spud Date - even though everyone was reporting July drilling.
HOW can Sinopec Drill in July if the Addax deal has not closed? ...
has this date slipped too ?
PLEASE VERIFY IF YOU CAN
Rigmyster Chill Sinopec has the Sedco coming
Spud Date Early August
and unless the Chinese ever want to do business in Africa again they will play nice with SEO
Sinopec swoops to buy Addax
BARRY MORGAN and XU YIHE, London and Singapore
Chinese giant in $7.2bn takeover of player with assets in West Africa
Chinese energy giant Sinopec has agreed a $7.2 billion deal to buy Swiss-headquartered Addax Petroleum after months of industry speculation.
Listed in both London and Toronto, Addax this week announced it had entered into a ?”definitive agreement”with Sinopec International Petroleum E&P Corporation (SIPC) under which the Chinese giant has offered to acquire all outstanding equity of Addax through a negotiated takeover for C$52.80 per share.
Addax said its board was recommending the proposed deal.
SIPC, a wholly-owned subsidiary of Sinopec, has offered to pay what represents a 47% premium to the closing market price on the Toronto Stock Exchange on ?5 June 2009, the day before Addax's public announcement that it was in preliminary talks.
Although the agreementwas seen by many as likely to be a done deal, there were some suggestions that Sinopec's chief rival in the race for Addax, Korea National Oil Corporation (KNOC), might yet consider a counter bid.
Sources familiar with the matter said KNOC chief executive Kang Yong-won and vice president Seong-Hoon Kim left Seoul on Tuesday for Geneva, trying to renegotiate with Addax. However, while a Sinopec source said he doubted any KNOC counter offer would succeed, he acknowledged that anything can still happen before a transaction is completed. The Sinopec agreement provides for a termination or break-up fee of $300 million if the acquisition is not completed within“certain specified circumstances”. The deal is subject to approval by the government of China which must agree the deal by 24 August.
Lock-up agreements for Addax chief executive and president Jean-Claude Gandur and his senior officers and directors represent 38% of outstanding Addax shares.
RBC Capital Markets will act as financial advisor and Fasken Martineau DuMoulin will act as Addax's legal counsel with Osler, Hoskin&Harcourt acting as legal counsel to the board.
With assets in Nigeria, Cameroon and Gabon, Addax is one of the region's largest independent oil producers, having increased crude output to an average of 134,700 barrels per day in the first quarter of 2009 mainly offshore Nigeria.
It had 538 million barrels of proven and probable oil reserves as of the end of last year.
In West Africa, Addax and Sinopec are due to spud the first of several deep-water wildcats next month in the Gulf of Guinea in the Nigeria-Sao Tome Joint Development Zone.
Addax also has a significant position in Iraqi Kurdistan through its interest in the Taq Taq field, which has just started to export oil.
--------------------------------------------------------------------------------
Thursday, 25 June, 2009, 23:01 GMT | last updated: Thursday, 25 June, 2009, 23:01 GMT
can someone post the ADDAX Call Details for today
China's unquenchable thirst for oil
Shawn McCarthy and Eric Reguly
Ottawa, Rome — Globe and Mail Update, Thursday, Jun. 25, 2009 06:53AM EDT
A refinery in Singapore. Oil and gas fields in Central Asia. A pipeline in Russia. Ultradeep crude deposits off Brazil. Production wells in Libya.
And now Toronto-listed Addax Petroleum Corp., (AXC-T48.963.317.25%) with its oil fields in western Africa and Iraq's Kurdistan.
China's cash-rich, state-controlled oil companies and its state development bank are on a buying spree, taking advantage of low crude prices and shrunken credit markets to snap up global assets that will help feed the country's enormous appetite for energy.
The Chinese are the most aggressive deal makers in the international oil industry right now, either through straight acquisitions or through innovative loans to foreign oil companies with crude as the currency of repayment.
Sinopec, the country's largest petroleum refiner, Wednesday continued its drive to boost the production side of its business by agreeing to acquire Addax for $52.50 a share, valuing the company at more than $8-billion. Sinopec's offer for Addax represents a 47-per-cent premium to the share price on June 5, the day before Addax announced it was in discussions with a potential buyer.
But while Chinese firms scour the globe for resources – encouraged by a central government that sees energy security as a key priority – they've shown only lukewarm interest in the world's second largest reserve base, Alberta's oil sands.
“Over all, their strategy is mainly to diversify and cut down on having half of their oil come from the Middle East,” said Steven Lewis, a China expert at the James Baker Institute at Rice University in Houston. “They know their demand is rising very quickly and there are only a few places around the world that are still being explored.”
