March 23, 2021

Saudi Aramco's debt-to-equity ratio more clients' car exhausts, it said on Monday. than doubles in 2020 BP includes emissions from the combustion of its Saudi oil giant Aramco's debt-to-equity ratio products when its customers, for example motorists, more than doubled to 55% in 2020 from a year use them - also known as Scope 3 emissions - but it before, it said in a report, after the group kept a excludes gases from oil products BP sells to pledge to deliver a $75 billion dividend to support customers but which it bought from other producers. state coffers despite a slide in profits. In contrast, BP's rival emitted 1.38 Net debt rose to 605.9 billion riyals ($161.6 billion tonnes of planet-warming gases from the billion) last year from 270.2 billion riyals in 2019, combustion of fuels it produces itself in addition to the results showed. the oil products it sells but which are produced by The world's largest oil exporter said on Sunday other companies. net profit fell 44.4% to 183.8 billion riyals for the BP runs around 20,000 retail fuel stations and its year ended Dec. 31 as the COVID-19 pandemic refined fuel sales fell over 11% to 5.3 million barrels depressed global crude demand. per day last year as the coronavirus pandemic However it maintained its pledge to declare a dampened demand. Shell owns 46,000 fuel retail $75 billion dividend for 2020, most of which goes stations, the world's biggest such portfolio. to the Saudi government. European oil majors are planning to shift away from Aramco made its international bond market debut oil and gas to low-carbon energy, power trading and in 2019 ahead of its listing that year in a record retail in order to reduce to $29.4 billion share sale. Last year, as low oil net zero by mid-century, including the use of offsets prices hurt its balance sheet, it raised a $10 for residual emissions. billion loan and $8 billion in bonds. HSBC said last month that Aramco's prospects INSIGHT-How a Burmese immigrant profited by look more positive and promising for 2021, flipping cheap oil leases from Trump auctions hinting at declining net debt and a possible A Myanmar-born U.S. perfume entrepreneur became dividend hike. a curiosity last year when she became the nation’s But a recent request sent to banks to extend by a top buyer of oil-and-gas leases at the Trump year the $10 billion debt facility raised in May last administration's federal auctions, despite having no year suggests rebounding crude prices are not apparent energy background. pushing the oil giant to reduce debt for the time Since July, Levi Sap Nei Thang has spent about $3.7 being. million on nearly 300 government leases covering Aramco is likely to "do the heavy lifting" to boost 133,000 acres in 12 states. She told Reuters at the state coffers and support mega-projects time that she was keen to produce oil on the parcels. spearheaded by the kingdom's state investor A Reuters examination of her dealings reveals she Public Investment Fund, Bank of America said in pursued a different strategy: selling the leases to a note earlier this year. other Burmese immigrants at inflated prices after The government still owns a 98.2% stake in the billing them as great investments on social media, firm and while it is diversifying its revenues away according to interviews with seven buyers and others from crude, oil revenues still accounted for more familiar with her business, along with sales than half the kingdom's income last year. agreements and leasing documents they provided. In its financial results report Aramco said Reuters confirmed four cases in which Thang sold payments to the government last year, including one or more drilling leases to Burmese immigrants dividends, royalties and income taxes, totalled for prices ranging from one-and-a-half to 13 times around 412 billion riyals, about 30% less than in what she paid. Thang made nearly $335,000 in the 2019. That was in line with Saudi estimates in cases reviewed by Reuters, buying the leases for December. about $215,000 and selling them almost immediately for more than $550,000. BP reports 10% drop in overall emissions in Three of Thang’s buyers told Reuters they had met 2020 many others who described themselves as buyers of BP Plc's greenhouse gas emissions dropped her leases, but Reuters could not determine the full 10% to around 374 million tonnes of carbon scope of Thang’s lease sales, which are private dioxide equivalent in 2020 from its oil fields to its transactions. In October, Thang invited dozens of March 23, 2021 (continued) buyers to Wyoming to meet her and tour their on federal lands. The problem: Minimum bid parcels, according to a buyer who attended. Photos requirements are $2 an acre, a level that has not and videos posted on her Facebook page show her been lifted in decades, making it easy for with groups of smiling people in windy, cold speculators with no intention to drill to secure weather. Thang told the buyers they were more like acreage at deflated values in times of low demand, her “friends, siblings and families,” one video then resell at a profit. shows. Thang purchased about a