BP Takes Nose Dive

By MarEx 2015-07-28 20:16:38

BP’s second-quarter profit slumped by nearly two thirds from last year as it grappled with lower oil prices, a write off in Libya and a $10.8 billion charge for the 2010 Deepwater Horizon oil spill in the Gulf of Mexico.

Expecting a prolonged period of lower crude prices, the British oil and gas company also cut its capital spending plans for this year for a second time to below $20 billion from $22.9 billion last year. (Norwegian rival Statoil announced has also spending cuts.)

BP’s Chief Financial Officer Brian Gilvary said he expected oil prices, which fell on Tuesday to their lowest since February below $53 a barrel, to remain soft in the medium term because of a supply glut worldwide.

BP reached an $18.7 billion agreement with the U.S. government and five states earlier this month to resolve most claims from the oil spill five years ago, the largest corporate settlement in U.S. history.

While BP had been expected to take a $10 billion hit at some point, it also agreed to pay up to $1 billion to resolve claims from some local government bodies, taking cumulative pretax charges for the Deepwater Horizon rig explosion and spill that killed 11 workers to a massive $55 billion.

Profits were also hit by a $600 million exploration write off in Libya because of security issues. Overall, BP’s underlying replacement cost profit, the company’s definition of net income, came in at $1.3 billion, below analyst expectations of $1.64 billion and down from $3.6 billion a year earlier.

BP has already cut about 5,000 jobs this year from a total of 80,000 employees at the end of 2014.

Positive Signs

Despite the profit slump, BP shares rose 1.7 percent in London by 1248 GMT slightly outperforming a 1.3 percent gain for the European oil and gas sector index.

“Cost cutting is being delivered and capex is coming in lower than previous guidance which are positives, together with the fact that Macondo is now behind us,” said an analyst at Bernstein, who have a “market perform” rating on the stock.

An Eye for Iran

Platts reports that BP will look for upstream opportunities in Iran once sanctions are lifted, but is unclear what Tehran’s intentions are for its new oil contracts, BP’s chief executive Bob Dudley said Tuesday.

Dudley added he was wary of rushing in before the sanction situation was clear.

“If the sanctions are relaxed in a way that allows us to go work there, obviously we would explore opportunities in Iran. We are not actively in that phase,” Dudley said.

Once sanctions are lifted, Iran hopes to attract oil majors to help it develop its reserves of about 157 billion barrels of oil and 1,200 Tcf of gas.

Iran held initial talks with companies including BP, Shell, Total and Eni earlier this year.

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Spanish Booty Found Off Florida

By Reuters 2015-07-28 16:37:16

A family of treasure hunters has found booty worth an estimated $1 million on an 18th century Spanish shipwreck off Florida, the company that hired them said.

The Spanish booty includes 51 gold coins, 12m of ornate gold chain and a single coin called a Royal that was made for then King Felipe V.

The latter is the most important piece of all because it is so rare, Brent Brisben of 1715 Fleet – Queens Jewels told the Florida Today news website.

That firm does treasure hunting work and also farms it out, and one of its subcontractors is a family called the Schmitt’s.

The family discovered the treasure a month ago in shallow waters off the town of Fort Pierce, working the Atlantic from a ship called the Aarrr Booty.

But their feat was kept secret until this week so as to coincide with the 300th anniversary of the sinking of a fleet of Spanish ships in a hurricane off Florida, in late July of 1715. The vessels were sailing from Cuba to Spain.

Keeping quiet was “particularly hard for the family that found it. They’ve been beside themselves,” Brisben said.

The treasure is in very good condition, he added.

“One of the most amazing recoveries in 1715 Fleet History. Congratulations to the entire Schmitt family and the crew of the Aarrr Booty,” the company said in a Facebook post.

After the fleet went down in 1715, Spain recovered much of the sunken treasure. But hundreds of thousands of coins remain on the sea bed. 1715 Fleet – Queens Jewels estimates that, at a price of US$250 per coin they are worth US$550 million.

The company has made other finds stemming from the 1715 storm.

Under Florida law, the state keeps 20 per cent of the treasure and the rest is shared evenly by the family and the company.

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New Digs for Egypt

By MarEx 2015-07-28 14:42:07

The Suez Canal is getting new digs as Egypt has authorized expansion of a 9.5 kilometer-long to allow two-way traffic of ships transiting the northern terminus of Port Said. The Suez Canal Authority (SCA) has agreed to contract the “Alliance of Challenge,” which is the combination of six companies that already completed the dredging of the new canal.

The Suez Canal Expansion Project granted APM Terminals’ Suez Canal Container Terminal (SCCT) permission to dredge the two-way traffic zone. Currently, vessels entering the canal on the northern terminus had to wait a few hours before passing through the canal.

The Suez Canal Authority (SCA) recently completed its first two-way traffic trial run in the main canal. Seven companies are working in concert to complete the new canal’s dredging. This partnership includes the SCA’s dredging vessels, the Emirati National Marine Dredging Company, the U.S. Great Lakes Dredge & Dock Company, Van Oord, Jan De Nul and the DEME Group.

APM Terminals is lifting global trade with a Global Terminal Network of 20,600 professionals and 200 port and inland services operations in 58 countries around the globe. APM Terminals designs, builds and operates port and terminal facilities, as well as providing cargo Inland Services for cargo transportation between port facilities and inland locations, as well as other associated cargo handling functions. Its world headquarters in The Hague, The Netherlands, APM Terminals is an independent business unit within the Danish-based Maersk Group.

The publicly funded project cost Egypt about $8.6 billion.

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Fugitive Ship Flees

By MarEx 2015-07-28 13:18:57

Turkish cargo ship Feyza Genc fled after being served an arrest warrant by Maltese authorities. Cassar Fuel Limited is claiming damages of 45,818 EUR ($49,715) for unpaid fuel invoices over a year ago. According to reports, the vessel was detained by the coast guard and ordered to remain in Bunking Area 3—which is nine miles off the Maltese coast—until court proceedings commenced. Overnight, the M/V Feyza Genc fled and was last seen near the Greek island of Karpathos. The Maltese court will begin investigations shortly and charge the operators for violating the country’s laws.

The Feyza Genc entered Malta last week and the warrant was issued by the Civil Court of Malta on July 24. The ship was built in Istanbul in 1993 and is owned and operated by the Turkish company GNC Shipping.

GNC Shipping denies any wrongdoing calling the arrest “totally malicious” in a statement.

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