Click on the headline (link) for the full text.
Many more articles are available through the Energy Bulletin homepage
Big oil may have to get even bigger to survive
Oliver Morgan, The Observer
The international giants are in trouble, with reserves shrinking, taxes and costs rising, and producing nations reneging on deals or nationalising their assets. The answer to their problems could be massive mergers
~~
Multinational oil companies are having a tough time. Crude prices are falling, maintaining production is a struggle, yet taxes set by the world’s resource-rich nations are rising – as are costs. Topping it all is a rising trend of energy nationalism stretching round the globe.
The problems raise several linked questions in the minds of experts: is this a taste of the future for the majors such as Exxon, Shell and BP? More provocatively, is there a future for these companies as we know them? Or will they have to change what they do dramatically – even merge, as Shell and BP are rumoured to be considering, to create super-giant companies?
(29 Oct 2006)
… and in doing so obscure the fact that their reserves are declining. -AF
BP-Shell merger back on the cards
Terry Macalister, Mail & Guardian
Shell was at the centre of buyout moves and speculation on Monday after it unveiled plans to spend C$7,7-billion (£3,7-billion) simplifying its North American business. This was seen by some as a step towards a £230-billion mega-merger with BP.
(27 Oct 2006)
Desperation may be heating this oil rumour
Nils Pratley, The Guardian
There is no evidence that talks are taking place. There is no suggestion that executives on either side are agitating for it to happen. Yet the idea that BP and Shell could merge to create the world’s largest company refuses to go away. Oppenheimer & Co, a Wall Street investment house with a reputation for being close to the pulse of the oil industry, has published a detailed analysis of a deal it thinks could be “an intelligent, strategic response to a shifting global landscape”.
The oil industry invented mergers and acquisitions, so you never say never, but desperate, rather than intelligent, is the first word to describe a BP-Shell mega-merger. It is hard to think of two large organisations in the same industry with such wildly different cultures. Years of in-fighting among executives would be virtually guaranteed.
(24 Oct 2006)
