NAJIB’S CASH COW HIT – GOVT OF THIEVES RUN DRY: PETRONAS SUFFERS ADDITIONAL US$2.9 BIL LOSS IN OVERPRICED AUSSIE PROJECT

Petronas partner in the Australian Gladstone LNG Project, Santos has announced that ” it will take a $US870 million ($A1.1 billion) non-cash, after-tax impairment on the Gladstone LNG project”.

Santos owns 30% of the project while Petronas’s share equals 27.5% and hence Petronas’ share of the write-off will also be equal approximately $US 870 Million.

However, that figure is an after tax figure, and so the before tax figure $US 2.9 Billion would be more accurate.

Petronas’ investment in the Gladstone project was over-priced from Day One, when its initial investment caused the entire Australian market for LNG assets to be pushed upwards.Again, another Wee Yaw Hin debacle.

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References
 
by Ganesh Sahathevan
 

After a six-year stint as head of Petroliam Nasional Bhd’s (Petronas) upstream business, Datuk Wee Yiaw Hin  said (in 2016) that he is “ready to take a break from the industry.”

In typical style Petronas maintains that these write-downs by its partners have nothing to do with Pertonas:In Australia 

Santos has advised of a further $US1.5 billion write-down on the value of its new GLNG gas export project in Queensland in a move that has fuelled expectations the plant will have to be run at well below full capacity for many years.
The impairment, which chairman Peter Coates said reflects “the reality of the current oil price environment”, also means Santos will almost certainly plunge deep into the red when it reports its first-half results on Friday.
The latest write-down, of about $US1.05 billion after tax, comes on top of the $565 million ) pre-tax impairment on GLNG in February.

Petronas share of the write-down equals approximately about RM 6.2 Billion .Santos owns 30% of the project while Petronas’s share equals 27.5%.The figure is based on Petronas having equal share BUT an exchange rate of 1 AUD equal MYR 3. The current exchange rate is 1 AUD equal MYR 3.42.

In Canada The impairment, which would have an effect on the profitability of the national oil company but not its cash-flow situation, is estimated based on the provisions made by one of the joint-venture (JV) partners in the LNG project. According to wire reports, Japan Petroleum Exploration Co (Japex) that has a 10% stake in the Pacific NorthWest LNG project consortium would take a loss of about C$102mil (RM349mil) in the year to end-March following Petronas’ decision to abort its Canadian LNG project.

“Based on what Japex will provide, Petronas’ portion would be about six times the amount considering its 62% stake in the consortium,” said an industry analyst.

Therefore, Petronas’s share of the write-down would be approximately, RM 2.1 Billion

In Sudan 

This statement from 2014  says much about Petronas’s ostrich like attitude attitude:

“Sudan and South Sudan have done very well despite the security issues,” Petronas executive vice-president for exploration and production Datuk Wee Yiaw Hin toldStarBiz in a recent interview.

“We must look at it as a long-term investment. Production from Sudan and South Sudan average about 220,000 bpd today.

“Despite zero production for many years, we didn’t have to make any impairments for our operations there because we have made so much money and the remaining value is huge.”

No indication has been given anywhere of what  remaining value is huge means.

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