Episode 18 - Marathon exits Libya | Mexico's Lopez Obrador threatens drastic changes to energy policy
Episode 18
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Marathon sells stake in Libya oil to Total
https://www.google.com/amp/mobile.reuters.com/article/amp/idUSKCN1GE0Y6
Total has been making more “risky” deals lately – gas deal in Iran, oil deal in Libya – these are areas with high risks. Libyan dockworkers just went on strike,
Marathon strategy in Permian M&A – consolidation of assets, swaps to make more effective use of resources. Sale to Total fits with this strategy.
Total has longer term strategy – can afford to wait it out until Libya more stable. Marathon not interested in long game in Libya.
Australia – Tesla powerwall
Nuclear power as a base load option – perhaps will become more attractive
Mexico – leading candidate in presidential elections – Obrador – opposes privatization of Mexican oil industry that current President Pena Nieto began.
https://www.wsj.com/articles/top-candidate-andres-manuel-lopez-obrador-plots-big-shake-up-for-mexicos-oil-industry-1520852400
Elections will be in July. Uncertainty poses threat to ongoing privatization because companies are hesitant to jump into Mexico energy scene if their investments could be nationalized or nullified in the next election. Won’t want to put in millions of dollars and 5+ years of work to develop new oil resources in Mexico.
Mexican refining situation is deteriorating but Obrador wants to focus on improving it. Problem is that refining margins are small.
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