2024-04-29 07:42

CAPE TOWN, April 29 (Reuters) - Namibia's national oil company (NAMCOR) has signed a development deal with Chevron (CVX.N) New Tab, opens new tab that will see the U.S. oil major take an 80% operating working interest in an offshore block in the Walvis Basin, NAMCOR said on Monday. Oil companies are flocking to Namibia, excited by the southern African country's plans to open up a major new frontier basin, with recent offshore finds ranking among the largest this century. The farm-out agreement with Chevron Namibia Exploration Limited (CNEL) will see the National Petroleum Corporation of Namibia (NAMCOR) and local company Custos Energy each retain a 10% interest in petroleum exploration license 82. "Chevron looks forward to working with our partners to continue exploration activities and support Namibia’s energy sector," a spokesperson said. In addition to this acquisition, Chevron Namibia Exploration Ltd is the operator of the PEL 90, an offshore deepwater block located in the prolific Orange Basin where Galp (GALP.LS) New Tab, opens new tab also made a large discovery earlier this month. The Chevron spokesperson confirmed it planned to drill an exploration well in the block in the fourth quarter of this year. NAMCOR's interim managing director, Ebson Uanguta, welcomed the deal. "Our partnership with CNEL and Custos Energy represents a shared vision for the future of Namibia's energy landscape," Uanguta said in a statement. Namibia, which has yet to produce any oil or gas, has become an exploration hotspot after offshore discoveries by TotalEnergies (TTEF.PA) New Tab, opens new tab and Shell (SHEL.L) New Tab, opens new tab, and is planning for its first output by 2030. Sign up here. https://www.reuters.com/business/energy/namibias-namcor-signs-deal-with-chevron-develop-offshore-block-2024-04-29/

2024-04-29 06:37

NAIROBI, April 29 (Reuters) - At least 20 people have been killed in floods in central Kenya's Mai Mahiu area, Citizen Television reported on Monday, citing police. Police told the television channel that the number of deaths could rise because of a dam that had burst. Earlier on Monday, the Kenya Red Cross said it had taken several people to a health facility in Mai Mahiu due to flash flooding. The latest deaths bring the toll from heavy rains and flooding since last month to around 100. Government figures had showed 76 people had been killed and more than 131,000 displaced as of Saturday. Dozens more have been killed and hundreds of thousands displaced by intense downpours in other East African countries, including Tanzania and Burundi. Kenya's education ministry on Monday postponed the start of a new school term by one week. "The devastating effects of the rains in some of the schools is so severe that it will be imprudent to risk the lives of learners and staff before watertight measures are put in place to ensure adequate safety of all affected school communities," the education ministry said in a statement. The floods have destroyed roads and bridges across Kenya. A road underpass at the international airport in the capital Nairobi was flooded, but flights were running as usual, the Kenya Airports Authority said on Sunday. Hydroelectric dams were filled to capacity, which could lead to massive downstream overflow, a government spokesperson said. East Africa was hit by record floods during the last rainy season in late 2023. Scientists say climate change is causing more intense and frequent extreme weather events. Sign up here. https://www.reuters.com/world/africa/kenya-postpones-start-school-term-due-heavy-floods-2024-04-29/

