Saudi Arabia - joining the dots

A series of blog entries exploring Saudi Arabia's role in the oil markets with a brief look at the history of the royal family and politics that dictate and influence the Kingdom's oil policy

AIM - Assets In Market

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Iran negotiations - is the end nigh?

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Yemen: The Islamic Chessboard?

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Acquisition Criteria

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Valuation Series

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Showing posts with label Mubadala. Show all posts
Showing posts with label Mubadala. Show all posts

Monday 12 March 2018

Mubadala enters Zohr - acquires 10% from Eni


Mubadala has agreed to acquire a 10% interest in Zohr from USD934 million. Mubadala will acquire an interest in the Shorouk concession which contains the Zohr field. The super giant field came onstream in December 2017, 28 months after its discovery. The field is currently producing 400mmcfpd and planned to reach plateau by the end of 2019.

For Mubadala, this adds a world class asset with long term cash flows into its investment portfolio. Musabbeh Al Kaabi, Chief Executive Officer of Petroleum & Petrochemicals, Mubadala Investment Company, and Chairman of Mubadala Petroleum said: “This is an important and attractive investment for Mubadala, adding a world-class asset to our portfolio with long-term cash flows. We are joining a strong partnership with Eni as operator, who have delivered the project in record time and with the full support of the Egyptian authorities.”

For Eni, the deal is consistent with its strategy of monetising development and producing assets to recycle cash flows for exploration. It also reduces Eni’s portfolio weighting more towards OECD, a long term shift that the company continues to pursue. Claudio Descalzi, Chief Executive Office of Eni, said: “We are pleased to be working with Mubadala and welcome them into the partnership for the Shorouk concession. This represents a further signal about the strength and quality of this world class asset developed by Eni”.

The deal follows Eni’s farm-out of Zohr to BP and Rosneft in November and December 2016 prior to development spending. At the time, BP acquired 10% for USD525 million and 30% to Rosneft for USD1.125 billion. This compares with Mubadala’s current buy-in price of USD934 million for 10%.

Sunday 27 July 2014

Sebuku PSC

Overview

  • Contains 2 discoveries: Ruby gas field and the small Pangkat oil deposit
  • Plan of development for Ruby approved in July 2008
    • incorporates two bridge-linked platforms and initially four development wells
    • 312km pipeline to transport gas to new onshore receiving terminal for processing
    • Gas sold to the local Kaltim fertiliser plants
  • Ruby currently contracted to supply 85mmcfpd
    • Production capacity of 115mmcfpd, so scope to provide more gas
Participation
  • Mubadala (70%*), INPEX (15%), Total (15%)

Exploration
  • 11 wells drilled to date
  • Latest activity: Mubadala returned to drilling on the PSC in March 2010 - drilled NW Ruby-1 wildcat to test satellite prospect - unsuccessful
  • Further exploration planned
    • In March 2013, Mubadala awarded exploration block for the acreage surrounding Sebuku PSC, the West Sebuku block; 3D scheduled in 2014 with view to identifying future exploration prospects
Reserves, production and sales
  • Commercial WM: 215mmcfd (gross at 1/1/2014)
  • Production began in 2013 at 14mmcfpd, ramping up to 75mmcfpd in 2014
  • GSA signed in June 2011 for the supply of gas for 10 years to PT Pupuk Kaltim at c.80mmcfpd
    • Ruby gas to be predominantly used for fertiliser plant operations of the Kaltim V plant; however, as field declines, gas from other PSCs will be required to fulfil GSA
    • Price formula reflects local pricing and international ammonia and urea costs
      • Estimated USD/mcf: 2013 (7.7), 2014 (7.1), 2015 (7.0), 2016 (6.7)
Development
  • Currently produces from 4 wells, with additional drilling in future depending on reservoir performance
  • Installation/construction of onshore facilities finished at end 2012, offshore platforms in June 2013
  • First gas in October 2013
Fiscal and NPV
  • First Tranche Petroleum at 20%
  • Post-tax profit gas split is 65:35 in the government's favour; 80:20 for oil
  • Corporate tax of 40%
  • DMO applied at 6.7% after 60-month holiday, reimbursed at 15% of export price