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Thursday, 14 June 2012

UPDATE 1-Egypt gets $3.7 bln financing for refinery project | Reuters

Investors in an Egyptian petroleum refinery project, led by Citadel Capital and Qatar Petroleum, have secured $3.7 billion in financing for the facility, the project operator said on Thursday.

The financing, put together by private equity firm Citadel, includes a $1.1 billion equity investment and is backed by a $2.6 billion debt package, Egypt Refining Company (ERC) said in a statement. Project partners include the Egyptian government.

The ERC project is to produce more than 4.1 million tonnes of refined products and oil derivatives annually, including more than 2.3 million tonnes of Euro V diesel per year. This is expected to cut Egyptian diesel imports by up to 50 percent.

Dubai's debt clouds disperse | Reuters

Three-year old debt clouds hanging over Dubai dispersed this week as two of the most challenging bond maturities at its government-related entities were tackled, increasing confidence in the market and sparking renewed buying in the emirate's secondary credit.

DIFC Investments, the company that runs Dubai's iconic international financial centre, repaid in full a USD1.25bn sukuk which matured on June 13, using funds raised through a partially government-guaranteed Islamic loan and a programme of asset sales.

Its repayment followed Jebel Ali Free Zone, which owns and operates a strategically vital trading hub, going a long way towards refinancing a USD2.04bn-equivalent dirham sukuk due in November by issuing a highly successful new USD650m, seven-year sukuk on Tuesday 12. The bond is part of a package, including a USD1.2bn loan that is already in place, to help cover the redemption.

MENA stock markets close - June 14, 2012

 ExchangeStatus IndexChange  
 TASI (Saudi Stock Market)
 DFM (Dubai Financial Market)
 ADX (Abudhabi Securities Exchange)
 KSE (Kuwait Stock Exchange)
 BSE (Bahrain Stock Exchange)
 MSM (Muscat Securities Market)
 QE (Qatar Exchange)
 LSE (Beirut Stock Exchange)
 EGX 30 (Egypt Exchange)
 ASE (Amman Stock Exchange)
 TUNINDEX (Tunisia Stock Exchange)
 CB (Casablanca Stock Exchange)
 PSE (Palestine Securities Exchange)

UPDATE 2-A.Dhabi fund books $3.4 bln loss on Daimler, UniCredit | Reuters

Abu Dhabi's state-owned fund International Petroleum Investment Co posted a $3.42 billion loss on stakes held by its unit in automaker Daimler and Italian bank UniCredit in 2011, all but wiping out its profit.

IPIC, which reported a 97 percent drop in 2011 net profit on Wednesday due to "both market and economic volatility", released full financial results on Thursday detailing the loss on the two European groups held by its unit Aabar Investments.

The fair value loss on its 9.1 percent stake in Daimler stood at $2.25 billion in 2011 versus a $1.3 billion gain in 2010, IPIC report said. Its UniCredit fair value loss was $1.17 billion versus a $239 million loss in the previous year. It holds a 4.99 percent stake in the Italian bank.

Keeping OPEC ceiling won't stop price slide: Algeria | Reuters

Keeping OPEC's oil output limits unchanged will not be enough to halt the fall in the price of crude, Algerian Energy Minister Youcef Yousfi was quoted as saying on Thursday.

"There is at the moment an unjustified rise in the organisation's (OPEC's) production," Yousfi was quoted as saying by Algeria's APS state news agency.

"With this over-production, there is a risk that prices will fall, uncontrolled, to levels from which it will be very difficult subsequently to bring them back. Maintaining the ceiling adopted (by OPEC) last December will not be sufficient."

MIDEAST STOCKS-Dubai leads declines as wary traders cut mkt exposure | Reuters

Dubai's benchmark fell to a one-week low and most Gulf Arab bourses also declined on Thursday, with investors reluctant to hold big positions ahead of a long weekend that includes elections in Egypt and Greece.

Egypt will return to the polls on June 16-17 to choose a new president and investors hope a peaceful vote will boost Cairo stocks next week, while a leftist victory in Greece's election could ultimately force the country out of the euro.

"We're being held hostage to international market performance - it's one day up and then one day down, which is confusing everyone," said Marwan Shurrab, vice-president and chief trader at Gulfmena Alternative Investments.

Kuwait’s Al-Mazaya Wants Reduced Exposure in Dubai, CEO Says - Bloomberg

Al-Mazaya Holding Co. (MAZAYA), a Kuwait- based property developer, plans to reduce its business in Dubai, Chief Executive Officer Nayef Mohammed Al-Awadi said, citing difficulties.
“We want to reduce our exposure in Dubai because of difficulties with existing infrastructure and master developers,” Al-Awadi said in an interview today in Kuwait.
Construction companies in the United Arab Emirates are searching for work in other markets after $964 billion in projects were halted or canceled in the country as of last November, Citigroup said in a Jan. 6 report.

Kuwait's NBK offers $2.1 bln for full control of Boubyan | Reuters

National Bank of Kuwait (NBK) is offering 581 million dinars ($2.07 billion) for the remaining stake in Boubyan Bank that it does not already own, the country's largest lender said on Thursday.

