The Threat Of A Jihadist Resurgence In West Africa

Politics, Geopolitics, & Conflict

Jihadist groups are resurging in West Africa as the coup in Niger creates instability on borders and gives Islamist radicals in the Sahel a reason to feel emboldened. Not only is the coup in Niger a potential catalyst for a regional war, but it is also a fast-track to the return in full force of radical Islamist groups (the Islamic State, or IS, and al-Qaida affiliate Jama'at Nusrat al-Islam wal-Muslimin) operating in the region. Jihadists ambushed and killed 17 soldiers on Wednesday near the border with Mali, according to Niger's junta leaders.

Wage disputes at Australia's biggest LNG facility have markets concerned about tight gas supply. As of the time of writing, Woodside Energy and a union alliance had not yet come to a deal.

A Lebanese environmental activism group, Green Without Borders, has been sanctioned by the U.S. Department of Treasury for acting as a front for Hezbollah operating along the Israeli-Lebanese border (the Blue Line). Posing as environmental activists, the group is said to have served as a front, particularly for Hezbollah warehouses, munitions depots, tunnels, and training grounds.

Deals, Mergers & Acquisitions

GM is investing $60 million in Mitra Chem to speed up the development of more affordable battery chemistry for EVs. Mitra Chem is a California-based company that uses AI to accelerate the development of battery materials. The materials, like LMFP, could be used in their next-gen Ultium batteries. GM said the IRA was a main driver behind its collaboration with Mitra Chem to build out a supply chain for lithium-ion phosphate batteries and next-gen materials.

OXY has reached a $1.1B deal to acquire Carbon Engineering to bolster its carbon capture businesses. OXY has utlized Carbon Engineering for years and has plans to build the largest direct air capture project in the world in Texas. Oxy CEO Vicki Hollub has previously said that Oxy's low-carbon business will be equal to the revenue, earnings, and cash flow of its chemicals business, capable of generating more than $1.3 billion in income. A successful carbon capture plan would keep OXY producing oil for longer even while meeting decarbonization plans.

Earnings Beat

Suncor's Q2 2023 revenues were down 27% from Q2 2022, at CA$11.7B. Net income fell by 53% to CA$1.88B, for a 16% profit margin. EPS for the quarter was CA$1.44, down from CA$2.81 in Q2 2022. Suncor's revenues were still greater than analyst expectations.

JinkoSolar Holding reported Q2 2023 earnings of $3.35, beating analyst estimates and more than double the $1.10 EPS from Q2 2022. Total revenues for the quarter were $4.2B-up 62.9% year over year. Jinko launched its 2nd Gen high-voltage energy storage battery in the European market.

Discovery & Development

Frontera expects to complete its Wei-1 oil well analysis over the course of the next two-to-three months, after which it will decide whether or not to upgrade an exploration license in Guyana to its development phase. The analysis is expected to reveal the potential of the Corentyne block.

Lebanon has received an offshore drilling rig and will commence its search for gas sometime in September near the Israeli border near the southern port city of Tyre. A sizeable gas discovery would be a game changer for cash-strapped Lebanon which is currently embroiled in a financial crisis. Lebanon is hopeful it can become an oil state.

The EIA completed this week their 90-day assessment of the high adjustment figures that we have been seeing regularly in the weekly and monthly crude oil data. The EIA's analysis concluded that crude blending and underreporting of light hydrocarbon production were behind the adjustments, and it will now set out a plan to redo its surveys and alter some reports, although this is expected to take quite some time to complete. The EIA provided a detailed explanation of its efforts here.