2024-06-20 06:58

LONDON, June 20 (Reuters) - Energean (ENOG.L) New Tab, opens new tab has agreed to sell its assets in Egypt, Italy and Croatia to private equity fund Carlyle (CG.O) New Tab, opens new tab for up to $945 million, the Mediterranean-focused oil and gas producer said on Thursday. The deal will include a cash payment of $504 million which will allow the London-listed company to pay a special dividend of $200 million as well as repay in full a $450 million corporate bond. Carlyle International Energy Partners, the fund's non-U.S. energy investment arm, said it will establish a new company which will seek further acquisitions in the Mediterranean and will be led by former BP (BP.L) New Tab, opens new tab CEO Tony Hayward. Energean CEO Mathios Rigas said the sale will allow the company to focus on its main gas producing facility offshore Israel and its exploration activity in Morocco. Energean will also look to expand to the wider Europe, Middle East and Africa region, particularly where there is long-term policy support for gas and displacement of coal, he told Reuters. "It's a great deal for us, we're selling assets at three times the price we bought them," Rigas said. Energean's board expects to redefine its dividend policy following the completion of the deal, which is expected by year-end. Energean produced 123,000 barrels of oil equivalent per day (boed) in 2023. For 2024 it expected production in Egypt to rise to 29,000-31,000 boed from around 25,000 boed. Energean acquired the assets in Egypt, Italy and Croatia through its acquisition of Edison's oil and gas portfolio in 2020. CIEP said the deal will create a company with 47,000 boed of production, including interests in Cassiopea, Italy’s largest gas field in terms of reserves, and Abu Qir, one of the largest gas producing hubs in Egypt. "This acquisition provides a strong platform to build a standalone regional champion in the Mediterranean, one of the fastest growing natural gas markets in the world," Hayward said in a statement. Sign up here. https://www.reuters.com/markets/deals/energean-sell-egypt-other-assets-carlyle-up-945-mln-2024-06-20/

2024-06-20 06:44

Middle East conflict remains in focus EIA reports draw on U.S. crude BoE keeps rates unchanged ahead of UK election June 20 (Reuters) - Oil futures climbed on Thursday after the U.S. Energy Information Administration (EIA) reported a draw on crude oil and data showing a cooling jobs market that stoked hopes the Federal Reserve could cut interest rates soon. Brent crude futures settled at $85.71 a barrel, up 64 cents or 0.75%. The session high of $85.89 was the highest since May 1. U.S. West Texas Intermediate (WTI) futures for July , which expire on Thursday, finished at $82.17 a barrel, up 60 cents, or 0.74%. "The market is definitely getting a bounce," said Phil Flynn, analyst with Price Futures Group. Crude inventories fell by 2.5 million barrels in the week ending June 14 to 457.1 million barrels, the EIA said, compared with analysts' expectations in a Reuters poll for a 2.2 million-barrel draw. Stocks at the Cushing, Oklahoma, delivery hub for U.S. crude futures (USOICC=ECI) New Tab, opens new tab rose by 307,000 barrels, the EIA said. There was no WTI settlement on Wednesday because of a U.S. public holiday, which kept trading largely subdued. The more active August contract was up 60 cents at $81.31. The number of Americans filing new claims for unemployment benefits fell last week. Labor market momentum has ebbed in tandem with the overall economy as the Fed has tightened policy to fight inflation. With that pressure subsiding, a rate cut this year remains on the table. Lower rates could support oil prices, which have been dragged this year by lackluster global demand. A U.S. rate cut would make borrowing cheaper in the world's largest economy, galvanizing the appetite for oil as production picks up. Oil prices are also likely to remain supported by a growing geopolitical risk premium driven by conflict in the Middle East, said ActivTrades analyst Ricardo Evangelista. Israeli forces pounded areas in the central Gaza Strip overnight, while tanks deepened their advance into Rafah in the south. However, expectations of an inventories build appear to be overshadowing fears of escalating geopolitical stress for now, said Priyanka Sachdeva, senior market analyst at Phillip Nova. A summer uptick in oil demand, refinery runs and ongoing weather risks added to extended production cuts by the OPEC+ producer group mean that "oil balances should tighten and inventories should begin to draw during the summer months", JPMorgan commodities analysts wrote. The Bank of England kept its main interest rate unchanged at a 16-year high of 5.25% ahead of Britain's national election on July 4. (This story has been corrected to change the crude inventory data to 2.5 million barrels, not 5.9 million and expectations to 2.2 million, not 1.9 million, in paragraph 5, and to say that the stocks rose by 307,000 barrels, not fell by 1.3 million barrels, in paragraph 6) Sign up here. https://www.reuters.com/business/energy/brent-rises-middle-east-war-while-wti-dips-ahead-inventories-report-2024-06-20/