Mr. Lewis said the Chinese focus on Central Asia, Africa and Latin America is more an accident of geography than a geopolitical attempt to supplant the United States as the dominant global player. Those are the regions that happen to contain the most exciting, lowest-cost discoveries.
The Chinese investment is widely welcomed in the global oil market where spending has declined dramatically after prices slumped from the record $174 (U.S.) a barrel touched just a year ago. The drop in investment could spark shortages and another runup in prices when the global economy begins to recover.
But there is a nagging concern that China may hoard resources if supplies tighten or the conflict in the Middle East threatens production there, and that the booming Asian giant would meet its energy security needs at the expense of Western nations.
Sinopec's purchase of Addax Petroleum is one of the strongest signs yet that China's international resources grab is real and gaining momentum.
Even as Sinopec was concluding that agreement, another state-owned oil giant, China National Offshore Oil Corp. (CNOOC) was reportedly in negotiations to buy Texas-based Kosmos Energy. Kosmos, like Addax, is focused on exploration and development in West Africa, one of the last frontiers for oil discovery.
Still another Chinese oil giant, China National Petroleum Corp. (CNPC), is on the prowl too. In February it paid $449-million (Canadian) for Verenex Energy, a Calgary company whose core operations are in Libya. Late last year, Sinopec paid about $2-billion for another Calgary company, Tanganyika Oil, which has production-sharing agreements in Syria.
Addax controlling shareholder, founder and billionaire Jean-Claude Gandur, has long believed Chinese companies would come after the company to help quench the country's deep thirst for oil. He has said the Chinese are highly tolerant of political risk and know how to win the hearts and minds of leaders in poor countries. They often do so by investing fortunes in local infrastructure, from road to hospitals.
In Nigeria, for example, a $2-billion (U.S.) infrastructure and energy deal gave the Chinese a 45-per-cent stake in the offshore Akpo field. Deals of the same size or bigger have been negotiated in Sudan and Angola, with smaller ones in Algeria, Libya, Congo and Zimbabwe.
In a few cases, the Chinese negotiate “off-take” deals, sometimes called bilateral deals. In these arrangements, the buyer demands that the commodity – oil, natural gas, base minerals, iron ore – is kept off the public markets such as the London Metal Exchange. There are no intermediaries and no one else can buy the commodity.
But some of the biggest Chinese oil deals have been made by the China Development Bank, a cash-flush, state-owned fund that has agreed to help finance energy development in Brazil, Congo, Kazakhstan, Russia, and Venezuela – often to be repaid with oil, and often with development side deals for Chinese companies.
In February, the China Development Bank agreed to lend $25-billion to OAO Rosneft, Russia's biggest oil producer, and OAO Transneft, the oil pipeline operator, to expand production and export capacity. In exchange, the companies will provide the China Development Bank with 15 million metric tonnes of crude per year, or the equivalent of 300,000 barrels a day.
In Brazil, Petroleo Brasileiro SA (or Petrobras) signed a co-operation agreement with China Development Bank and Sinopec that includes a $10-billion loan, increasing Petrobras's exports to China, and partnerships between Petrobras and Chinese companies in Brazil's oil fields.
The Chinese state companies have pursued both their own corporate agendas and the broader state goal of securing scarce resources, said Erica Downs, a China specialist at the Brookings Institute in Washington, D.C., and former analyst with the Central Intelligence Agency.
“Both the government and the companies are seizing opportunity in crisis,” Ms. Downs said. “But I don't see what they have been doing in the wake of the economic crisis to secure energy supplies abroad as posing a direct threat to U.S. interests.”
She added, however, that the deepening Chinese involvement in energy-rich regions such as Central Asia, Iran and Africa do have geopolitical repercussions, which is reshaping power relationships across the world.
Chinese companies have been more comfortable doing business in the developing world, where political elites often prefer Chinese to Western oil giants, in contrast to the deep suspicions that often greet the Asian firms in the developed world.
With the current thaw in Sino-Canadian relations, many analyst are expecting the Chinese companies to take a closer look at the oil sands. While political tensions have been a barrier, the Asian firms also were reluctant to invest in Alberta projects because of high costs and lack of export opportunities to the West Coast.
Sinopec, which owns a half stake in the long-stalled Northern Lights oil sands project, has been the most active Canadian investor as it seeks to expand its upstream business.
Wenran Jiang, a University of Alberta professor with close ties to Chinese firms, said oil companies around the world are looking for investment from the Asian giants. But so far, he said, Canadian-based firms are more likely to sell offshore assets to the Chinese than their domestic holdings.
Costs in oil sands remain high compared with many regions in the world, and Chinese firms still see the political climate as risky, Mr. Jiang said.
“The Chinese have so many options of buying conventional oil assets around the world, they don't have to come to buy our oil sands assets,” he said. “There are so many opportunities around the world and many countries want to lure the dragon.”
