Media Focus on Multinational Corporations[2022.02.21]






Lukoil increases stake in BPs Shah Deniz after closing Petronas deal

Russian oil and gas company Lukoil has completed the acquisition of Petronasinterest in the BP-operated Shah Deniz natural gas project, located in Azerbaijans sector of the Caspian Sea, effectively raising its stake in the project.

The initial agreement for the acquisition of 15.5 per cent interest in the Shah Deniz project was signed in October 2021 to enable Lukoil to increase its interest in the project from 10 per cent to 25.5 per cent after paying $2.25 billion.

However, Lukoil and Petronas signed in December 2021 amendments to the agreement concluded in October, reducing the share acquired by Lukoil from 15.5 per cent to 9.99 per cent with a proportional decrease in the transaction value from $2.25 billion to $1.45 billion.

Dragon Oil

UAE's Dragon Oil Strikes Oil in Gulf of Suez

United Arab Emirates-based Dragon Oil has made its first oil discovery in the Gulf of Suez, the Egyptian petroleum ministry said in a statement on Tuesday.

The discovery is one of the largest in the area in the past 20 years, it said, adding that the field could contain around 100 million barrels in reserves.

In a statement from its headquarters in Dubai, Dragon Oil also estimated the field's reserves at 100 million barrels.



The Civil Aviation Authority of Singapore (CAAS), Singapore Airlines (SIA), and Singapore-headquartered global investment company Temasek have selected ExxonMobil as the vendor to supply and deliver sustainable aviation fuel (SAF) as part of a pilot on the use of SAF in Singapore.

Under this pilot, SIA, with support from CAAS and Temasek, will purchase blended SAF from ExxonMobil. This product will comprise 1.25 million litres of neat SAF (sustainable fuels that are unmixed or undiluted), which will be supplied by Neste and produced from used cooking oil and waste animal fats, and blended with refined jet fuel at ExxonMobils facilities in Singapore.

This blended fuel will be delivered to Changi Airport via the airports existing fuel hydrant system by end-July 2022. From the third quarter of 2022, all Singapore Airlines and Scoot flights will use this blended fuel. The use of the SAF over the one-year pilot is expected to reduce about 2,500 tonnes of carbon dioxide emissions.

The appointment of ExxonMobil follows a Request for Proposal on 10 November 2021 to invite select producers and fuel suppliers to develop and execute plans to deliver blended SAF to Singapore Changi Airport. It is a follow-up to an earlier study conducted by the Singapore Government and industry players on the operational and commercial viability of using SAF at Changi Airport.

Ms Lee Wen Fen, Senior Vice President, Corporate Planning, Singapore Airlines, said: Sustainable aviation fuels are a key decarbonisation lever, and a critical pathway for the success of the SIA Groups commitment to achieve net zero carbon emissions by 2050. This pilot reinforces our commitment towards decarbonisation and sustainability across our operations. By collaborating with our partners, we can accelerate and scale up the adoption of sustainable aviation fuels in Singapore.

Russias Gazprom Neft

Russias Gazprom Neft, Japans Mitsui sign deal on decarbonisation

Russian oil producer Gazprom Neft and Japanese trading company Mitsui have signed a memorandum on teaming up in implementing decarbonisation projects in Russia and other countries, Gazprom Neft said on Tuesday.

They agreed to work in carbon capture and storage (CCS) and in integrated projects on producing bluehydrogen and using alternative fuels in marine and river transport.

Gazprom Neft has been forging partnerships with Russian and international companies in CO2 emissions reduction, hydrogen energy and cleaner fuels.

General Petroleum

Baker Hughes collaborates with Egyptian General Petroleum Corp.

Baker Hughes recently signed a Memorandum of Understanding (MoU) at the 2022 Egypt Petroleum Show (EGYPS) with the Egyptian General Petroleum Corp. (EGPC) that aims to establish and drive a flare recovery initiative to support emissions recovery and reduction across Egypts upstream and downstream oil and gas operations.

