• 4 minutes Pompeo: Aramco Attacks Are An "Act Of War" By Iran
  • 7 minutes Who Really Benefits From The "Iran Attacked Saudi Arabia" Narrative?
  • 11 minutes Trump Will Win In 2020
  • 15 minutes Experts review Saudi damage photos. Say Said is need to do a lot of explaining.
  • 22 mins Iran Vows Major War Even If US Conducts "Limited Strikes"
  • 4 hours Shale profitability
  • 1 hour Memorize date 05/15/2018 cause Huawei ban is the most important single event in world history after 9/11/2001.
  • 9 hours When Trying To Be Objective About Ethanol, Don't Include Big Oil Lies To Balance The Argument
  • 10 mins Hong Kong protesters appeal to Trump for support.
  • 2 hours Europe: The Cracks Are Beginning To Show
  • 11 hours Ethanol, the Perfect Home Remedy for A Saudi Oil Fever
  • 16 hours Let's shut down dissent like The Conversation in Australia
  • 10 hours One of the fire satellite pictures showed what look like the fire hit outside the main oil complex. Like it hit storage or pipeline facility. Not big deal.
  • 16 hours A little something for all you Offshore swabbies
  • 19 hours New designs will reduce transport fuels consumption
  • 4 hours LA Times: Vote Trump out in 2020 to Prevent Climate Apocalypse
  • 20 hours Democrats and Gun Views
  • 2 hours US and China are already in a full economic war and this battle for global hegemony is a little bit frightening
  • 7 hours Yawn... Parliament Poised to Force Brexit Delay Until Jan. 31
Alt Text

What The Market Is Overlooking In The Occidental Deal

Occidental Petroleum has caught a…

Alt Text

How To Play A Recovery In Oil Prices?

A realistic correction in the…

Dave Forest

Dave Forest

Dave is Managing Geologist of the Pierce Points Daily E-Letter.

More Info

Premium Content

Petro-Banking

It's surprising who's buying oil assets these days.

Not major oil companies. As we've discussed, firms like Apache have been busy divesting projects globally.

Brazilian oil heavyweight Petrobras has also been selling off assets. Last week the company agreed to sell $380 million worth of oil blocks and pipelines in Colombia.

This follows closely on a bigger divestment, that saw Petrobras sell 50% of its African unit for $1.53 billion.

The really interesting thing was the identity of the buyer. It wasn't a major oil producer. Not even a junior E&P. The purchaser was a bank.

Brazil's Banco BTG Pactual ponied up the billion-dollar sum to buy Petrobras' African assets.

Such direct ownership of exploration assets is an unusual strategy for a big bank like BTG. But it's not a one-off. The bank has made direct ownership of commodities plays part of its growth strategy. It is also reportedly looking to buy mining assets in Africa in partnership with former Vale CEO Roger Agnelli.

This may be a sign of the times. With commodities markets having turned down, most traditional companies in the space are shunning expansion in favour of cash-conservation and asset rationalization.

But that may well be an opportunity for non-traditional buyers like BTG. Such companies today are able to shop for assets with little competition.

That strategy appears to be paying off so far. The African projects of Petrobras were reportedly originally slated for sale at $5 billion. The fact that BTG could eventually pick them up for $1.5 billion suggests the firm may be one of the only games in town on the buy side.

We'll see if this approach ends in profit for the bank. But buying low during depressed times has long been a recipe for making money down the road. It will interesting to see how many other non-traditional players are thinking the same thing in regards to the natural resource space right now.

Here's to seizing opportunities,

By. Dave Forest




Download The Free Oilprice App Today

Back to homepage



Leave a comment

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News
Download on the App Store Get it on Google Play