Page 13 - Euroil Week 01 2020

EurOil POLICY EurOil
Unions strike at French oil refineries
FRANCE
Refineries are continuing production and filling stations remain well stocked.
FRENCH unions launched a four-day strike at the country’s oil refineries on January 7, as part of a wider protest against the government’s pension reform plans. Protestors also blockaded some plants in an effort to prevent fuel supplies from reaching filling stations.
Ahead of the industrial action, France’s Gen- eral Confederation of Labour (GCL) claimed seven of France’s eight refineries would close down completely, depriving the country of most of its supplies of motor fuel, as well as kerosene used by aeroplanes.
“There will be disturbances to fuel supply. Our goal is not to make motorists’ lives miser- able. We want to show that workers are united against this reform,” a CGT union official told Reuters.
By most accounts, however, the strike looks likely to cause only limited disruption.
French oil major Total, the country’s largest refiner by capacity, has said it is fully prepared for the strike, noting on January 7 that less than 5% of staff had downed tools. Its four main plants in Gonfreville (253,000 barrels per day), Donges (220,000 bpd), Feyzin (117,000 bpd) and
Grandpuits (102,000 bpd), are still in operation, as is its smaller-scale biofuel plant in La Mede. They are currently holding their output back until union picketing ends.
Only 26 of Total’s 3,500 filling stations had run out of fuel as of January 7, according to the company. France has a total of 6,000 filling stations.
ExxonMobil, which runs the 240,000 bpd Port Jerome and the 140,000 bpd Fos-sur-Mer refineries, has said only a limited number of its workers have joined the protests. Product load- ing has been disrupted at the Fos-sur-Mer facil- ity, but refining continues as usual. Operations at the Port Jerome facility are unaffected.
France’s final refinery is located close to Mar- seille and is operated by PetroIneos, a joint ven- ture between PetroChina and the UK’s Ineos. It can process up to 210,000 bpd of crude.
The impact of the strikes will be further undermined by the fact that around half of its fuel is typically imported. France also has the equivalent of three months of fuel in storage – half in the form of unprocessed crude and half as refined fuel. ™
Algerian gov wants a closer look at Energean/Edison deal
ALGERIA
The disclosure could indicate Energean will have to revise its plan.
THE Algerian government has asked Italy’s Edison to discuss its upcoming acquisition by UK-listed Energean.
In a statement dated December 23, Energean reported that Algeria had invited the Italian firm to discuss its sales and purchase agreement (SPA) with Sonatrach, the national oil company (NOC), in a letter received earlier in the year. It did not reveal any specific details of the letter, but it did point out that the transaction could not go forward without the approval of the countries where Edison is operating.
“The acquisition remains subject to relevant government approvals, including the consent of the relevant Algerian authorities in respect of Edison assets located in Algeria,” it said.
This disclosure may indicate that Energean will have to revise its plan to acquire Edison by excluding those assets from the transaction. There is precedent for such a move, given that Sonatrach decided earlier in 2019 to exercise its right to pre-empt a deal between Total (France) and Occidental Petroleum (US) for Hassi
Berkine and other Algerian assets previously owned by Anadarko Petroleum (US).
Currently Edison has a minority 11% stake in Reggane Nord, a natural gas field in Algeria. The remaining equity in the site is split between Sonatrach, the operator, with 49%; Repsol (Spain), with 29.25%, and Wintershall Dea (Ger- many), with 19.5%.
In the meantime, the UK-listed company is continuing talks with Edison to determine whether the parties must amend the SPA to exclude the latter’s Algerian assets. “Energean and Edison are also working to agree an appro- priate settlement on the total transaction consid- eration to take into account any exclusion of the Algerian asset from the transaction perimeter,” it said.
Talks with Algeria are not likely to affect the other assets in Edison’s upstream portfolio, Ener- gean added. France, Greece, Norway and the UK have all given their green light to the acquisition, it explained, and Egypt and Italy are likely to do the same in the near future. ™
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