this does seem like a rather passive board, but energy stocks generally aren't as exciting as tech stocks (and forums)
DUBAI (Reuters) - Three state-owned Gulf firms are considering a joint bid for a minority stake in Occidental Petroleum Corp's (OXY) Middle East and North Africa (MENA) unit, a deal that could be worth between $8 billion and $10 billion, three banking sources said.
Abu Dhabi's Mubadala Development Co (MUDEV.UL), Qatar Petroleum (QATPE.UL) and Oman Oil Co have formed a consortium and have picked Citigroup (NYS:C) to advise them, the sources with knowledge of the matter said on Monday. They spoke on condition of anonymity as the information is not public.
Occidental, the fourth-largest U.S. oil company, said in October it planned to sell a minority stake in its MENA operations as part of a restructuring meant to lift its valuation. On Monday two of the sources said it could sell a 40 percent stake to the three Gulf firms.
Occidental and Qatar Petroleum were not immediately available for comment, while Citi and Mubadala declined to comment. Oman Oil could not be reached for comment.
I have detected a Cup with Handle. The Cup has been forming for a year and is starting to break out. Most likely this will happen when deals on signed on sale of assets.
Sentiment: Strong Buy
I think it's fair to say everybody has been frustrated. And it's "companies" =P
LOS ANGELES, Oct 18, 2013 (BUSINESS WIRE) -- Occidental Petroleum Corporation OXY -0.47% today announced the initial actions resulting from the Company's strategic review to streamline and focus operations in order to better execute the Company's long-term strategy and enhance value for shareholders.
The Board of Directors has authorized the following:
-- Pursue the sale of a minority interest in the Middle East/North Africa operations in a financially efficient manner. (See Attachment A.)
-- Pursue strategic alternatives for select Midcontinent assets, including oil and gas interests in the Williston Basin, Hugoton Field, Piceance Basin and other Rocky Mountain assets. (See Attachment B.)
-- Sale of a portion of the Company's 35-percent investment in the General Partner of Plains All-American Pipeline, L.P., resulting in pre-tax proceeds of $1.3 billion. Occidental's remaining interest in Plains All-American Pipeline, based on the IPO price, is worth approximately $3.4 billion.
"These are the first formal steps in our effort to streamline the business, concentrate in areas where we have depth and scale and improve overall profitability. Our goal is to become a somewhat smaller company with more manageable exposure to political risk," said Stephen I. Chazen, President and Chief Executive Officer. "We will continue to consider additional strategic alternatives for the Company to maximize total returns to our shareholders."
That's right, 2 1/2 years ago, the pps for OXY was at $114 a share. Other major oil company's pps's have gained significantly during the same time period. The only saving grace for the stock and it's shareholders has been an increase in dividends on an annual basis.
Mr. Chazen needs to come up with a plan, and soon, to increase shareholder value.
Investors were involved in expressing their displeasure with the status quo when they gave Irani the boot. The restructuring was long overdue, with too much risk in it's exposure in the Middle East. Question is will the big holders be happy with what is happening now. It takes time to dispose of assets and get fair value. Some of these E&P's had more leasehold property than they could possibly develop even in the intermediate future. Institution investors may have made some recommendations to Chazen; however, the company is going to do what makes sense from an operations & financial perspective. Personally I am not in a hurry because I think that over the next 1, 3 and 5 years we continue to go higher.
My biggest problem is why operations were so poor for so long, when they just started to turn it around recently and pretty quickly. They have ben wasting resources due to bad management. That is inexcusable.
OXY's exit from the Middle East is more of a push from institutional investors, than a stategic move by OXY management. Interesting how the financial press can twist things.
Sentiment: Strong Buy
The world is recovering after five years in the toilet. Commodity prices are abating. in the last 115 years there have been only 3 secular bull markets (1923 - 30), (1952 - 1968) and (1982 - 2000). All were accompanied by relatively low commodities. All the other periods in between were dominated by commodities and the market traded within a range. In the modern world oil is essential in any sustained economic period. There may be enough oil to keep the price from reaching $148 again: however, in an around $100 is most likely and E&P's can do very well at those levels.
There was an item on NPR the other night that started me thinking...With talks in the news about Iran and nuclear negotiations...the ramifications include a significant amount of oil coming into the world market, possibly depressing prices below attractive levels for higher cost US domestic production. Anyone run that scenario?
PXD has a $26 billion market cap. That might be more than OXY would want to chew on. They are selling a lot of assets, but the big money wants them to return the money to shareholders in buy backs. It is a very interesting idea if you were running the company for the long pull and didn't have the usual fast change artists involved in the stock.
NEUN is the stock to watch. Financials show some huge assets along with proven mining properties. You need to start some research on NEUN, could be the next mining play to really make investors rich
Get the full NEUN profile at: creativework.asia/799875