To enable flare recovery from oil and gas sites across Egypt, Baker Hughes will leverage its portfolio of emissions management solutions including flare management technology, compression, gas turbines, and integrated processing systems that can help in the measurement, management, recovery, and utilisation of flare gas.

Through the deployment of Baker Hughesemissions management solutions, EGPC will aim to reduce emissions and improve the efficiency of its oil and gas operations across the country. This will include reducing the amount of gas flared and vented into the environment, enabling EGPC to drive more efficiency by reutilising the gas that would otherwise go to waste.

In addition, and in support of the Ministrys Modernization Program, Baker Hughes solutions, including flare.IQ, will contribute to digitalising emissions management infrastructure by enabling EGPC to pull critical information about its flare systems to calculate optimum levels of flare efficiency and help reduce methane emissions.

Baker Hughesemissions management solutions will support EGPCs decarbonisation strategy, contributing to helping achieve ambitious carbon reduction targets, including positively impacting the quality of life for residents living in areas neighboring refineries.

As part of Egypts sustainable development vision, we are actively exploring opportunities that support our strategy of using clean energy and reducing emissions to accelerate our journey towards net-zero,said HE Tarek El Molla, Egyptian Minister of Petroleum and Mineral Resources. We are proud of EGPCs collaboration with Baker Hughes to deploy technologies that can help us manage and recover emissions across oil and gas operations, which is a key pillar in driving the energy transition in Egypt.

With a history stretching more than 100 years, Baker Hughes is proud to continue its partnership with Egypt and transform core oil and gas operations,said Lorenzo Simonelli, Chairman and CEO of Baker Hughes. We are committed to reaching net-zero by 2050, and our emissions management solutions help our customers reach similar goals and can directly benefit Egypts sustainable development vision. We look forward to COP27 being hosted in Egypt, where we will continue to support the countrys climate change agenda, as well as the broader regions just transition to new and sustainable sources of energy which are vital for its people and economy.

As Egypt prepares to host COP27 in November 2022, the Ministry of Petroleum and Mineral Resources aims to showcase data and findings from this project during the summit to demonstrate the role of the oil and gas sector in driving the countrys decarbonisation initiatives.


Shell looking to divest gas assets in southern UK North Sea

The company is looking to divest its 50% stake in a cluster of gas fields in the Clipper hub, and the Leman Alpha complex.

Shell is considering selling stakes in two gas fields clusters, located in the southern UK North Sea, Reuters has reported, citing industry sources.

The possible sale forms part of the firms efforts to retreat from the North Sea, where production has been declining since the late 1990s.

The ageing basin is triggering long-time oil and gas producers to shift focus to other more prolific and profitable business.

As part of the latest plan, Shell intends to divest a stake of 50% in a cluster of fields located in the Clipper hub, in addition to the Leman Alpha complex, according to three sources.

A potential sale of these assets could earn $1bn in proceeds for the company, the report added.

Production from the two gas fields is transferred to the onshore Shell-operated Bacton gas terminal complex, in eastern England, through a pipeline.

Located 66km from the Norfolk coast, the Clipper hub has a capacity to transport approximately 400 million standard cubic feet of gas per day.

The Clipper hub not only produces and processes gas from its own wells, but also imports and processes gas from the Barque, Skiff, Galleon, Carrack, and Cutter fields.

Last month, Shell renewed talks with the UKs offshore regulators over the Jackdaw gas field development, in the North Sea.

Earlier this month, Shell CEO Ben van Beurden said the company plans to sell assets, worth an average of $4bn, annually.

In recent years, Shell had divested stakes in several oil and gas assets in the North Sea. This include the sale of oil and gas producing assets to Harbour Energy for $3.8bn, in 2017.


Shell: 1st in Netherlands to offer bio-LNG

Shell said it became the first in the Netherlands to offer bio-LNG to all of its customers, following the launch of Nordsols bio-LNG installation at Amsterdam Westpoort.

In 2020, Renewi, Nordsol and Shell agreed upon building a Nordsol plant at a Renewi site at Amsterdam Westpoort. The plant opened in Fall 2021 and it is the first bio-LNG installation in the country.