2024-06-20 06:34

JAKARTA, June 20 (Reuters) - Indonesia's Awyu tribe of the Papua region has filed a case to the Supreme Court seeking to cancel permits for palm oil concessions on thousands of hectares of rainforest over which it has ancestral rights. The world's biggest producer and exporter of palm oil, Indonesia has pledged to clean the image of the multi-billion dollars industry which is often accused by environmentalists of causing widespread deforestation. Indonesia is home to the world's third-largest tropical rainforest and accounts for 60% the world's supplies of palm oil which is used in food products as well as a fuel. WHAT ARE INDONESIA'S RULES ON DEFORESTATION? In an effort to reduce its greenhouse gas emissions, Indonesia stopped issuing permits to clear forests and peatlands in 2011 for 8 years. In 2019, President Joko Widodo made the moratorium permanent in an aim to protect Indonesia's 66 million hectares (254,827 square miles) of forests and peatlands. The president also imposed a moratorium on permits for new palm oil plantations in 2018, intended to stop deforestation amid backlash from consumers worried about the environmental impact of palm estates replacing rain forests. The palm oil moratorium expired in 2021, but Jokowi pledged not to issue new permits for palm oil plantations. In the same year, the government ordered an evaluation of the existing permits, with an aim to revoke permission if concessions are found in areas with forest cover. Local conservation group Auriga Nusantara in 2022 estimated that around 2.4 million hectares of rain forests were part the total land which was allocated for developing palm oil estates. Now that Jokowi is leaving office soon, the group is worried that the next administration might not honour the moratorium as it was not drafted into law. "This case in Papua could spread to other areas," said Roni Saputra from the group. HOW DO RULES IMPACT THE CASE AGAINST COMPANIES IN PAPUA? Permits for the "Tanah Merah Project" concessions in Papua were issued between 2011 and 2013, prior to recent efforts to conserve pristine forests. But due to the 2021 evaluation, these permits were revoked in January 2022. Several companies behind the concessions brought this revocation to the court, launching a legal battle that has now reached the Supreme Court where the Awyu tribe is contesting for the revocation to be upheld. While the central government in Jakarta remains steadfast that these permits should be cancelled, the Papua provincial government in 2021 granted Indo Asiana Lestari (IAL) permission to cultivate land and build mills, a few months after the palm oil moratorium lapsed. Papua government representatives were not available to comment on the matter. Supreme Court judges are expected to decide on the cases jointly this month, a lawyer for the Woro clan of the Awyu tribe told Reuters. WHAT IS THE CURRENT RATE OF DEFORESTATION IN INDONESIA? Indonesia's deforestation rate has fallen between 2019 to 2022, according to the latest available data provided by environment ministry. In the 2021/2022 period, 119,400 hectares of forests were cleared, more than a fifth of the average size of deforested areas between 2013 and 2020. However, green groups said forest and peatland clearance to make way for plantations, including for palm oil, remained a practice despite a global outcry over environmental damage. Some 52,000 hectares of forests were converted into plantations between 2022 and 2023, according to data from Nusantara Atlas, an independent organisation tracking deforestation in Indonesia. The total size of palm plantation has also continued to expand despite the plantation permit moratorium. The total size of Indonesia's palm oil plantations reached 17.3 million hectares in the latest land mapping survey this year, up from 14.32 million hectares in 2018. Green groups said they fear the government's ambitious biofuel targets may continue to drive expansion in palm oil plantations. Palm oil producers group GAPKI said Indonesia may need to expand the plantation area as output stagnated while replanting progress remained slow, however such expansion should only be done in degraded areas without clearing forests, the group said. Sign up here. https://www.reuters.com/business/environment/how-indonesias-deforestation-persists-despite-moratorium-2024-06-20/