Sinopec seeks capacity, reserves with Addax bid
China's Sinopec seeks crucial capacity, coveted reserves with $7.2B Addax bid
By Elaine Kurtenbach, AP Business Writer
On Thursday June 25, 2009, 6:46 am EDT
SHANGHAI (AP) -- Sinopec, with its $7.2 billion bid for Addax Petroleum, is seeking crucial production capacity and coveted reserves in West Africa and the Middle East to help balance its heavy reliance on crude oil processing.
News that Addax's board had approved the offer by Sinopec, formally known as China Petroleum & Chemical Corp., helped push the Beijing-based company's shares up more than 2 percent Thursday, though they later fell back to close just 0.4 percent higher at 10.56 yuan.
The deal would be the largest ever overseas takeover by a Chinese company, although is only half the size of last year's acquisition by Aluminum Corp. of China, with Alcoa Corp., of a 12 percent stake in global miner Rio Tinto PLC. That deal was worth $14.3 billion.
The proposed acquisition must still be approved by regulators. But a takeover would help cushion Sinopec -- China's largest refiner by capacity -- against spikes in global crude oil prices that have caused it billions in losses in recent years due to caps on domestic fuel prices.
China is aggressively pursuing major acquisitions of resources, often running into heavy resistance in the host countries of its takeover targets.
Four years ago, China National Offshore Oil Company Ltd. withdrew an $18.5 billion bid for the Unocal Oil Company because of a tremendous backlash in Washington.
This month, the Anglo-Australian miner Rio Tinto dropped plans for a $19.5 billion investment from Aluminum Corp. of China, or Chinalco, amid a political firestorm in Australia over resource acquisitions by Chinese companies.
The biggest takeover before Sinopec's bid for Addax was offshore oil-services provider China Oilfield Services' acquisition last year of Norway's Awilco Offshore, in a deal valued at $2.5 billion,
State-owned Sinopec has its own imperatives for seeking overseas assets, given its heavy reliance on refining. Its net profit fell 47 percent in 2008 as government caps barred it from passing on costs of surging crude oil prices.
The company has seen a gradual improvement thanks to hikes in domestic fuel prices and the decline in international crude oil prices from their peak of about $150 per barrel in July.
Though it has forecast that first-half earnings will rise by more than 50 percent from a year earlier, its heavy exposure to refining remains risky.
"It's still not exactly a money-making enterprise for Sinopec, the domestic market," said Simon Wardell, an oil analyst with IHS Global Insight in London.
"Last year it was crazy. They were losing on every single barrel, every gallon they processed," he said.
Sinopec said it views the acquisition of Addax, which produced 134,700 barrels of crude oil a day in the first quarter of this year, as a "tranformational acquisition."
"We trust that this acquisition suits Sinopec's strategic goals, that it will strengthen Sinopec's presence in west Africa and Iraq and is a major step in its globalization," it said in a statement posted on the company's Web site.
Addax's oil and gas exploration and production is based mainly in west Africa and the Middle East, including joint operation of the Taq Taq field in Iraq's self-ruled Kurdish region with Turkey's Genel Enerji.
Such deals may be the best that relative newcomers to the global oil scene like Sinopec can expect when trailing majors like Exxon Mobile Corp. and Royal Dutch Shell that have a long history of exploration and development in major producing regions, analysts said.
"Good reserves in stable places have been locked up by the big multinationals," said Nick Lardy, an expert on China's economy at the Peterson Institute, a Washington think tank. "If you're a new player and you have a substantial appetite for access to oil on some long-term basis, then you are more or less forced to go into high risk places where the majors are not willing to tread."
There is no guarantee that the deal will go through.
Addax, which is listed on exchanges in London and Toronto, said it retains the right to consider any proposals superior to Sinopec's $46.17 per share offer.
But the price is a 47 percent premium to the closing market price for Addax on June 5, the day prior to its public announcement of sales talks, and Sinopec promised to keep Addax's top management intact, Addax said.
"We are pleased that Sinopec has recognized the highly attractive asset portfolio and exceptional team that we have assembled at Addax Petroleum," CEO Jean Claude Gandur said in a statement.
Shares of Addax Petroleum Corp. rose 7.25 percent to $48.96 Canadian ($42.44) Wednesday on the Toronto stock exchange.
Associated Press Writer Rob Gillies in Toronto contributed to this report.
Sinopec: China Oil's Blind Spot
HEARD ON THE STREET: China Oil's Blind Spot
Last Update: 6/25/2009 6:41:48 AM
By Andrew Peaple and David Winning
A DOW JONES COLUMN
Competing with Chinese oil companies for coveted energy assets, other Asian firms
are finding themselves outbid at every turn.