As of this week, customers can fill up with Shell BioLNG. In the coming period, the bio-LNG in Shells Dutch LNG network will be mixed with regular LNG.

Bio-LNG is an important part of making heavy road and water transport more sustainable and eco-friendly. The fuel originates from organic waste flows, particularly domestic and agricultural waste that is available in abundance. It can be used in existing LNG engines and filling stations, without the need for modifications.

Marjan van Loon, CEO of Shell Netherlands, said that this is a great step towards clean transport.

Renewi collects organic waste throughout the Netherlands from multiple industries and converts it into biogas. Nordsol integrated and optimized processes into a compact installation that is able to convert biogas into bio-LNG.

Shell, a minority investor in Nordsol, distributes the fuel to nearby Shell LNG stations to supply customers with bio-LNG. Thus, it helps them to reduce their CO2 footprint.


BASF replaces plant for 2-Mercaptoethanol in Ludwigshafen

A new BASF production plant for the intermediate 2-mercaptoethanol (2-ME) at the Ludwigshafen Verbund site in Germany started regular operations in 4Q21.

After a trial run of several months, it replaces the previous plant at the Ludwigshafen site, which is being closed after more than 40 years of operation. The new plant is fully integrated into BASF's production Verbund and, with more than 10 000 tpy of 2-ME, has the same production capacity as the previous plant. 2-ME has proven its value in the production of plastics, crop protection products, oilfield chemicals (Basocorr® ME) and coatings.

'The new plant will enable us to supply our customers all over the world with 2-mercaptoethanol even more reliably. Our global logistics network, which our customers can further rely on, also contributes to this,' said Frank Stein, Head of the Regional Business Unit Europe in BASF's Intermediates division.

Saudi Aramco

Aramco shares switch may boost Saudi renewables

Saudi Aramco, the world's largest oil-exporting company, transferred 4% of its shares to the kingdom's Public Investment Fund, which is expected to use the proceeds towards domestic projects, the company said in a statement on Feb. 13 to the Tadawul where its shares trade.

The PIF is one of the biggest backers of renewable projects in Saudi Arabia, including the $500 billion futuristic Neom development.

The funds could be used for renewables, with Neom 'a large part of it,' said Robin Mills, CEO of Qamar Energy. 'There's a hydrogen project and other things around Neom.' He noted that $28 billion of Aramco's annual dividend of $75 billion goes to the fund, which is 'substantial funding.'

The PIF has the mandate from the Saudi state to put 70% of its assets in renewable projects in Saudi Arabia. Power projects and developments in solar and wind form part of 13 sectors the fund has chosen for development as part of the kingdom's Vision 2030 strategy intended to diversify the economy from oil.

The PIF continues to achieve its strategy by maximizing the value of its assets, launching new sectors, forming strategic partnerships, and localizing knowledge and technologies,' Saudi Arabia's Crown Prince Mohammed bin Salman said in a statement to the Saudi Press Agency.

Saudi Aramco and the PIF are closely linked, as Aramco's Chairman Yasir Al Rumayyan also serves as the governor of the fund.

'Following the transfer, the state remains Saudi Aramco's largest shareholder, retaining more than 94% shareholding,' Aramco said in a statement to the local bourse.

The transfer of shares was 'private' between the state and the PIF and Aramco was not a party to the transfer nor did it enter into any agreements regarding payments or receive proceeds from the transfer, it added.

The company first listed shares on the Saudi stock exchange, Tadawul, in 2019, raising $25.6 billion in the world's largest initial public offering. The company later sold more shares raising the total to $29.4 billion.


TotalEnergies to Buy SunPowers Commercial, Industrial Unit

TotalEnergies SE agreed to buy SunPower Corp.s commercial and industrial solar business for $250 million.

The price includes a $60 million earn-out, according to a statement. SunPower said in a separate regulatory filing that it will get $190 million in cash and up to $60 million more if certain legislative action is takenby June 30. TotalEnergies is the majority shareholder of SunPower.

The acquisition would extend TotalEnergiess distributed-generation business to the U.S. It comes months after San Jose, California-based SunPower said it was exploring strategic options for its commercial and industrial unit as it focuses on the residential sector.