2024-04-29 05:54

NEW YORK, April 29 (Reuters) - U.S. stocks gained ground on Monday and the yen surged amid suspected intervention as investors embarked on what promises to be an action-packed week. All three major U.S. stock indexes ended green, extending Friday's rally at the onset of a week filled with high profile earnings, crucial economic data and the U.S. Federal Reserve's monetary policy meeting. Meanwhile, the yen jumped after touching 34-year low, with traders citing heavy yen-buying intervention by Japanese banks. "It's a playbook that they’ve used before - nobody is commenting despite all the confirmations that it occurred," said Ross Mayfield, investment strategy analyst at Baird in Louisville, Kentucky. "It's a holiday (in Japan) as well, so it's a light volume day which points to some obvious conclusions even if its not official." This week's data releases include European inflation and U.S. labor market indicators, while the Fed is due to convene on Tuesday for its two-day meeting at which it is expected to keep its key interest rate unchanged, but strike a hawkish tone. "Inflation is not exactly where they want it to be, but it has come down to the point where if the labor market shudders even a little bit the Fed will pivot back to dovish talk pretty quickly," Mayfield added. "The labor market is the car we'll drive for the rest of the year." Earnings season shifts into overdrive this week with high profile results expected from Amazon.com (AMZN.O) New Tab, opens new tab, Apple Inc (AAPL.O) New Tab, opens new tab and others. The Dow Jones Industrial Average (.DJI) New Tab, opens new tab rose 147.4 points, or 0.39%, to 38,387.06, the S&P 500 (.SPX) New Tab, opens new tab gained 16.19 points, or 0.32%, to 5,116.15 and the Nasdaq Composite (.IXIC) New Tab, opens new tab added 55.18 points, or 0.35%, to 15,983.08. European shares eked out a nominal gain, backing down from a two-week high after Germany reported higher-than-expected inflation. Investors now eye the Fed's rate decision on Wednesday. The pan-European STOXX 600 index (.STOXX) New Tab, opens new tab rose 0.07% and MSCI's gauge of stocks across the globe (.MIWD00000PUS) New Tab, opens new tab gained 0.46%. Emerging market stocks rose 1.00%. MSCI's broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) New Tab, opens new tab closed 0.98% higher, while Japan's Nikkei (.N225) New Tab, opens new tab rose 0.81%. Japan's yen jumped as much as 5 yen against the dollar igniting suspicions that Tokyo intervened in the currency market for the first time in 18 months. Japan's top currency diplomat, Masato Kanda, declined to comment when asked if authorities had intervened, though traders said they had. The dollar was last lower against a basket of world currencies. The dollar index (.DXY) New Tab, opens new tab fell 0.3%, with the euro up 0.25% to $1.0719. The yen strengthened 1.49% versus the greenback at 156.04 per dollar, while sterling was last trading at $1.2562, up 0.58% on the day. U.S. Treasury yields pulled back from last week's highs ahead of a Fed meeting and crucial economic data expected later in the week. Benchmark 10-year notes last rose 13/32 in price to yield 4.6156%, from 4.669% late on Friday. The 30-year bond last rose 22/32 in price to yield 4.7357%, from 4.782% late on Friday. Crude prices slid as Israel-Hamas peace talks lowered the geopolitical temperature and tempered fears of a widening regional conflict. U.S. crude dropped 1.45% to settle at $82.63 per barrel, while Brent settled at $88.40, down 1.23% on the day. Gold prices edged lower as investors await crucial data and potential clues regarding the Fed's rate cut path. Spot gold dropped 0.1% to $2,335.71 an ounce. Sign up here. https://www.reuters.com/markets/global-markets-wrapup-1-2024-04-29/

2024-04-29 05:04

HOUSTON, April 29 (Reuters) - Financial details of Shell's (SHEL.L) New Tab, opens new tab vast oil and gas trading business are some of the company's closest-held secrets. Documents in a lawsuit filed by a former employee, however, revealed its U.S. crude trading regularly earns around $1 billion every year. Testimony by a former head of Shell's U.S. crude trading division filed in a Texas state court has offered a rare look at the huge profits of its trading operations and the multi-million dollar bonuses bestowed on traders. John Dimech, who was a manager in Shell's crude oil trading group in Houston for 11 years, said in a deposition last year that the crude trading unit typically made between $950 million to $1 billion a year. That is between 13% and 15% of Shell's overall U.S. pre-tax profits in recent years, according to calculations based on company filings. Shell's 2022 tax contribution report detailed a pre-tax profit of just over $7 billion total in the U.S. that year, while its 2021 pretax profit stood at about $6.36 billion. A Shell spokesperson declined to comment. The British oil major does not disclose the financial performance of its oil and gas trading desk, the world's largest, although the lack of information worries some investors. The business can generate bumper profits, but can be volatile and even post losses. Traders make money by buying and selling oil and gas using gaps in supply and demand around the world to lock in profits. Their pay often includes promises of large bonuses based on their performance, that can be more than CEO Wael Sawan's annual bonus, which was 2.7 million pounds ($3.4 million) last year, according to the latest annual report. In the Houston court filing, Shell denied a breach of contract claim by former trading manager Eva-Maria Frohn, who sought $15 million, including $6 million for 2021's bonus. She received a more than $5 million bonus in 2020 for her work the previous year. Frohn claimed that a job transfer she was offered would not be as lucrative as the job she held, making her redundant, while Shell maintained that her job rejection amounted to a resignation. A jury last Tuesday rendered a verdict favorable to Shell, nullifying Frohn's entire claim against Shell, according New Tab, opens new tab to the law firm that represented the company. Frohn's attorney did not reply to a request for comment. ($1 = 0.8005 pounds) Sign up here. https://www.reuters.com/legal/shell-earns-1-billion-year-us-crude-trading-court-filing-shows-2024-04-29/