NBK, which currently owns 47.29 percent stake in the Islamic lender, will offer 630 fils per share for the stake, said in a bourse statement. Boubyan shares closed at 600 fils on the Kuwait stock exchange on Wednesday.

NBK has been building its Islamic banking business. In April 2011, it boosted its position in sharia-compliant Boubyan which competes with Kuwait Finance House and Kuwait International Bank.

Persian Gulf Stocks: Etisalat in Abu Dhabi and Industries Qatar - Bloomberg

Dubai’s benchmark DFM General Index (DFMGI) fell 1 percent to 1,463.73 at the close in the emirate, the lowest since June 7. The gauge was little changed this week. Qatar’s QE Index (DSM) slipped 0.1 percent as Saudi Arabia’s market was closed for the weekend.

Qatar Financial Markets Authority issues 4 new regulations on financial services - Qatar - Zawya

The Qatar Financial Markets Authority strengthened its legislative infrastructure by issuing new regulations on financial services. The new laws cover four activities, including liquidity providers, lending and borrowing of securities, rules of guaranteed entry to market's standards and rules for listing units of investment funds.

Issuing these regulations is consistent with the Authority's constant endeavour to modernize its legal structure by putting into place procedures that ensure healthy trading transactions and help reinforce the QFMA 's supervisory role in the capital market. The authority is keen to support the market through modern internationally applicable standards to ensure better stability and balance, encourage investment, and provide more attractive opportunities in the market.

Jafz issues $650m sukuk due in 2019 - Emirates 24/7

Jebel Ali Free Zone FZE (Jafz) announced it has successfully priced the issuance of $650m Sukuk Certificates due 2019, marking the company's first US dollar-denominated issuance and its first transaction in the international debt capital markets since 2007.

The certificates pay a profit rate to investors of 7 per cent per annum. The proceeds of the sukuk will be used to partly refinance Jafz's outstanding Dh7.5bn sukuk due November 2012, ahead of the stated maturity. Jafz will also contribute proceeds of Dh4.4bn bank facility and its own cash sources towards the redemption.

The transaction saw strong demand from regional and international investors, with the order book 3.1 times subscribed. The order book was well-diversified, both in terms of investor type and geography. European investors accounted for 26 per cent of the allocation, Asian accounts 7 per cent, US Offshore investors 2 per cent and Middle Eastern investors took up the balance of 65 per cent.

Oil wealth no cure for Venezuela’s fiscal woes | beyondbrics

So BP is the latest to recognise officially that Venezuela has the largest proven oil reserves in the world, something that Hugo Ch├ívez has been merrily pointing out for years.

In reality, this has not passed oil companies by – they have been jockeying to get a piece of the action for some time, with the exception of a few (like Exxon Mobil and Conoco Philips) who don’t like Chavez’s way of doing business.

Only on Wednesday, China National Petroleum Corp’s vice-president assured that the company plans to bump up production in Venezuela to 800,000 barrels per day (bpd) of oil by 2017, four times the 200,000 bpd it says it is pumping at the moment.

What's the Deal With Oil Prices?

What the heck is happening with oil prices?

West Texas Intermediate (WTI) oil is selling in the $82 range per barrel - way down from recent postings near $110. Overseas, the Brent price for oil is about $97 per barrel - way down from $125 per barrel as recently as early May.

What's going on? How low can oil prices go? Are we looking at the beginning of a major price slide? Is the oil and oil service investment space under a pricing assault?

I doubt it. Here's why: 40% of global oil production comes from places where the national governments cannot afford oil prices to go much lower than they are currently.

The nearby chart tells the tale.

Venezuela Overtakes Saudis to Hold World's Biggest Oil Reserves

Venezuela surpassed Saudi Arabia to become the world's largest holder of proven oil reserves, a resource that President Hugo Chavez promises to tap if he gets re-elected in October.

The South American country's deposits were at 296.5 billion barrels at the end of last year, data from BP Plc show. Saudi Arabia held 265.4 billion barrels, BP said yesterday in its annual Statistical Review of World Energy. The 2010 estimate for Venezuela increased from 211.2 billion in the previous report.

Chavez wants to more than double the country's oil- production capacity to 6 million barrels a day by 2019, according to a government plan released June 12. The world's biggest oil-exporting nations faced a 15 percent slump in crude prices last month, the biggest decline since December 2008, on speculation Europe's debt crisis would derail the global economic recovery.

Kingdom is world’s 8th high growth economy | ArabNews

Saudi Arabia’s winning of 8th position among the world’s 10 high growth economies of 2012 listed by the International Monetary Fund reflects its economic strength and stability, said Economy and Planning Minister Muhammad Al-Jasser yesterday.
“The IMF has predicted that the actual growth rate of Saudi Arabia’s gross domestic product would reach six percent in 2012. This is a new international certificate that reaffirms the Kingdom’s economic stability and effectiveness of its economic policies,” he said.
Al-Jasser said the buoyant IMF economic outlook about Saudi Arabia is significant as it comes at a time when most countries in the world are facing economic downturn as a result of global recession and euro zone financial collapse.