Saudi, Kuwait to sign deal to resume joint oilfield output

Kuwaiti Oil Minister Khaled al-Fadhel attends a meeting of members of the Organization of Arab Petroleum Exporting Countries (OAPEC) in Kuwait City on December 22, 2019. (AFP)
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Updated 23 December 2019

Saudi, Kuwait to sign deal to resume joint oilfield output

  • The Kuwait Gulf Oil Company (KGOC) said the signing ceremony will take place in the neutral zone

KUWAIT CITY: Saudi Arabia and Kuwait will sign a deal on Tuesday to resume production at two major oilfields in a shared neutral zone after five years of stoppage.
The Kuwait Gulf Oil Company (KGOC) said on Monday the signing ceremony will take place in the neutral zone where the offshore Khafji field and onshore Wafra field are located.
The two fields were pumping some 500,000 barrels per day before production was halted first at Khafji in October 2014 and then at Wafra months later over a dispute between the two Arab Gulf neighbors.
Riyadh said at the time the decision was due to environmental issues.
The oil produced in the neutral zone in the border area is shared equally between the two nations.
Khafji was jointly operated by KGOC and Saudi Aramco Gulf Operations, while Wafra was operated by KGOC and Saudi Arabian Chevron.
It was not immediately specified when the two fields will start pumping again, but the agreement comes as oil prices are under pressure due to abundant reserves and weak global economic growth.
The slump has prompted OPEC and its allies to make deeper production cuts starting next month.
Saudi Arabia pumps just under 10 million bpd, while Kuwait produces around 2.7 million bpd.


Commerzbank slapped with fine for deals with defunct Cypriot bank

Updated 05 July 2020

Commerzbank slapped with fine for deals with defunct Cypriot bank

  • Laiki, once Cyprus’s second-largest bank, was taken into administration and wound down in March 2013

FRANKFURT: Cyprus’s securities regulator has imposed a €650,000 ($730,800) fine on Germany’s Commerzbank for its role in transactions carried out by a local bank that collapsed during the country’s 2013 financial crisis.

The country’s CySEC commission said Commerzbank had been sanctioned over investment operations conducted by the now-defunct Laiki — also known as Cyprus Popular Bank — in 2011, following Laiki’s merger with Greece’s Marfin-Egnatia Bank.

Commerzbank declined to comment on the case, which followed an eight-year probe by Cypriot authorities.

The investigation, which was launched following calls by left-wing AKEL lawmaker Irene Charalambides, looked into whether the Cypriot deals may have broken laws prohibiting a company from buying its own stock.

CySEC said Laiki invested in two structured products issued by Commerzbank in 2008. Marfin-Egnatia, which was at that time a Laiki subsidiary, was an index sponsor responsible for the composition of the portfolio.

As a result of the 2011 merger between Laiki and Marfin-Egnatia, Laiki became the index sponsor, creating a conflict of interest, CySEC said.

It said Laiki and Commerzbank acted in “concert” to manipulate the market in relation to Laiki shares on several occasions in April and May 2011.

CySEC said it had not fined Laiki because it is in administration and did not want to put an additional burden on former depositors, bond holders and shareholders.

Laiki, once Cyprus’s second-largest bank, was taken into administration and wound down under terms of a €10 billion international financial assistance package to Cyprus in March 2013.

Some €4.3 billion in uninsured deposits exceeding the EU threshold of 100,000 were wiped out, and thousands of people lost their life savings.

Charalambides said she felt vindicated by the result of the investigation.

“The resolution authority should consider the possibility of civil lawsuits against Commerzbank to ensure that the funds channelled to these structured bonds, with the objective of manipulating shares, be returned, and given to depositors whose funds were subjected to a haircut,” she said in a statement.