• 1 day PDVSA Booted From Caribbean Terminal Over Unpaid Bills
  • 1 day Russia Warns Ukraine Against Recovering Oil Off The Coast Of Crimea
  • 1 day Syrian Rebels Relinquish Control Of Major Gas Field
  • 1 day Schlumberger Warns Of Moderating Investment In North America
  • 1 day Oil Prices Set For Weekly Loss As Profit Taking Trumps Mideast Tensions
  • 2 days Energy Regulators Look To Guard Grid From Cyberattacks
  • 2 days Mexico Says OPEC Has Not Approached It For Deal Extension
  • 2 days New Video Game Targets Oil Infrastructure
  • 2 days Shell Restarts Bonny Light Exports
  • 2 days Russia’s Rosneft To Take Majority In Kurdish Oil Pipeline
  • 2 days Iraq Struggles To Replace Damaged Kirkuk Equipment As Output Falls
  • 2 days British Utility Companies Brace For Major Reforms
  • 2 days Montenegro A ‘Sweet Spot’ Of Untapped Oil, Gas In The Adriatic
  • 2 days Rosneft CEO: Rising U.S. Shale A Downside Risk To Oil Prices
  • 3 days Brazil Could Invite More Bids For Unsold Pre-Salt Oil Blocks
  • 3 days OPEC/Non-OPEC Seek Consensus On Deal Before Nov Summit
  • 3 days London Stock Exchange Boss Defends Push To Win Aramco IPO
  • 3 days Rosneft Signs $400M Deal With Kurdistan
  • 3 days Kinder Morgan Warns About Trans Mountain Delays
  • 3 days India, China, U.S., Complain Of Venezuelan Crude Oil Quality Issues
  • 3 days Kurdish Kirkuk-Ceyhan Crude Oil Flows Plunge To 225,000 Bpd
  • 3 days Russia, Saudis Team Up To Boost Fracking Tech
  • 4 days Conflicting News Spurs Doubt On Aramco IPO
  • 4 days Exxon Starts Production At New Refinery In Texas
  • 4 days Iraq Asks BP To Redevelop Kirkuk Oil Fields
  • 4 days Oil Prices Rise After U.S. API Reports Strong Crude Inventory Draw
  • 5 days Oil Gains Spur Growth In Canada’s Oil Cities
  • 5 days China To Take 5% Of Rosneft’s Output In New Deal
  • 5 days UAE Oil Giant Seeks Partnership For Possible IPO
  • 5 days Planting Trees Could Cut Emissions As Much As Quitting Oil
  • 5 days VW Fails To Secure Critical Commodity For EVs
  • 5 days Enbridge Pipeline Expansion Finally Approved
  • 5 days Iraqi Forces Seize Control Of North Oil Co Fields In Kirkuk
  • 5 days OPEC Oil Deal Compliance Falls To 86%
  • 5 days U.S. Oil Production To Increase in November As Rig Count Falls
  • 5 days Gazprom Neft Unhappy With OPEC-Russia Production Cut Deal
  • 6 days Disputed Venezuelan Vote Could Lead To More Sanctions, Clashes
  • 6 days EU Urges U.S. Congress To Protect Iran Nuclear Deal
  • 6 days Oil Rig Explosion In Louisiana Leaves 7 Injured, 1 Still Missing
  • 6 days Aramco Says No Plans To Shelve IPO
Alt Text

2 Red Flags For The World’s Top Shale Play

Changing legislation and taxation for…

Alt Text

The Natural Gas Market Is Set To Boom

With the new lower-for-longer oil…

Alt Text

The U.S. LNG Boom Could Be About To Stall

United States LNG has seen…

Why Is China Buying Up These Unprofitable Natural Gas Assets?

Chevron Bangladesh

Big surge in oil and gas M&A the last few months. With watchdogs Evaluate Energy reporting that Canadian energy deals have already totaled $32.8 billion in 2017 — nearly as much as full-year 2015 and 2016 combined.

That uptick has been driven by global majors selling oil sands assets. And elsewhere in the world, another big firm shed unloved fields this week — to a surprising buyer, which may show an important geopolitical shift underway.

In Southeast Asia.

The place is Bangladesh. And the seller is Chevron — which announced Monday it is divesting its portfolio of natural gas production in the country.

It’s been widely known that Chevron’s Bangladesh assets were on the block. With the company announcing its intent to pull out of the country after the government denied a request for a hike in natgas prices, in 2015.

Chevron subsequently said that the current $2.76/Mcf rate it receives at its fields here is too low to make money. Causing the company to scrap plans for $650 million of new investment in the Bangladesh portfolio — which produces a significant 1.55 billion cubic feet per day.

The question then became: who would buy these apparently unprofitable fields?

And this week the answer emerged.

China.

Chevron said it is selling its Bangladesh portfolio to Himalaya Energy — a joint venture between state-owned China ZhenHua Oil and Hong Kong investment firm CNIC Corporation. Related: Low Oil Prices Force Abu Dhabi To Sell U.S. Assets

The price tag for the deal wasn’t disclosed — but given the production levels here, it’s likely sizeable. Raising the question, why would the Chinese firms pay up for fields that are close to losing money?

The answer may be, influence.

The Southeast Asian sphere has recently become an energy focus for China — evidenced by the launch of mega-projects like a 770-km oil pipeline across Myanmar to Kunming.

Chevron’s offshore Bangladesh fields lie just a few hundred kilometers from that pipeline’s docking point in Myanmar. Suggesting this week’s deal could be a move to further increase power in this critical supply region — especially given that Chevron’s production makes up 58% of national Bangladesh supply.

That gives China a stranglehold on energy flows here. Watch to see if that influence might in fact kill the deal — with Bangladesh state oil firm Petrobangla saying it is looking at exercising a right of first refusal on the Chevron assets. The outcome here could quietly reshape the energy picture in this part of the world.

Here’s to the hidden value.

By Dave Forest

More Top Reads From Oilprice.com:




Back to homepage


Leave a comment
  • Dan on April 26 2017 said:
    Chevron thinks oil,gas how much they can steal from investors before retiring. China thinks long term, Silk Road, economic growth for all countries within Silk Road realm. Everyone is a customer.
  • Kthor on May 01 2017 said:
    China will steal those NatGas (export) and sell it back at a higher price (Import)

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News