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Iran Looks To Poach Saudi Oil Contracts With New Projects By Simon Watkins - Jan 18, 2021, 7:00 PM CST
Iran has been looking in earnest to poach major oil supply contracts from Saudi Arabia since the Tehran-backed Houthi attacks on two of the Kingdom’s key oil facilities on 14 September 2019, especially for coveted Asian customers. Following Saudi’s decision to unilaterally cut one million barrels per day (bpd) below its latest OPEC+ quota originally set last month, Tehran announced last week that the National Iranian Oil Company (NIOC) has signed US$1.2 billion-worth of contracts for eight new projects designed to significantly increase its crude oil production. Although these projects will be broadly managed by Iranian companies, they are part of a patchwork of projects that were formulated in tandem with the 25-year deal made with China in 2019, which will heavily feature Chinese companies working on a ‘contract-only’ basis, albeit lots of con
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Why Oil Companies Can’t Replace Oil Profits With Renewable Profits By Leonard Hyman & William Tilles - Jan 19, 2021, 2:00 PM CST
Last week we argued in Oilprice.com (“Can Renewables Become As Profitable As Oil and Gas?”, January 5, 2021) that oil companies could not maintain their expected levels of profitability by investing massively in renewable energy companies. The reason? A mismatch between business and financial risk in these very different industries.
In financial theory, there are two related concepts of risk that determine the level of expected investor return: business risk (the inherent operating risk of a going concern) and financial risk (the degree of leverage or debt managements utilize in the company’s capital structure). There are two key things to consider here. First, there is typically an inverse relationship between business and financial risk. Stated simply, the higher the operating risk of a business the less debt it can
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Colombia Is Betting Big On Wind And Solar By Tatiana Serova - Jan 18, 2021, 2:00 PM CST
For Colombia, 2021 is starting with the promise of a boom in renewable energy generation. On January 14th, the Ministry of Finance announced the offering of its first green bonds next July, aimed at funding environmental projects, notably renewable energy plants. A new round of auction allocating 5 GW of wind and solar capacity for long-term PPAs is also slated for 2021. And although renewable energy sources (excluding hydropower) currently represent only 1% of the country’s electricity mix, Ivan Duque s government is determined to make them the next energy frontier for the country.