But they're having success venturing where China won't: the U.S.
Sinopec's $7.2 billion acquisition of Addax, has a familiar ring to it. The hefty
offer made Korea National Oil Corp. the latest loser to deep-pocketed Chinese
buyers. Also on that list is India's Oil & Natural Gas Corp.
The Chinese oil companies are certainly spending more. Including the Addax deal,
they've bought $43.7 billion of overseas assets since 2005. India's oil
companies, by comparison, have spent $8.7 billion, the Japanese $7.1 billion, and
South Korean firms $3.9 billion, according to Dealogic.
Still, there's one area where companies like KNOC have an edge. Chinese companies
have stayed away from U.S. assets ever since Cnooc's attempt to buy Unocal in
2005 became a political punching bag.
Meanwhile, with Korea-U.S. relations on a much easier footing, KNOC and others
are hunting for acquisition prospects stateside to achieve its target of
producing 300,000 barrels of oil per day by 2012.
Indeed, KNOC's two largest overseas acquisitions were in the U.S. This year it
paid $900 million for Offshore International Group, and $1 billion last year for
an oil field in the Gulf of Mexico. Five of the 10 largest deals done by Japanese
oil companies in the last four years have been in the U.S.
Without China in the game there, they certainly stand more of a chance.
(Andrew Peaple, is a Heard on the Street columnist. Currently based in Beijing he
can be also covered the U.K. economy and financial services, and is a
U.K.-qualified chartered accountant. He can be reached on +86-10-6588-5848, or by
email on andrew.peaple@dowjones.com)
TALK BACK: We invite readers to send us comments on this or other financial news
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(END) Dow Jones Newswires
June 25, 2009 06:41 ET (10:41 GMT)
Chinese firm to start crude exploration in JDZ
June 25, 2009 12:25AMT
http://www.234next.com/csp/cms/sites/Next/Money/Business/5430602-147/story.csp
By Clara Nwachukwu with Agency reports
China Petrochemical Corporation (SINOPEC) will drill its first exploration well in the Nigeria-Sao Tome and Principe Joint Development Zone (JDZ) in July.
The Chinese firm will start the oil exploration after some delay caused by the shortage of deepwater rigs, competent industry watchers told the News Agency of Nigeria (NAN) in Abuja on Wednesday.
Nigeria and the two archipelago islands of Sao Tome and Principe have a treaty to jointly manage the resources of their common maritime boundary in the ratio of 60 percent to 40 percent respectively.
Under the joint development agreement, both countries would ensure the orderly exploitation of the hydrocarbon and non-hydrocarbon resources in the JDZ.
Some officials familiar with SINOPEC's activities said the exploration was in line with efforts to speed up exploration in oil Block 2 in the JDZ, as the Chinese firm seeks to take over Addax Petroleum Ltd., one of its partners in the JDZ.
JDZ oil blocks
The 692 sq. km. Block 2 is linked to many partners including SINOPEC, which has a majority stake of 28.67%, ERHC (22%), Addax (14.33%), ONGC Videsh (13.5%), Equator (9%), MoMo Deepwater, JDZ Limited and Foby Engineering (each with 5%), and A & Hartman (with 2.5%).
Apart from having a 14.33 percent working interest in Block 2, Addax Petroleum is also the operator of Block 4 with a 45.5 percent interest as well as 40 percent and 15 percent interests in Blocks 1 and 3 respectively, according to the company's 2008 Annual Report.
"The Transocean SEDCO-702 deepwater rig is due to arrive at Block 2 around July 1 and drilling will start immediately afterwards," NAN quoted an official with the JDZ.
"SINOPEC secured the production and sharing contract on the block in 2006, but it has not been able to start drilling due to a shortage of deepwater rigs," a SINOPEC official and the JDZ official said.
The two officials, who preferred anonymity, declined to speculate on the SINOPEC-operated block's potential reserves, but industry reports point to a pre-drill resource estimate of about 275 million barrels.
There have been varied reports on the Addax-SINOPEC deal, but nothing has been concluded.
SINOPEC offer
Initial reports on the buyout had earlier quoted the Chinese firm denying making an offer of $8bn for Addax' assets in Nigeria and the Middle East.
But Bloomberg News reported on Wednesday that China Petrochemical Corp. has agreed to buy Addax Petroleum Corp. for C$8.3 billion ($7.3 billion) in the nation's biggest overseas takeover, gaining oil reserves in Iraq's Kurdistan and West Africa.
The report quoting an Addax statement on Wednesday also said that SINOPEC, China's second-largest oil company, will pay C$52.80 a share in cash, which is 47 percent more than Addax's closing market price in Toronto on June 5, the day before the company said it was in takeover talks.
