Iranian oil armada heads to China ahead of US sanctions

Iraq transfers ownership of 9 state oil companies to new National Oil Company – spokesman

SINGAPORE/BEIJING, Oct 18, (RTRS): An unprecedented volume of Iranian crude oil is set to arrive at China’snortheast Dalian port this month and in early November before US sanctions on Iran take effect, according to an Iranian shipping source and data on Refinitiv Eikon. A source from the National Iranian Tanker Company said the company is shipping more than 20 million barrels of oil to Dalian. “As our leaders have said it will be impossible to stop Iranf rom selling its oil. We have various ways of selling our oil and when the tankers reach Dalian, we will decide whether to sell it to other buyers or to China,” the source said, without elaborating further. So far, a total of 22 million barrels of Iranian crude oil loaded on supertankers owned by the National Iranian Tanker Co (NITC) are expected to arrive at Dalian in October and November, the data showed. Dalian typically receives between 1 million and 3 million barrels of Iranian oil each month, according to the data that dates back to January 2015. Iran, the third-largest producer in the Organization of the Petroleum Exporting Countries, is finding fewer takers for itscrude ahead of US sanctions on its oil exports that will take effect on Nov 4. The Islamic country previously stored oil at Dalian during the last round of sanctions in 2014 that was later sold to buyers in South Korea and India. Some of the biggest refineries and commercial oil storage facilities in China are located

A picture taken on Oct 18 shows a general view of foreign labourers working in the construction site of Riyadh’s metro.The kingdom of Saudi Arabia is boosting its infrastructure spending and expanding its railways, including with a $22.5 billion metro system under construction in the capital Riyadh,

as it seeks to diversify its oil-dependent economy. (AFP)

in Dalian. One of 11 Very Large Crude Carriers (VLCCs) – Dune – discharged oil into a bonded storage tank at the Xingang section of the Dalian port on Oct 8, Reuters reported last week, while a second VLCC Dino I switched off its transponder on Oct 13 near the port. Dino I reappeared earlier this week near Taiwan and has ischarged its cargo onboard. The Xingang area is home to several tank farms including commercial and strategic reserves. China National Petroleum Corp(CNPC) and Dalian Port PDA Co Ltd both operate commercial storage in the area, according to information on the companies’ websites. CNPC is not expecting any Iranian oil to arrive at Dalian, as ource familiar with the matter said, adding that buyers are unlikely to lift Iranian oil from bonded tanks in Dalian due to the US sanctions. Keeping oil in bonded storage gives the cargo’s owner the option of selling the oil into China or to other buyers in the region. NITC tankers have now switched off their tracking devices when loading or discharging oil to evade US authorities as the United States will re-impose sanctions on Iran in early November, according to Refinitiv Eikon shipping data. Three of the tankers, set to arrive in China in November, are heading to Changxing Island, the data showed. Reuters contacted NITC for comment but officials were not immediately available as it is a weekend in Iran. An official with the media department at the Dalian port could not immediately comment.

ERBIL, Iraq:

Iraqi Oil Minister Jabar al-Luaibi issued a decree transferring the ownership of nine state-owned oil companies from the oil ministry to the newly-formed National Oil Company which he also heads, a ministry spokesman said on Thursday.

Luaibi took the decision in his capacity as National Oil Company chief, not minister, according to a statement by spokesman Asim Jihad. The decision will be “followed by others within the same framework,” Jihad said.

LONDON/DUBAI:

State-owned Abu Dhabi National Oil Co (ADNOC) is looking to sell a stake in its multibilliondollar pipeline infrastructure assets, three financial sources said.

ADNOC has embarked on a major transformation drive in the past two years to make it more competitive and commercially focused like other stateowned peers, selling and listing stakes in parts of its business.

A spokesman for ADNOC said the company was exploring a number of “potential innovative transaction opportunities” to improve its asset base and capital structure. Several sources said Bank of America-Merrill Lynch was advising ADNOC on a range of options for the infrastructure assets, including a possible stock market listing.

JPMorgan is also helping with the process, two of the sources said.

Bank of America-Merrill Lynch and JPM declined to comment.

Abu Dhabi is encouraging its state companies to go public, hoping to lure foreign investors with privatisations and make the economy more competitive and less reliant on oil revenues.

But the appetite for stock market listings has been hurt by the global sell-off in equities as political and economic tensions have increased and as interest rates rise in developed countries.

Abu Dhabi sovereign wealth fund Mubadala this week postponed the listing of Spanish oil business Cepsa, which would have been the largest oil company listing in a decade, citing adverse market conditions. This follows the postponement of Saudi Aramco’s share float, expected to be worth up to $100 billion, after two years of preparations.

Although ADNOC has no plans to list the holding company, it might look at selling stakes in some of its service companies and would explore new ways to manage its assets, the company’s CEO told Reuters last year.

It did list 10 percent of its distribution arm, the largest operator of retail fuel service stations and convenience stores in the United Arab Emirates, in December 2017. Its share price is trading 18 percent below the IPO price.

Sources previously told Reuters that the company was preparing to sell a further 10 percent of the shares to help with its aim of joining the MSCI Emerging Markets Index and attract more international interest.

ADNOC has also sold a 5 percent stake in the drilling business to Baker Hughes, the world’s second-largest oil services company, for $550 million.

The company has been increasing partnerships with international oil and gas companies, including Italy’s ENI and France’s Total to expand its refining and petrochemicals operations.

ADNOC produces some 3 million barrels of oil per day, or around 3 percent of global production. It also produces more than 9.8 billion cubic feet of raw gas per day, placing it among the largest energy producers in the world.