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Cenovus snares Li Ka-shing’s Husky Energy in $7.8bn deal – Financial Times

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Cenovus Energy is to buy rival Canadian oil producer Husky Energy, controlled by Hong Kong billionaire Li Ka-shing, in a C$10.2bn ($7.8bn) deal as the wave of consolidation sweeping North America’s battered oil and gas sector gathers speed.

The new company will be worth C$23.6bn, Cenovus said, making it Canada’s third-largest oil and gas producer with an output of 750,000 barrels a day concentrated in the bitumen-rich oil sands of northern Alberta, the biggest single source of US crude imports.

The transaction is the latest in a string of North American oil mergers as operators seek to consolidate and cut costs. The largest came last week when ConocoPhillips agreed to buy Concho Resources in a deal worth $9.7bn, marking another big bet on the future of US shale.

Other recent deals include the $7.6bn takeover of US shale group Parsley Energy by Pioneer Natural Resources, Chevron’s $13bn plan to buy Noble Energy and Devon Energy’s $12bn deal to combine with rival WPX Energy.

The plummeting oil price had caused shares in Cenovus to fall by more than 60 per cent since the start of January, and Husky’s by almost 70 per cent.

The deal was conceived as a nil-premium merger, but due to the divergence in share prices, Cenovus has agreed to pay a 21 per cent premium, or 23 per cent including warrants, to Husky shareholders. The transaction values Husky’s shares at about $3.8bn, or $10.2bn including debt.

“We will be a leaner, stronger and more integrated company, exceptionally well-suited to weather the current environment and be a strong Canadian energy leader in the years ahead,” said Alex Pourbaix, Cenovus’s chief executive.

The new company will be 61 per cent owned by Cenovus shareholders, with the reminder held by Husky’s investors. Two entities controlled by Mr Li, which own about 70 per cent of Husky at present, will emerge with more than 27 per cent of the new company’s common stock.

Mark Oberstoetter, head of North America upstream research at Wood Mackenzie, said the takeover meant Cenovus would now have enough refining capacity to handle the bulk of its own production, which could add some “natural hedging back into the portfolio”.

After the withdrawal of several international oil companies from the Alberta oil sands — where the high cost of producing bitumen, constant environmental opposition, and slow progress in building new pipeline infrastructure have deterred investors — the Cenovus deal points to the sector’s further consolidation in the hands of local companies.

Future dealmaking could see remaining oil sands interests held by Total, Shell, BP, and Chevron — which no longer consider the region strategic — targeted for acquisition by Canadian operators, Mr Oberstoetter added. “Calgary used to be an international hub, but we’ve lost that,” he said.

Both Cenovus and Husky were among oil-sands operators forced to shut some production this year as prices fell. The Alberta government, which offered to collaborate with the Opec cartel in its supply cuts earlier this year, has used a programme of so-called curtailments to restrict supply from operators, including Cenovus and Husky, to prevent production overwhelming local infrastructure.

Canada’s production of bitumen — ultra heavy oil that must be upgraded before refining into fuels — has attracted environmental opposition because of its carbon intensity and its vast ecological footprint in northern Alberta.

Insufficient pipeline capacity to ship growing volumes of oil-sands production to markets beyond North America has periodically forced deep discounts on Canadian exports. The low quality of Alberta’s oil also makes it cheaper. While US oil has traded at about $40 a barrel in recent weeks, the benchmark for Canadian oil has been priced at about $30 a barrel.

The companies said annual synergies created by the deal would amount to $1.2bn, largely achieved within the first year. Free cash flow would be achieved at a price of $36 for a barrel of West Texas Intermediate in 2021.

A new 12-person board will comprise eight directors from Cenovus and the remainder from Husky.

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Britain secures additional 2 million doses of Moderna’s COVID-19 vaccine; appoints vaccines minister – The Globe and Mail

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Protesters march through central London as they take part in an anti-lockdown protest against government restrictions designed to control or mitigate the spread of the novel coronavirus, including the wearing of masks and lockdowns, in London on November 28, 2020.

TOLGA AKMEN/AFP/Getty Images

Britain has secured an additional two million doses of Moderna Inc’s COVID-19 vaccine candidate, the government said in a statement on Sunday.

Following the latest deal, Britain has access to enough doses of Moderna’s vaccine candidate for around 3.5 million people. Overall, it has access to 357 million doses of vaccines from 7 different developers, according to the statement.