It further said that parts of the deal would see the SINOPEC Group getting 42.5 million barrels of proved and probable reserves in the Kurdish region of Iraq, where the start of oil exports earlier this month sparked a wave of takeover interest.
China has spent as much as $5.4 billion since December on oil assets in Singapore, Syria and Kazakhstan after the price of crude fell from a record high and equity markets tumbled.
"The offer price is fair given prevailing oil prices and project risks," Gordon Kwan, head of Regional Energy Research at Mirae Asset Securities Ltd. Hong Kong, said by email. The transaction would be "China's single largest oil acquisition" by value, he said.
The deal surpasses China National Petroleum Corporation's $4.18 billion takeover of PetroKazakhstan Inc.. in 2005 and comes three weeks after Rio Tinto Group scrapped a $19.5 billion proposed investment from Aluminum Corporation of China.
The takeover "fits well with the nation's global energy strategy as the country pushes for diversification of its oil supplies, and increased access to oil in the Middle East and Africa will no doubt boost its energy security," said Jiang Xinmin, an energy researcher at the National Development and Reform Commission, China's top economic planner.
NAN reports that SINOPEC's executives might have travelled to London last week to meet with Addax Petroleum to discuss the takeover bid.
SINOPEC said the acquisition of Addax is a "transformational transaction," as it would help it to "achieve its strategic objective to build a stronger presence and operations in West Africa and Iraq, accelerating its international growth strategy as well as optimising its offshore oil and gas asset portfolio," the unit said in a statement in state-run China Daily on Wednesday
China Strikes Expensive Oil
<<Sinopec is paying about $16 per barrel of proven and probable reserves>>
Last Update: 6/24/2009 2:22:30 PM
By Liam Denning
A DOW JONES COLUMN
A maxim of the high-risk energy business is "you don't drill for oil in
Switzerland." But you can buy oil companies based there.
Addax Petroleum, which has an office in Geneva but reserves spread between
Nigeria, Gabon and Iraq, is selling itself to China Petrochemical Corp., or
Sinopec, for $8.8 billion, including net debt.
Sinopec is paying about $16 per barrel of proven and probable reserves. The
average for African and Middle Eastern deals in 2008 - a year that saw
triple-digit crude prices - was under $5 per barrel, according to consultants IHS
Herold and Harrison Lovegrove & Co.
Throw in Addax's possible reserves and contingent natural gas reserves and the
multiple drops to just over $7 per barrel of oil equivalent. Your average buyer
would never factor in such rosy assumptions. But then Sinopec, 66% owned by the
Chinese government, is not your average buyer. Besides slaking Beijing's thirst
for oil, Sinopec must be hoping to gain cachet by landing a large foreign
transaction while other recent landmark attempts, such as Aluminum Corp. of
China's deal with miner Rio Tinto, have failed.
One potential wrinkle is Baghdad, which still has no official agreement with
Kurdish authorities on managing the region's oil. The Iraqi government might take
offense at Sinopec's move and block access to bigger projects elsewhere in the
country.
Then again, would cash-strapped Baghdad really confront a major oil consumer
ready to pay top dollar for reserves? Even if it did, Addax's Kurdish assets
represent just a fifth of its proven and probable reserves. For the sake of
expediency, Sinopec could potentially split them off to appease Baghdad and still
gain Africa's riches.
(Liam Denning joined The Wall Street Journal from the Financial Times, where he
wrote for the Lex column. Previously, he was an investment banker at Goldman
Sachs. He can be reached at 212-416-3618 or by email at liam.denning@wsj.com)
(TALK BACK: We invite readers to send us comments on this or other financial news
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name; we reserve the right not to publish reader comments.)
(END) Dow Jones Newswires
June 24, 2009 14:22 ET (18:22 GMT)
Dow Jones : Chinese Purchasing Power
Last Update: 6/24/2009 1:11:41 PM
By Kevin M. Nichols and Jamie Miyazaki
A DOW JONES NEWSWIRES COLUMN
NEW YORK/HONG KONG (Dow Jones)--The $7.2 billion all-cash acquisition of Addax
Petroleum Corp. (AXC.T) by China Petrochemical & Chemical Corp., or Sinopec,
restores M&A on the forefront of Chinese business.
Sinopec's purchase of Switzerland-based Addax marks China's largest oil and gas
deal in history, trouncing the previous record held by CNOOC Ltd.'s (CEO) $4.3
billion purchase of Awilco Offshore last year.
Overall mergers and acquisitions activity from China, however, is down 39% year
over year, according to Dealogic. But that could change given both the amount of
cash Chinese corporations currently hold and the value to be had in expansion.
