TAQA will buy BP’s North Sea assets for $ 1.3 bn

Updated 28 November 2012
0

TAQA will buy BP’s North Sea assets for $ 1.3 bn

ABU DHABI: Abu Dhabi National Energy Co. (TAQA) will buy a number of BP's North Sea assets for over $ 1.3 billion in a sign relations between Britain and the Gulf emirate are on the mend.
The deal comes weeks after a visit by Prime Minister David Cameron to the emirate amid reports BP was set to lose i ts major role in the oil sector of the United Arab Emirates because of strained relations between the two countries.
The sale suggests BP could still win back its positions in the UAE, where the oil giant played a big role from the start of the oil industry in the early 1930s.
For TAQA, the deal is important as it boosts access to North Sea production, home to the global oil benchmark Brent. Companies gain valuable insight into oil pricing patterns when they operate in North Sea fields.
"This is a vote of confidence in the UK economy and once again, highlights the North Sea's position as a global energy hub," Cameron was quoted in a TAQA statement as saying.
TAQA said the deal followed a constructive dialogue between the oil and gas industry and the UK Treasury, resulting in changes to the tax treatment of North Sea assets.
TAQA, owned 75 percent by the Abu Dhabi government, is the largest investor from the United Arab Emirates in Britain, having invested over $ 3 billion in four years.
BP, which needs cash for repayments as part of the settlement for its US Macondo oil spill, said the TAQA deal brings its asset divestment program close to the targeted $ 38 billion as it has now entered into deals to sell assets worth around $ 37 billion.
BP said the sale will generate $ 1.058 billion plus future payments which, dependent on oil price and production, are expected to exceed $ 250 million.
BP will sell TAQA its interests in the Harding (70 percent), Maclure (37.03 percent), and Devenick (88.7 percent) fields in the Central North Sea.
TAQA will also increase its non-operated interests in the Brae area and associated transport infrastructure including the SAGE system, Forties-Brae and Forties-Braemar pipelines.
On completion, the acquisition is expected to increase TAQA's net production by approximately 21,000 barrels of oil equivalent per day from the current 40,000 boepd.
The deal will add 91 million boe to TAQA's reserves and add a second major development hub to TAQA's North Sea business, which is currently centered around the Northern sector.
TAQA's UK portfolio consists of the Brae Area assets, Beinn and Braemar fields, as well as the SAGE pipeline and onshore terminal, and the Brae-Miller Linkline. It has 100 percent operated equity in the Tern, Kestrel, Eider, Cormorant North, South Cormorant, Falcon and Pelican Fields.
It has a combined 26.73 percent interest in the Dana-operated Hudson field and a 24 percent interest in the Sullom Voe Terminal. TAQA also operates the Brent Pipeline System.
"This investment shows our commitment to the future of the North Sea. It is underpinned by the UK government's commitment to long term fiscal stability," said Hamad Al-Hurr Al-Suwaidi, chairman of TAQA.
TAQA, which has investments in the energy and power sector from India to the Middle East and Canada, aims to spend around $ 2 billion per year on capital investments.
But it plans to cut spending in North America by 30 percent next year to weather a downturn in commodity prices, its chief executive said earlier this month after reporting a third quarter loss.


Indonesia’s Go-Jek close to profits in all segments

Updated 18 August 2018
0

Indonesia’s Go-Jek close to profits in all segments

  • Go-Jek is Indonesia's first billio-dollar startup
  • Ride haling app evolves into online payment platform

JAKARTA: Go-Jek, Indonesia’s first billion-dollar startup, is “extremely close” to achieving profitability in all its segments, except transportation, its founder and CEO Nadiem Makarim told Reuters.

Launched in 2011 in Jakarta, Go-Jek — a play on the local word for motorbike taxis — has evolved from a ride-hailing service to a one-stop app allowing clients in Southeast Asia’s largest economy to make online payments and order everything from food, groceries to massages.

“We’re seeing enormous online to offline traction for all of our businesses and are close to being profitable, outside of transportation,” said the 34-year old CEO.
The startup is expected to be fully profitable “probably” within the next few years, Makarim added.

Already a market leader in Indonesia, where it processes more than 100 million transactions for its 20-25 million monthly users, Go-Jek is now looking to expand in Southeast Asia.

Ride hailing services in Southeast Asia are expected to surge to $20.1 billion in gross merchandise value by 2025 from $5.1 billion in 2017, according to a Google-Temasek report.

Go-Jek said in May it would invest $500 million to enter Vietnam, Singapore, Thailand and the Philippines, after Uber struck a deal to sell its Southeast Asian operations to Grab — the bigger player in the region.

Go-Jek is seeing strong funding interest from its backers as it targets an aggressive expansion, Makarim said.

“Since its Aug. 1 launch, the app has already grabbed 15 percent of market share in Ho Chi Minh,” Makarim said. The firm this week opened recruitment for motorcycle drivers in Thailand.

The startup expects anti-monopoly concerns swirling around the Grab-Uber deal, which Singapore said had substantially hurt competition, to help clear a path for its expansion.

“We’re bringing back choice. The Singapore government is particularly eager to bring back competition,” Makarim said, adding that the order of overseas rollouts had not been set.

Go-Jek’s offshore push comes at a time when Singapore-based Grab is stepping up funding to expand in Indonesia and transform itself into a consumer technology company, starting with a partnership with online grocer HappyFresh.

“Mimicking Go-Jek’s strategy is the highest form of flattery,” laughed Makarim.

Grab told Reuters in a statement, “The super app strategy has been around for a while now and no Southeast Asian player can claim to have pioneered it.” The company also said Grab has not lost market share in Ho Chi Minh since August, but declined to provide market share data.

Makarim believes Go-Jek’s understanding of food merchants will give it an edge over Grab, which counts investors such as Chinese ride-hailing firm Didi Chuxing and Japan’s SoftBank Group Corp. among its backers.

Makarim, who sees food delivery as Go-Jek’s core business, said he was not concerned about funding, without giving details.

Go-Jek was reported in June as being in talks to raise $1.5 billion in a new funding round and was valued at about $5 billion in a prior fundraising, sources have told Reuters. The firm had said in March it was considering a domestic IPO.

Makarim noted Go-Jek’s backers were sharing both capital and expertise. The company is collaborating with Alphabet Inc’s Google on platform mobility, Tencent on payments strategy, JD.com on logistics operations, and Meituan Dianping on merchant transactions and deliveries.

Go-Jek has set up a venture capital arm, Go-Ventures, to invest in startups in Southeast Asia “with strategic importance to our business,” the CEO said.