2024-06-20 06:31

LITTLETON, Colorado, June 20 (Reuters) - Natural gas-fired power generation in the United States has climbed nearly 6% through June 17 from the same period a year ago, as above-normal temperatures lifted use of power-hungry air conditioners. U.S. power generation from natural gas from Jan. 1 through June 17 was just over 30 million megawatt hours (MWh), according to data compiled by LSEG. That total compares to 28.4 million MWh during the same period in 2023, and is the highest gas output reading since at least 2021, LSEG data shows. Power generation from clean sources including nuclear plants, hydro dams, solar parks and wind farms climbed 7.6% from 2023 to a record 33.5 million MWh, and clean output is set to rise further during peak solar production periods. But natural gas looks set to remain the largest single fuel source in the U.S. power system, and will likely be deployed in even greater quantities over the coming months as demand for cooling systems rises during the hottest time of year. In turn, U.S. power sector emissions from gas use will likely also climb to new highs in 2024, potentially accelerating the climate warming trends that are fuelling increased higher gas demand in the first place. GAS UP, COAL DOWN Natural gas accounted for a 39.7% share of total U.S. power generation from Jan. 1 through June 17, LSEG data shows. That share is up from 39% during the same period last year, and marks gas' highest power share since at least 2021 for that period. Reduced use of coal in the U.S. power system accounts for some of the higher gas use. Coal's share of this year's power mix was 15.4% through June 17, down from 16% a year ago and a 23% share during the same period in 2021. Power firms are expected to make further cuts to coal use in generation going forward as part of ongoing emissions reduction efforts and a longer-term target to decarbonize the U.S. power system. However, higher overall power demand means that suppliers have been forced to keep increasing the overall volume of fossil fuels used in generation, even as supplies from clean power sources continue to climb. Total power generation this year is up 3.8% from the same period a year ago, as higher power use by air conditioners, data centers, vehicle chargers and businesses push up overall demand. To meet the higher load requirement, power firms have lifted the combined volume of power generated by natural gas and coal by the same degree, to 41.7 million MWh. CLEAN RECORDS While natural gas remains the primary U.S. power fuel, output of several clean energy sources has hit records so far this year. From Jan. 1 through June 17, wind power generation was an all-time high 9.6 million MWh, up 9% from the same period in 2023, while solar generation was up 38% to a record 3.607 million MWh. Output from nuclear reactors was up 3.4% to 14.98 million MWh - the highest in more than three years - while hydro generation climbed 1.4% to the highest since 2022. The overall share of clean power in the U.S. generation mix also climbed to a new record this year of 44.3% through June 17, compared to 42.7% a year ago. Even so, output from fossil fuels - which includes a diminishing volume of crude oil-fired generation as well as natural gas and coal - remains the backbone of the U.S. grid system. KEY SYSTEMS While gas-fired output has climbed by nearly 6% nationally, there are several key U.S. power systems where gas-fired output has jumped by larger margins. The Electric Reliability Council of Texas (ERCOT) system has boosted gas output by 10% from the Jan. 1 to June 17 period of 2023, LSEG data shows. Gas generation in the Southwest Power Pool (SPP), which produces power for all or parts of 14 states across the Midwest and West, has climbed by nearly 14%. Power producers in Florida have lifted gas generation by 10% through June 17, but are likely to increase gas-fired output higher still during July and August, which are the hottest months of the year in the state. The PJM Interconnection system, which provides power for consumers across Pennsylvania, New Jersey and Maryland, has upped natural gas output by 6% and coal-fired output by 5% so far this year. In power systems throughout the U.S. - including California which has the highest proportion of clean power among major states - gas-fired output is likely to climb over the coming months as temperatures peak and boost air conditioner use. Higher gas use in generation will in turn yield higher power sector emissions, which in peaked last summer peaked at around 98 million metric tons of carbon dioxide in July and August, according to energy think tank Ember. In 2024, gas emissions are already tracking ahead of last year's record pace, and loads could top 100 million tons a month for the first time if gas use continues to climb. Sign up here. https://www.reuters.com/business/energy/us-power-system-cranks-up-gas-output-cooling-season-kicks-off-maguire-2024-06-20/

2024-06-20 06:18

BENGALURU, June 20 (Reuters) - Indian metals-to-oil conglomerate Vedanta (VDAN.NS) New Tab, opens new tab will raise up to 10 billion rupees (nearly $120 million) by issuing non-convertible debentures through a private placement, the company said on Thursday. In the past two months, Vedanta's board has already approved raising up to $300 mln through debentures and a further up to $1 billion, although it is yet to decide on the structure and mode of that fundraise. The billionaire Anil Agarwal-led company is in the middle of splitting into six different units in a move aimed at shoring up the group's financial performance Its net debt rose 25% to 563.38 billion rupees as of March 31, while its full-year cash and cash equivalents fell to 28.12 billion rupees from 69.26 billion rupees a year earlier. The company aims to expand capacity for its steel and aluminium business and has proposed to set aside $1.90 billion as capital expenditure for fiscal 2025, higher than the $1.4 billion the year before. Vedanta's shares were up 5.5% in late morning trading. ($1 = 83.5070 Indian rupees) Sign up here. https://www.reuters.com/markets/commodities/indias-vedanta-raise-120-mln-via-debt-issue-2024-06-20/

2024-06-20 06:13

KYIV, June 20 (Reuters) - Russian drone and missile strikes damaged energy infrastructure across Ukraine on Thursday in the latest major attack on the country's civilian energy system, the Ukrainian energy ministry said. The energy ministry said the attack injured three workers at one energy facility and cut power for some consumers. Ukrainian energy firm DTEK said that one of its thermal power plants had also been seriously damaged. Kyiv says Russian drone and missile strikes on Ukraine's energy infrastructure this spring have knocked out half the country's power generating capacity and forced rolling blackouts. The Ukrainian air force said it shot down five out of nine missiles and all 27 drones launched by Russia over 10 Ukrainian regions during Thursday's attack. The military said Russia mostly targeted eastern Ukraine, specifically Dnipropetrovsk region. Dnipropetrovsk's governor said the air force shot down five drones and four missiles over his region. Three men were injured in the attack, which also damaged seven homes, he said. Serhiy Popko, the head of Kyiv's military administration, said Ukraine's air defence shot down all air weapons on their approach to the capital with no damage or injuries reported in the city. Air defences also downed four drones over the central region of Vinnytsia where debris damaged a critical infrastructure object, the regional governor said. Russia says energy infrastructure is a legitimate military target and denies targeting civilians or civilian infrastructure. Sign up here. https://www.reuters.com/world/europe/russian-air-attack-damages-ukraines-energy-infrastructure-2024-06-20/