Buying Addax fits with China's objective of securing strategic resources as well
as growing its domestic companies. PetroChina Co. (PTR) last month invested in
Singapore Petroleum Co. (S99.SG).
As a refiner, Sinopec is highly dependent on crude imports and vulnerable to any
long-term secular rise in oil prices. The Addax acquisition partially fixes this.
Sinopec is primarily interested in Addax's operations in Nigeria, Gabon and the
Kurdistan region of Iraq, which until recently was protected from foreign
ownership. Sinopec last year paid $2 billion for Canadian outfit Tanganyika Oil,
which has primary assets in northeastern Syria, a strategic fit with Addax's
Kurdistan assets.
Sinopec and Brazil's Petroleo Brasileiro (PBR), or Petrobras, have a cooperation
agreement in oil and gas exploration, refining, petrochemicals, and the supply of
goods and services that could come in handy in western Africa. The deal allows
Sinopec to tap into Petrobras' ultra-deepwater oil and gas operations experience
- Petrobras contracts 80% of the world's supply of deep-water rigs - to explore
regions that were previously off limits due to technical constraints.
Also, Sinopec Group has a subsidiary called Sinopec International Petroleum
Exploration and Production Corp. (SIPC) that undertakes overseas investments and
operations in the upstream oil and gas sector.
Sinopec is looking to build on its 2.8 billion barrels of proven reserves by
adding to its portfolio Addax's 536 million-plus barrels of proved and probable
reserves. Addax averaged production of 136.5 million barrels a day last year.
Addax's healthy balance sheet makes the transaction easy from Sinopec's
perceptive. Addax's net debt before earnings, interest, taxes, depreciation and
amortization is a mere 0.5x. That compares to 1.30x for competitor Canadian
Natural Resources (CNQ.T).
Addax's stock has outperformed its peers by an average of nearly 78% year to
date. Shares hit a 52-week low in December 2008, whereas most energy-related
companies hit theirs in March of this year and rallied form there.
The offer represents a 47% premium to Addax's share price when the company
announced it was in preliminary discussions regarding a transaction earlier in
the month, and a 15% premium to Tuesday's closing price.
The breakup fee is C$300 million and would have to be born by Sinopec. The deal
is also subject to approval from the Chinese government, the Baghdad Oil Ministry
and Canadian officials.
The deal opens the door to the possibility of further M&A activity in new regions
by Chinese companies. Previously, the Chinese have avoided the Middle East and
focused on acquiring oil and gas territories in Asia and South America.
Investment bankers are also keeping a close eye on Aluminum Corp. of China Ltd.
(ACH), or Chinalco, to see how it wants to proceed following the collapse of its
proposed deal with Rio Tinto PLC (RTP). Chinalco has registered for Rio's rights
issue but has not determined if it will participate; it has until next week to
decide. Chinalco still has $1.96 billion in cash on the balance sheet for
possible deals.
Meanwhile, CNOOC and PetroChina have nearly $15 billion of cash between them. The
Sinopec deal will trigger some of that buying power.
(Kevin M. Nichols is a columnist for Dow Jones Newswires on the energy,
industrial and auto sectors. He has more than seven years experience as an
analyst and trader on Wall Street and was formerly an executive in the
proprietary trading unit at an investment bank. He can be reached at +1 (212)
416-2104 or by email: kevin.nichols@dowjones.com. Jamie Miyazaki is a columnist
for Dow Jones Newswires covering Asia. He can be reached at +852 2832 2320 or by
email: jamie.miyazaki@dowjones.com. Dow Jones Newswires is enhancing its news,
commentary and analysis for the investment banking community, and is providing it
on this service temporarily. To ensure continued access to the best of Dow Jones
news and opinion on companies, sectors and deals for bankers and research
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(END) Dow Jones Newswires
June 24, 2009 13:11 ET (17:11 GMT)
ADDAX Math Cash Deal at $53 CDN
Drilling is coming
Addax Loves Sinopec
Nigeria loves Sinopec
Sinopec Loves SEO
L&S
SFREED on Elephant Fields !!! "Sinopec knows the JDZ and it is an integral part of the deal for Addax. This is a ringing endorsement for the JDZ.
Sinopec has all the downside in carrying ERHC but no upside if oil is found. Sinopec not in business to carry others for no benefit.
Sinopec will have no political problems in Nigeria whatsoever. Offor will make things go even smoother.
Get ready to tender your shares."
http://finance.groups.yahoo.com/group/theelephantfields/
a Clear Victory for Addax CEO
front page Globe and Mail http://www.theglobeandmail.com/report-on-business/
Sinopec agrees to buy Addax for $8-billion Offer of $52.50 a share marks clear victory for Addax CEO Jean Claude Gandur 7:27 AM EDT 0 2
China's biggest oil products company, Sinopec, has agreed to buy Toronto-listed Addax Petroleum Corp. (AXC-T45.651.002.24%) for $52.50 a share, valuing the company at more than $8-billion.
