Tag Archives: GY

Exclusive: China’s oil champion prepares Western retreat over sanctions fear

Men wearing face masks walk past a sign of China National Offshore Oil Corp (CNOOC) outside its headquarters in Beijing, China March 8, 2021. REUTERS/Tingshu Wang

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  • CNOOC preparing to exit Britain, Canada, U.S. -sources
  • Beijing concerned over growing tension with West
  • Production in three countries reached 220,000 boed last year
  • Decision follows CNOOC’s delisting on New York Stock Exchange

LONDON/SINGAPORE, April 13 (Reuters) – China’s top offshore oil and gas producer CNOOC Ltd. (0883.HK) is preparing to exit its operations in Britain, Canada and the United States, because of concerns in Beijing the assets could become subject to Western sanctions, industry sources said.

Ties between China and the West have long been strained by trade and human rights issues and the tension has grown following Russia’s invasion of Ukraine, which China has refused to condemn.

The United States said last week China could face consequences if it helped Russia to evade Western sanctions that have included financial measures that restrict Russia’s access to foreign currency and make it complicated to process international payments. read more

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CNOOC did not immediately comment.

Companies periodically carry out reviews of their portfolios, but the exit being prepared would take place less than a decade after state-owned CNOOC entered the three countries via a $15 billion acquisition of Canada’s Nexen, a deal that transformed the Chinese champion into a leading global producer.

The assets, which include stakes in major fields in the North Sea, the Gulf of Mexico and large Canadian oil sand projects, produce around 220,000 barrels of oil equivalent per day (boed), Reuters calculations found.

Last month, Reuters reported CNOOC had hired Bank of America to prepare for the sale of its North Sea assets, which include a stake in one of the basin’s largest fields. read more

CNOOC has launched a global portfolio review ahead of its planned public listing in the Shanghai stock exchange later this month that is aimed primarily at tapping alternative funding following the delisting of its U.S. shares last October, the sources said. read more

The delisting was part of a move by former U.S. President Donald Trump’s administration in 2020 that targeted several Chinese companies Washington said were owned or controlled by the Chinese military. China condemned the move.

CNOOC is also taking advantage of a rally in oil and gas prices, driven by Russia’s invasion of Ukraine on Feb. 24, and hopes to attract buyers as Western countries seek to develop domestic production to substitute Russian energy.

As it seeks to leave the West, CNOOC is looking to acquire new assets in Latin America and Africa, and also wants to prioritise the development of large, new prospects in Brazil, Guyana and Uganda, the sources said.

‘A PAIN’

CNOOC is seeking to sell “marginal and hard to manage” assets in Britain, Canada and the United States, a senior industry source told Reuters.

All the sources spoke on condition of anonymity because of the sensitivity of the issue.

The industry source said last month that CNOOC’s top management, including chairman Wang Dongjin, found managing the former Nexen assets was “uncomfortable” because of red tape and high operating costs compared with developing nations.

CNOOC has faced hurdles operating in the United States in particular, such as security clearances required by Washington for its Chinese executives to enter the country, the source added.

“Assets like Gulf of Mexico deepwater are technologically challenging and CNOOC really needed to work with partners to learn, but company executives were not even allowed to visit the U.S. offices. It had been a pain all along these years and the Trump administration’s blacklisting of CNOOC made it worse,” said the source.

In its prospectus ahead of the initial public offering, CNOOC said it could face additional sanctions.

“We cannot predict if the company or its affiliates and partners will be affected by U.S. sanctions in future, if policies change,” CNOOC said.

In the United States, CNOOC owns assets in the onshore Eagle Ford and Rockies shale basins as well as stakes in two large offshore fields in the Gulf of Mexico, Appomattox and Stampede.

Its main Canadian assets oil sands projects are Long Lake and Hangingstone in Alberta Province.

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Reporting by Ron Bousso and Chen Aizhu; editing by Barbara Lewis

Our Standards: The Thomson Reuters Trust Principles.

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‘Death sentence’: low-lying nations implore faster action on climate at U.N.

UNITED NATIONS, Sept 23 (Reuters) – Faced with what they see as an existential threat, leaders from low-lying and island nations implored rich countries at the United Nations General Assembly this week to act more forcefully against a warming planet.