For SunPower, this divestiture puts an end to the chronic quarterly choppiness associated with the segment,Pavel Molchanov, an analyst at Raymond James, said in a note Thursday.

SunPowers shares were up as much as 3.1% in intraday trading on Thursday.


Coca-Cola announces new space-age flavor

Global beverage giant The Coca-Cola Company unveiled its first limited-edition product, Coca-Cola Starlight, along with its new global innovation platform Coca-Cola Creations, to connect young consumers with innovative products and experiences.

Coca-Cola Starlight will be available in China in March. The new product was inspired by space, with a vision that in a world of infinite possibilities another way of connecting might exist.


Midea Group sets sights on auto parts for NEVs

Chinese home appliance giant Midea Group has set its sights on a new industry auto parts for new energy vehicles. The company is already one of the leaders in air conditioners, washing machines and industrial robots.

Midea, whose headquarters is in Foshan, Guangdong province, began construction of an auto parts base in Anqing city of East China's Anhui province on Wednesday.

Labeled as a strategic new base for NEV parts, the project has an overall investment of about 11 billion yuan ($1.74 billion).

It is designed to produce 60 million units of auto parts annually after its completion, with an annual output value of 40 billion yuan, company sources said.

The project in Anqing is a brand-new strategic base established by Midea after investing in Anhui Weiling Auto Parts Co Ltd, which is another major strategic layout of the company's industrial technology in the field of auto parts.

As the largest investment project in Midea's history, the base will mainly produce power steering motors, NEV electric compressors and drive motors of NEVs, the company said.

A research and development center and a national laboratory for thermal management, main drive and auxiliary and intelligent driving systems will also be built in the base.


Huawei says its Indian operations follow all laws and regulations

Huawei Technologies Co said on Thursday it is confident that the company's operations in India are firmly compliant with all laws and regulations.

The comments came after India's income tax authorities launched searches at multiple premises of Huawei as part of a tax investigation.

'We have been informed of the visit of the income tax team to our office and also of their meeting with some personnel,'Huawei said in a statement.

'We will approach related government departments for more information and fully cooperate as per the rules and regulations, and follow the right procedure,'it added.


ByteDance nets top user spends

Short video app Douyin and its overseas version TikTok continued to top the charts for in-app consumer spending among non-game mobile apps, the latest ranking report showed.

Users spent approximately $266 million in January alone in the star apps owned by China's ByteDance, data from digital intelligence firm Sensor Tower showed.

That figure was up 2.1 times from the same period last year, based on in-app expenditures in the two dominant mobile app markets: App Store and Google Play.

Their momentum had picked up on a robust trajectory since 2021, when some $2.3 billion was spent by users in the dual apps, up 77 percent year-on-year from $1.3 billion in 2020.

While China remains TikTok's largest market in terms of consumer spending, its share is being gradually diluted as the app becomes increasingly popular overseas. For instance, in the quarter ended December, some 57 percent of spending came from Chinese users, whereas China's App Store represented 85 percent of in-app spending in the fourth quarter of 2020.

The United States maintained its rank as the second-largest revenue-generator for TikTok, with its share in spending growing steadily. Between October and December, consumers in the US spent nearly $110 million in the app, representing 13 percent of global revenue. This was 5 percentage points higher than in the fourth quarter of 2020 when the US was responsible for $29.6 million, or around 8 percent of its worldwide spending.


Hershey's scotches exit rumor, confirms it's biz-as-usual in China

The Hershey Company, a US chocolate maker more famous as Hershey's, has scotched rumors it has exited China. Hershey's confirmed its team is continuing operations in the 'important' market unhindered.

'We continue to sell our products in China,' Hershey's said in a written reply to China Daily.

According to a report on Caijing Magazine's website, Hershey's will continue to invest in China and promote its business. The company told Caijing it does not have any direct-sale stores in China. The closure of dessert stores that sell its products, it clarified, has been the decision of its distributors, not Hershey's.