The price was somewhat higher than expected. Earlier this week, the shares were trading at about $45 a share as investors took the view that the company was fully valued. The offer represents a 47 per cent premium to the closing price on June 5, the day before Addax announced it was in discussions with potential buyers.
The offer represents a clear victory for Jean Claude Gandur, the Addax founder and CEO who controls about 38 per cent of the company personally and through his holding company, Addax & Oryx Group. Mr. Gandur, a French-born Swiss citizen who lives in Geneva, told brokers and analysts not long ago that he would resist an offer pitched at less than $50 a share.
Addax signed a definitive agreement with a Sinopec subsidiary called Sinopec International Petroleum Exploration and Production Corp. Mr. Gandur and his holding company entered a lock-up agreement to tender their stake to Sinopec.
Addax warned that Sinopec's commitment to buy all the outstanding shares “is subject to the receipt of certain approvals from the Government of the People's Republic of China.” Sinopec is government-controlled. In 2008, it ranked 16th on Fortune magazine's Global 500 list, measured by revenue. The Addax acquisition is the largest foreign takeover by a Chinese company.
Addax did not identify the other bidders, though the high price suggests the competition was strong. Sinopec was thought to be competing with Korean National Oil Co. and possibley two Indian companies, state-controlled Oil and Natural Gas Corp. and Reliance Industries Ltd.
Addax produces about 140,000 barrels a day, most from on- and offshore fields in West Africa. It also has some production from the Taq Taq field in the Kurdistan region of Northern Iraq.
Mr. Gandur predicted more than a year ago that Addax would eventually find an Asian buyer, because Asian oil companies have a greater tolerance for operations in politically risky countries.
In London trading after the announcement was made, Addax shares jumped more than 15 per cent to £27.40.
RBC Capital Markets acted as Addax's financial adviser on the deal.
http://www.marketwatch.com
Sinopec to acquire Canada's Addax in $7.2 billion dealExplore related topics
CHINA Addax Petroleum Corporation Story Quotes Comment Alert Email Print ShareBy Simon Kennedy, MarketWatch
LONDON (MarketWatch) -- Canadian oil and gas group Addax Petroleum said Wednesday that it's agreed to a C$8.3 billion ($7.2 billion) all-cash takeover bid from a division of China's Sinopec.
Addax /quotes/comstock/11t!axc (CA:AXC 45.65, +1.00, +2.24%) said it's entered a definitive agreement under which Sinopec will offer C$52.80 per common share in cash. The deal has been unanimously backed by the Canadian group's board.
The offer represents a 47% premium to the closing price on June 5, before Addax announced it was talks over a possible deal.
Addax shares closed Tuesday at C$45.65.
Formal documentation for the deal is expected to arrive in early July and shareholders will have at least 35 days to accept the offer. It will require acceptance from investors holding at least two-thirds of the stock as well as regulatory approval, including from the Chinese government.
If Addax backs out of the deal, or if Sinopec doesn't receive the necessary approval in China, then a break fee of C$300 million may be payable.
CEO Jean Claude Gandur and Addax & Oryx Group, which founded Addax Petroleum in 1994, have agreed to tender their shares in the offer and other senior directors will enter similar agreements.
The total lock-up agreements on shares represent around 38% of the stock.
"The efforts and accomplishments that Addax Petroleum has achieved thus far will be built on through increased investment in the business and acceleration of development and exploration plans," said Gandur in a statement.
RBC Capital Markets is acting as financial advisor to Addax and Fasken Martineau DuMoulin LLP is acting as legal counsel.
Simon Kennedy is the City correspondent for MarketWatch in London
SEDCO-702 Rig due at JDZ BL 2 July 1
http://store.businessmonitor.com/article/267879/
Jun 23 2009
China Petroleum and Chemical Corporation (Sinopec) is preparing to drill its first exploration well in the in the Joint Development Zone (JDZ) offshore Nigeria and São Tomé and Príncipe (STP), according to a report in Dow Jones Newswires which cited industry sources.
Sinopec is set to spud the well in July after a lengthy delay caused by a shortage of deepwater rigs. The JDZ is shared by Nigeria and neighbouring São Tomé and contains 23 exploration blocks. It could potentially hold up to 14bn barrels (bbl) of oil. Nigeria and São Tomé have agreed to split revenues from the blocks on a 60/40 basis.