2024-04-29 04:57

LAUNCESTON, Australia, April 29 (Reuters) - BHP Group's proposed takeover of rival miner Anglo American is one of those rare instances where a mega-merger actually makes strong business sense, but it will be difficult to pull off to the satisfaction of all parties. BHP (BHP.AX) New Tab, opens new tab, the world's largest mining company, offered $39 billion last week to buy Anglo (AAL.L) New Tab, opens new tab, a move the London-listed miner that grew out of South Africa rejected as "significantly" undervalued. The expectation now is that BHP may boost its offer, or other buyers for Anglo, or parts of its diversified portfolio, may emerge. Much of the media attention has focused on Anglo's copper assets as the lure for BHP, with a combined company becoming the world's largest producer of the industrial metal with a share of around 10%. In effect, BHP's bid is largely seen as a massive vote of confidence in the future of copper, which is essential to the energy transition given its properties as a conductor and its resistance to corrosion. The bid may also be a tacit admission on BHP's part that buying copper assets is far easier than trying to find them and develop new mines. Anglo has interests in three copper mines in Chile and its production in the 2023 financial year was 507,000 metric tons, which resulted in underlying earnings before interest, taxes, depreciation and amortisation (EBITDA) of $1.452 billion. The London-listed miner also has a 60% share in the Quellaveco mine in Peru, which gave it production of 319,000 tons and EBITDA of $1.781 billion. This gave Anglo total copper output of 826,000 tons and EBITDA of $3.233 billion, or 32% of the group's total for 2023. BHP's copper business is more diversified, with operations in Chile, Peru, Australia and the United States, and in the 2023 financial year production was 1.717 million tons for an underlying EBITDA of $6.65 billion. For the sake of argument, assume Anglo's copper earnings can be maintained and the copper price remains stable, it would take about six years for the earnings to pay off half of BHP's current offer price for Anglo. Of course, it's likely that there would be some cost synergies, and it's also probably the case that copper prices rally, especially if the energy transition starts to accelerate. That would make Anglo's copper assets more valuable to BHP as the return would be over a shorter time period. Of course, this assumes that BHP's view of Anglo's assets is that copper is effectively half of the worth of the total company, even though its only 14.5% of underlying EBITDA. The question for investors looking at BHP's proposed takeover of Anglo is how much are Anglo's non-copper assets worth, can they be disposed of effectively, or integrated into the wider group. COAL, IRON ORE The asset that fits best with BHP's existing portfolio is Anglo's metallurgical coal mines in Australia's Queensland state. BHP, through its alliance with Japan's Mitsubishi, is the world's largest exporter of the coal used primarily to make steel, while Anglo ranks third. Combining their assets would create a dominant metallurgical coal player, so much so that the deal is likely to attract scrutiny from regulators, especially in countries like Japan, which source the vast bulk of their coal from Australia. The current BHP proposal foresees Anglo's South African iron ore assets, held through Kumba Iron Ore (KIOJ.J) New Tab, opens new tab, and the platinum mines of Anglo American Platinum (AMSJ.J) New Tab, opens new tab, being divested and distributed to shareholders. This may present problems for the South African authorities, but it's also a sad reflection of how international companies are no longer keen on assets in the country that was once renowned as a centre of mining excellence. Iron ore is BHP's biggest earner, and the high-grade material produced by Kumba would be useful in the portfolio, but South Africa's political risk and crumbling infrastructure make it unattractive. Anglo's Brazilian iron ore operations also offer high-grade ore, which BHP could integrate or seek to sell off. Platinum is a commodity that may struggle in the energy transition, given its use in catalytic converters for internal combustion engine vehicles. Anglo's other interests, such as diamonds through De Beers, and manganese through Samancor, could most probably be sold to existing partners: the Botswana government for De Beers and South 32 (S32.AX) New Tab, opens new tab for the manganese. Overall, the mechanics of the deal seem to make good sense for BHP. They can be made to make sense for Anglo's shareholders if the offer is raised high enough so that they can't say no. Winning over various regulators across several countries may be far more tricky, and compromises may be needed, and that could end up undermining the very logic of the deal in the first place. Disclosure: At the time of publication Clyde Russell owned shares in BHP Group as an investor in a fund. The opinions expressed here are those of the author, a columnist for Reuters. Sign up here. https://www.reuters.com/markets/deals/bhps-anglo-buyout-makes-business-sense-if-price-is-right-russell-2024-04-29/