“With a wide range of vaccine candidates in our portfolio, we stand ready to deploy a vaccine should they receive approval from our medicines regulator, starting with those who will benefit most,” Britain’s health minister, Matt Hancock, said in the statement.

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On Saturday, the British government appointed a vaccines minister as it prepares to inoculate millions of people against the coronavirus, potentially starting within days.

Prime Minister Boris Johnson said Conservative lawmaker Nadhim Zahawi will oversee the country’s biggest vaccine program in decades.

The U.K. medicines regulator is currently assessing two vaccines — one developed by Pfizer and BioNTech, the other by Oxford University and AstraZeneca — to see if they are safe and effective. The Guardian newspaper reported that hospitals have been told they could receive the first doses of the Pfizer shot the week of Dec. 7, if it receives approval.

The U.K. says frontline health care workers and nursing home residents will be the first to be vaccinated, followed by older people, starting with those over age 80.

Britain has ordered 40 million doses of the Pfizer/BioNTech vaccine, enough for 20 million people, and 100 million doses of the Oxford/AstraZeneca vaccine.

In all, the U.K. government has agreed to purchase up to 355 million doses of vaccine from seven different producers, as it prepares to vaccinate as many of the country’s 67 million people as possible.

Decisions about which, if any, vaccines to authorize will be made by the independent Medicines and Healthcare Products Regulatory Agency.

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Pfizer and BioNTech say their vaccine is 95% effective, according to preliminary data. It must be stored at ultra-cold temperatures of around minus 70 degrees Celsius (minus 94 Fahrenheit).

The Oxford-AstraZeneca vaccine can be stored at conventional refrigerator temperatures, and is also cheaper than its main rivals. But some scientists have questioned gaps in its reported results.

Oxford and AstraZeneca reported this week that their vaccine appeared to be 62% effective in people who received two doses, and 90% effective when volunteers were given a half dose followed by a full dose. They said the half dose was administered because of a manufacturing error, and they plan a new clinical trial to investigate the most effective dosing regimen.

The British government hopes a combination of vaccines and mass testing will end the need for restrictions on business and everyday life it imposed to curb the spread of the coronavirus. Britain has had Europe’s deadliest COVID-19 outbreak, with more than 57,000 confirmed virus-related deaths.

The prime minister said this week that officials hope to inoculate “the vast majority of the people who need the most protection by Easter.” But he warned that “we must first navigate a hard winter” of restrictions.

A four-week national lockdown in England is due to end Wednesday, and will be replaced by three-tiered system of regional measures that restrict business activity, travel and socializing. The vast majority of the country is being put into the upper two tiers.

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The restrictions have sparked protests, with police arresting scores of people at an anti-lockdown demonstration in London on Saturday.

Several bottles and smoke bombs were thrown as anti-mask and anti-vaccine demonstrators scuffled with officers in the city’s West End shopping district. The Metropolitan Police force said 155 people were arrested.

Johnson also faces opposition to the measures from dozens of his own Conservative Party’s lawmakers, who say the economic damage outweighs the public health benefits.

Bur Cabinet minister Michael Gove said the restrictions were “grimly” necessary to avoid the health system being overwhelmed this winter.

Writing in The Times of London, Gove said there are currently 16,000 coronavirus patients in British hospitals, not far below the April peak of 20,000. A rise in infections would mean coronavirus patients would “displace all but emergency cases. And then even those.,” he said.

“If, however, we can keep the level of infection stable or, even better, falling, and hold out through January and February, then we can be confident that vaccination will pull the plug on the problem,” Gove wrote.

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NIH Director: Politics Have 'Nothing To Do' with COVID-19 Vaccine Approval | MSNBC – MSNBC

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  1. NIH Director: Politics Have ‘Nothing To Do’ with COVID-19 Vaccine Approval | MSNBC  MSNBC
  2. Canada ‘not at the back of the line’ for COVID-19 vaccine, Moderna chairman says  CBC.ca
  3. Coronavirus: Support for mandatory COVID-19 vaccination is falling in Canada says Ipsos poll  Global News
  4. UK could launch coronavirus vaccination effort as soon as Dec. 7  CP24 Toronto’s Breaking News
  5. Be patient and stay safe. Coronavirus vaccines are on the way.  The Dallas Morning News
  6. View Full coverage on Google News



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Moderna chairman says Canada near front of line for 20 million COVID-19 vaccine doses – CP24 Toronto's Breaking News

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Mike Blanchfield, The Canadian Press


Published Sunday, November 29, 2020 1:52PM EST


Last Updated Sunday, November 29, 2020 3:00PM EST

OTTAWA – Conservative Leader Erin O’Toole accused the Liberal government Sunday of putting too much emphasis on partnering with a Chinese company for a COVID-19 vaccine in what turned out to be a failed deal.