Sinopec Eyes Block 2 Drill
The Joint Development Zone (JDZ) offshore Nigeria and São Tomé and Príncipe (STP)
Sinopec secured a production sharing contract (PSC) on Block 2 in 2006, but has not been able to drill up to now owing to a shortage of deepwater rigs, according to a Sinopec official cited by the report. Block 2 covers an area of around 693.5sq km with water depths ranging from approximately 1,300 metres (m) to 1,900m.
According to the agreement signed with the Joint Development Authority (JDA), the body established in 2001 to oversee the JDZ, Block 2 has a minimum work programme of one exploration well or a minimum expenditure of US$28mn. Transocean's SEDCO-702 deepwater rig is due to arrive at Block 2 around July 1 with drilling set to start immediately, according to a JDA official. Sinopec operates Block 2 and holds a stake of 28.7% alongside ERHC Energy (22%), Addax Petroleum (14.3%), ONGC Videsh (OVL, 13.5%), Equator (9%), A & Hatman (2.5%), Amber Petroleum (5%) and Foby Engineering (5%).
In 2009, independent engineering firm Netherland, Sewell & Associates (NSAI) released a resources assessment for ERHC that examined JDZ blocks 2, 3 and 4. Block 2 is estimated to hold around 275mn bbl.
The start of drilling on Block 2 comes as Sinopec reportedly steps up its efforts to seal an US$8bn takeover of Addax. Sinopec executives reportedly travelled to London in mid-June to meet Addax Petroleum to discuss a potential takeover bid.
London- and Toronto-listed Addax Petroleum has a total of four stakes in blocks in the JDZ that will require significant investment, which may lend itself to development by a state-owned company with deep pockets. In addition to its 14.33% interest in the JDZ's Block 2, Addax has a 15% stake in Block 3 and is the operator of Block 4 with a 38.3% participation interest.
It acquired ExxonMobil's 40% interest in Block 1 in September 2007. Exploration in the JDZ had been slow, with only one well drilled since the 2001 agreement between Nigeria and São Tomé. This was in 2006 by US major Chevron. The well did not meet expectations although it did hit hydrocarbons.
Upstream Online .. Sinopec is set to shell out C$8.27 billion (US$7.24 billion) for Addax Petroleum after the Canadian-based outfit gave the nod to the Chinese giant's C$52.80 per share takeover offer.
I hope Sinopec now has room for desert
love it when a plan comes together
ADDAX / AXC.TO Up Up and Away ....
2:05pm ET
http://finance.yahoo.com/q?s=AXC.TO
Last $46.01
+$1.36
+3.05%
1,048,638 VOL
JCanada this may contribute to the pot....
Sinopec Plans To Issue ($2.93 billion) CNY20 Bln 3-Year Notes this Friday
Last Update: 6/22/2009 10:35:05 PM
SHANGHAI (Dow Jones)--China Petroleum & Chemical Corp. (SNP), or Sinopec, said
Tuesday it plans to issue CNY20 billion ($2.93 billion) three-year medium-term
notes on the interbank market Friday.
Sinopec, Asia's largest refiner by capacity, said in a statement it will use the
proceeds to supplement working capital and repay bank loans.
Industrial & Commercial Bank of China Ltd. and China Construction Bank Corp. are
the deal's main underwriters, it said.
-Wang Ming contributed to this story; Dow Jones Newswires; (86-21) 6120-1200;
ming.wang@dowjones.com
(END) Dow Jones Newswires
June 22, 2009 22:35 ET (02:35 GMT)
after MM ABLE on the ASK is .65 then .69
ABLE appears to be trying to shake the tree looking for support - the problem is there is not any stock for sale
Very Telling thx Rambus
Hmmm .. Sinopec Plans To Issue CNY20 Bln 3-Year Notes Friday
Sinopec Plans To Issue CNY20 Bln 3-Year Notes Friday
Last Update: 6/22/2009 10:35:05 PM
SHANGHAI (Dow Jones)--China Petroleum & Chemical Corp. (SNP), or Sinopec, said
Tuesday it plans to issue CNY20 billion ($2.93 billion) three-year medium-term
notes on the interbank market Friday.
Sinopec, Asia's largest refiner by capacity, said in a statement it will use the
proceeds to supplement working capital and repay bank loans.
Industrial & Commercial Bank of China Ltd. and China Construction Bank Corp. are
the deal's main underwriters, it said.
-Wang Ming contributed to this story; Dow Jones Newswires; (86-21) 6120-1200;
ming.wang@dowjones.com
(END) Dow Jones Newswires
June 22, 2009 22:35 ET (02:35 GMT)
it's 11,445 short NOT 11,445,000
http://www.otcbb.com/asp/OTCE_Short_Interest.asp
Type in ERHE - middle of the page
no sustained bidders - NOT manipulation