2024-04-29 04:43

MANILA, April 29 (Reuters) - The Philippines has closed schools down and warned of overloading on its power grid, as authorities across Southeast Asia issued a series of health alerts for a crushing and deadly heat wave. The Philippines' country's education ministry cancelled in-person classes at public schools for two days on Sunday. "We already have reports of high blood pressure and dizziness, and fainting for pupils and teachers in the past days," Benjo Basas, chairperson of Teachers' Dignity Coalition, a group of educators, told DWPM radio station. Temperatures in the Philippines are forecast to reach 37 degree Celsius (98.6 degrees Fahrenheit) in the next three days, with many classrooms crowded and without air conditioning. The country's weather agency said the heat index - the actual temperature felt by the body to include relative humidity - is expected to remain at a record 45 degrees Celsius (113° Fahrenheit), in the range which it classes as "dangerous" as conditions can trigger heat stroke from prolonged exposure. The heat wave is also putting pressure on power supplies on the main island of Luzon, which accounts for three-quarters of economic output, with reserves thinning after 13 power plants had shut down earlier this month, the Philippines' grid operator said in a statement. In Thailand, temperatures are forecast to surpass 40 degrees in Bangkok and the country's central and northern regions with the meteorological agency advising people to avoid being outdoors for extended periods. Temperatures soared to 44.2 degrees Celsius in the northern city of Lampang on April 22, with the meteorological department saying on Monday it expects the extreme heat will continue this week. In the past month, 30 people have died from heat stroke, data from Thailand's health ministry showed. DEHDRATION, HEAT SHOCK People are seeking respite from the heat in air-conditioned shopping malls in Vietnam's business hub Ho Chi Minh City, state media reported, with the country's national weather agency warning of risks of forest fires, dehydration, and heat shock. Maximum temperatures measured in several parts of northern and central Vietnam ranged from 40.2 and 44.0 degree Celsius the agency said on Sunday, adding that temperatures won't subside until Wednesday. Vietnam's state electricity company has also urged consumers to refrain from overworking their air conditioning units, warning that electricity consumption has reached record highs in the recent days. Malaysia meteorological department issued hot weather warnings on Sunday for 16 areas that have recorded temperatures between 35 and 40 degrees (95 to 104 degrees Fahrenheit) for three consecutive days. A total of 45 cases of heat-related illnesses have been reported in the country as of April 13, the health ministry said, without specifying when it began tracking the cases. Two deaths due to heat stroke have been reported, the ministry said in a statement. In the neighbouring city state of Singapore, the meteorological service said the country's temperatures could soar higher in 2024 than last year, which was Singapore's fourth-warmest year since records began in 1929. Singapore's hottest day recorded was May 13 last year when the highest daily maximum temperature hit 37 degrees Celsius. Since last month some schools have relaxed rules on uniforms to allow students to wear more comfortable physical education attire amid the persistent heat. Meanwhile, warmer temperatures in Southeast Asia's most populated nation of Indonesia are driving a surge in cases of dengue fever, a mosquito-borne infection, with cases more than doubling to 35,000 from 15,000 a year earlier, the health ministry has said. The El Nino weather pattern has prolonged the dry season and hotter temperatures have accelerated the mosquito lifecycle, Indonesian health ministry spokesperson Siti Nadia Tarmizi told state news agency, Antara. Sign up here. https://www.reuters.com/world/asia-pacific/philippines-dangerous-heat-prompts-shift-online-classes-power-crunch-2024-04-29/