O’Toole said the Trudeau government only turned its attention to pre-ordering tens of millions of vaccine doses from companies such as Pfizer and Moderna in August when its collaboration between the National Research Council and Chinese vaccine-maker CanSino finally collapsed after months of delays.

The Council had issued CanSino a licence to use a Canadian biological product as part of a COVID-19 vaccine. CanSino was supposed to provide samples of the vaccine for clinical trials at the Canadian Centre for Vaccinology at Dalhousie University, but the Chinese government blocked the shipments.

“I would not have put all our eggs in the basket of China,” O’Toole said at a morning news conference.

“If you look at the timeline, that’s when Canada started getting serious with Pfizer, Moderna, the other options,” he added, saying he was concerned that “the Trudeau government was willing to almost double down on partnering with China” earlier in the pandemic.

The government announced its major vaccine purchases in August after it confirmed the CanSino partnership had fallen through. At the time, it said its decision had come after careful consultations with its vaccine task force of health experts.

The CanSino partnership with Dalhousie predated the deep freeze in Canada-China relations that occurred after the People’s Republic imprisoned two Canadian men, Michael Kovrig and Michael Spavor, in apparent retaliation for the RCMP’s arrest of Chinese high-tech executive Meng Wanzhou nearly two years ago on an American extradition warrant.

This past week, Prime Minister Justin Trudeau created a firestorm when he said Canadians will have to wait a bit to get vaccinated for COVID-19 because the first doses off the production lines will be used in the countries where they are made.

As questions grew about the CanSino deal, Trudeau continued to defend his government’s vaccine procurement policy, which he says has secured multiple options for the country. Trudeau also appointed a Canadian Forces general to lead the logistics of an eventual vaccine rollout with the Public Health Agency of Canada.

The chairman of American vaccine maker Moderna told the CBC on Sunday that Canada is near the front of the line to receive 20 million doses of the COVID-19 vaccine it pre-ordered.

Noubar Afeyan was asked on CBC’s Rosemary Barton Live whether the fact that Canada committed to pre-purchase its doses before other jurisdictions means it will get its supply first. Afeyan confirmed that was the case.

“The people who are willing to move early on with even less proof of the efficacy have assured the amount of supply they were willing to sign up to,” he said.

O’Toole said with Finance Minister Chrystia Freeland poised to deliver the government’s long-awaited fiscal update on Monday, the Liberals need to do two things to spur economic recovery: offer a better plan on how it will rollout vaccines for Canadians and step up the distribution of rapid tests.

“There can’t be a full economy, a growing economy, people working, people being productive without the tools to keep that happening in a pandemic. Those two tools are rapid tests, and a vaccine.”

Freeland’s fall economic statement is expected to give a full accounting of the government’s record spending on programs to combat the pandemic. In July, the deficit was forecast to be at a record $343.2 billion but some estimates say it could easily top $400 billion.

The government could announce new spending such as taking steps towards a national child-care system, and relief for battered industries such as travel and restaurants that will face an uphill struggle to recover from the pandemic.

NDP finance critic Peter Julien sent Freeland a three-page letter urging her to take action on a variety of fronts to help struggling Canadian families during the pandemic.

They included taking concrete action on establishing a national pharmacare plan to help Canadians pay for soaring prescription drug costs, and establish a national day-care strategy to help women who have been disproportionately hindered by the pandemic. Julien also urged Freeland to help Indigenous communities and abandon the government’s plans to pay for the Trans-Mountain Pipeline and ramp up its fight against climate change.

Green party Leader Annamie Paul called on Freeland to deliver “a positive vision for a green recovery” to accelerate Canada’s transition to a carbon-neutral economy.

“We are optimistic that a vaccine for COVID-19 will be widely available next year and so we must be prepared for what comes next,” Paul said in a statement.

This report by The Canadian Press was first published Nov. 29, 2020.

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