The failure by developed economies to effectively curb their greenhouse gas emissions contributes to rising sea levels and especially imperils island and low-lying nations at the mercy of water.

“We simply have no higher ground to cede,” Marshall Islands President David Kabua told leaders in a pre-recorded speech at the high-level gathering on Wednesday. “The world simply cannot delay climate ambition any further.”

Countries agreed under the 2015 Paris Agreement on climate change mitigation to attempt to limit the rise in global temperatures to 1.5 degrees Celsius (2.7 degrees Fahrenheit), the threshold scientists say would head off the worst impacts of warming. To do that, scientists say, the world needs to cut global emissions in half by 2030, and to net-zero by 2050.

“The difference between 1.5 degrees and 2 degrees is a death sentence for the Maldives,” President Ibrahim Mohamed Solih told world leaders on Tuesday.

Guyana President Irfaan Ali criticized large polluters for not delivering on promises to curb emissions, accusing them of “deception” and “failure” and warning that climate change will kill far more people than the COVID-19 pandemic.

“We hold out similar hope that the world’s worst emitters of greenhouse gases that are affecting the welfare of all mankind will also come to the realization that, in the end, it will profit them little to emerge king over a world of dust,” Ali told world leaders on Thursday.

He said small island states and countries with low-lying coastlines, like Guyana, will bear the full brunt of the impending disaster despite being among the lowest emitters of greenhouse gases.

“This is not only unfair, it is unjust,” he said.

Richard Gowan, U.N. director at the International Crisis Group, said there had been a “sense of existential crisis” running through the annual gathering at the United Nations.

“Both Beijing and Washington want to show they are leading the fight against global warming. If the small islands’ leaders can’t get people to listen at this General Assembly, they never will,” Gowan said.

U.S. President Joe Biden said on Tuesday he would work with Congress to double funds by 2024 to $11.4 billion per year to help developing nations deal with climate change.

Palau’s President Surangel Whipps addresses the 76th Session of the United Nations General Assembly at the U.N. headquarters in New York, U.S., September 21, 2021. Mary Altaffer/Pool via REUTERS

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The funding would help achieve a global goal set more than a decade ago of $100 billion per year to support climate action in vulnerable countries by 2020.

Chinese President Xi Jinping pledged to stop building coal-fired power plants overseas, a move widely welcomed.

‘WE MUST ACT NOW’

Biden and Xi made their commitments less than six weeks before the Oct. 31-Nov. 12 COP26 U.N. Climate Change Conference in Glasgow, Scotland, which U.N. Secretary-General Antonio Guterres said runs the risk of failure over mistrust between rich and poor countries.

President Chan Santokhi of Suriname, where much of the coastal area is low-lying, called for “ambitious and actionable commitments” to be made at COP26, urging developed countries to recommit to the $100 billion per year.

Santokhi said that ideals and political commitments do not mean much if not supported by new financial resources.

“In the case of my country, Suriname, and the countries with low-lying coastal areas, we are committed to fighting climate change because we are particularly vulnerable even though we have contributed the least to this problem,” he told the General Assembly.

The Pacific archipelago nation of Palau warned the world is running out of time.

“Simply put, we must act now to ensure our children inherit a healthy and reliable future. We need to act now before further irreparable damage is made to our planet,” Palau President Surangel Whipps Jr., said at the gathering.

U.K. Prime Minister Boris Johnson, who is preparing to host COP26, on Wednesday called on world leaders to make the necessary commitments and a collective pledge to achieve carbon neutrality by 2050.

He warned that, on the current track, temperatures will go up by 2.7 degrees Celsius or more by the end of the century.

“Nevermind what that will do to the ice floes, dissolving like ice in your martini here in New York,” Johnson said. “We will see desertification, drought, crop failure and mass movements of humanity on a scale not seen before, not because of some unforeseen natural event or disaster, but because of us, because of what we are doing now.”

Reporting by Daphne Psaledakis and Michelle Nichols; Additional reporting by Valerie Volcovici; Editing by Mary Milliken and Grant McCool

Our Standards: The Thomson Reuters Trust Principles.

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