It may be recalled that Hershey's is upgrading its e-commerce business model in China. It has been revamping its official online store on Tmall, Alibaba's e-commerce platform, and will re-launch it by the end of this month.

As its sales surged during the Spring Festival holiday earlier this month, Hershey's said demand outstripped supply on its online store on JD, a major e-commerce platform in China, leading to 'out of stock' notices for many of its products. Hershey's is dealing with the shortage with its distributors. Fresh supplies are expected soon, Caijing reported.

Hershey's plan for the China market is to strengthen cooperation with hundreds of distributors and pursue growth opportunities through e-commerce platforms. It will also expand its snacks and baking products business lines, and cooperate with some catering channels, Caijing reported.


Huitongda poised to float on HK bourse

Huitongda Network Co, an e-commerce platform targeting merchants and suppliers in Chinese mainland's lower-tier cities and rural areas, is expected to debut on the Hong Kong stock exchange later this month should pre-marketing activity go smoothly.

The company, backed by e-commerce giant Alibaba Group, is looking to raise about $284 million after pricing its Hong Kong IPO at the bottom of its marketed range, Bloomberg News reported on Monday, citing market insiders.

Founded in late 2010, Nanjing-based Huitongda has more than 57,000 member stores in its network, covering 21 provinces and over 20,000 towns and villages across China.

Instead of targeting individual customers, the company mainly serves bite-sized business owners with two main pillarswholesale and business solutions.

It procures merchandise in six categories, from household appliances to auto parts, and sources it to merchants in rural regions. It also provides business solutions, such as the SaaS+ service, to help retail stores improve in-store management efficiency.

Huitongda registered a net loss of 157.9 million yuan ($24.7 million) in the first three quarters ending September, down from a net loss of 306.2 million yuan, according to its preliminary prospectus filed to the Hong Kong bourse. It said it plans to use the proceeds from the IPO to enhance merchant relationships, supply chains, information technology investment and data capabilities.

Retail lower-tier markets in China remain highly fragmented and less penetrated in digitalization, said a report by Frost & Sullivan cited in Huitongda's prospectus. The consultancy ranked Huitongda first in terms of transaction value of commerce business in lower-tier markets, but with a market share of less than 1 percent.


CNOOC's Guyana JV commences crude output

China National Offshore Oil Corp, the country's top offshore oil and gas driller, announced on Monday that its oilfield joint venture in Guyana in South America has commenced production safely and ahead of schedule on Monday.

The Liza Phase II oilfield, located in the Stabroek block off Guyana coast, includes one floating production storage and offloading unit and 30 subsea wellheads. It is expected to reach its peak production of about 220,000 barrels of crude oil per day within this year, CNOOC said.


Audi, FAW to kick off EV plant in China

German premium carmaker Audi and China's FAW are to kick off an electric vehicle plant in Changchun, capital of Northeast China's Jilin province.

Construction on the plant, with an investment of 20.9 billion yuan ($3.3 billion), will start in April this year, according to a Jilin government document.

The plant, with a designed production capacity of 150,000 units a year, will be ready by 2024, said Audi.

Audi said three models are now planned to be produced at the plant and the first two of them will be an SUV and a sedan.

Vehicles will be built on an electric car platform called PPE co-developed by Audi and Porsche.

The EV plant belongs to Audi FAW NEV Company, in which Audi holds a 55 percent stake. It is the first Chinese joint venture in which the German carmaker has a majority stake.


Beijing to get Legoland theme park

A Legoland theme park will come up in Beijing's Fangshan district as part of the Chinese national capital's plan to upgrade its suburban industrial layout.

In September 2021, Beijing became home to the Universal Beijing Resort.

The anticipated Legoland theme park figures among the nine new priority projects of culture and tourism for this year, according to a notice published on the website of the Beijing Municipal Commission of Development and Reform.

The joint venture project will be located in Fangshan district's Changyang town. An urban development subsidiary of Orient Group and UK-based Merlin Entertainments will own the project, the notice stated.

To be spread over 304,000 square meters, the Beijing Legoland theme park would consist of the Legoland resort, a themed hotel, a business street, a parking lot and more, according to a report in Beijing News.