quarter of all the federal Federal and state records show Thang has not acreage sold between August 2020 and January transferred ownership of the drilling rights to the 2021, according to government data. four buyers who told Reuters they purchase leases Critics of the low bid requirements say that raising from her. Thang’s company is still listed as the them would deter speculators and raise more owner of those parcels in government records. Of revenue for public coffers. the nearly 300 leases Thang won at state and "They are getting like a bargain-basement IPO on federal auctions, only two have been reassigned, our natural resources," said U.S. Representative both to the same new owner, according to a Katie Porter, a Democrat from California, the new Reuters review of state and federal lease registries. chair of the House Natural Resources In order to transfer ownership of a lease, both buyer Subcommittee on Oversight and Investigations. and seller must submit a signed form to the state or Porter has submitted a bill to raise minimum bids to federal land office. Reuters could not ascertain why $5 per acre. Thang’s company continued to be listed as the The Trump administration sought to maximize owner of parcels that buyers said they had bought domestic oil-and-gas production by offering as much from her and paid for. federal land as possible - more than 26 million acres In the biggest sale confirmed by Reuters, the owner over four years. But due to low demand for leases, of a sushi business in Texas, Tha Cin, gave Thang driven by low oil prices, only about a quarter of the $510,000 in multiple payments last year for two acreage sold, driving lease prices to rock bottom. leases in New that Thang had bought that The U.S. Department of the Interior, which manages summer for about $200,000, according to Cin and the lease auctions, declined to comment on the risks her lawyer, copies of the sale agreements, and of speculation in the leasing program. lease records. The oil-and-gas industry rejects the argument that Despite Cin’s purchase agreements with Thang, the leasing program’s low-minimum bids lure dated in early September, federal and state leasing speculators, and believes raising minimum bids documents still showed Thang’s company as the would deter investment from oil firms. One trade owner of the parcels as of Friday. That surprised group said the Biden administration should simply Cin’s lawyer, Jeff Vaughan. revoke Thang’s leases because she is not a U.S. Cin said she was moved by Thang’s spiritual citizen. references in Facebook videos. “All our money was “It’s a simple fix to a rather bizarre case that says taken by the person who we believed and trusted, nothing about the broader leasing program,” said who talked about God all the time,” she said. Kathleen Sgamma, president of the Western Energy Three other buyers told Reuters that they have Alliance. asked Thang to return their money. One said she Thang, a permanent U.S. resident, used a U.S.- got her money back and another said he got only a registered company to buy her leases, which is portion back. permitted under the federal leasing program. Thang and her lawyer did not answer Reuters’ President Joe Biden last month suspended new questions about her oil-and-gas lease dealings. But leasing auctions pending a comprehensive review of Thang on March 8 issued a statement on her the federal drilling program. The review will weigh website saying: “Everyone who purchased from me the environmental costs of developing fossil fuels did so by their own will. I have the right to sell to against the public revenue it provides. who I want to, when I want to, and for what price I Spokespeople for Trump and for Biden’s White set.” House did not respond to requests for comment. Thang’s lease-flipping illustrates vulnerabilities in the U.S. government's oil-and-gas leasing program, ‘I WILL BECOME RICH LIKE HER’ which generates public revenue from development Thang immigrated to the United States 20 years

2 March 23, 2021 continued) ago. She has since become a minor celebrity in the millionaires.” Burmese immigrant community, describing herself Sang said that he agreed to buy a second lease on Facebook as a devout Christian, a successful from Thang during the tour, this one on 80 acres of businesswoman, and a philanthropist. Her followers land in his home state of Michigan. He said Thang include many refugees from Myanmar fleeing described it as "a present" because it would cost military abuses against ethnic minority groups. The him just $5,000. Thang had bought the lease at a United States has taken in about 175,000 Burmese September federal auction for $450 - the minimum refugees since 2007, U.S. government data shows. price of $2 an acre plus transaction fees, records Thang started snapping up cheap oil-and-gas show. leases last summer and marketing them to the more Sang said he got all but $100 of his $5,000 back for than 600,000 followers of her Facebook page. In the Michigan lease after confronting Thang. But videos, Thang told her followers that they could Sang has not been able to get his money back for make enough money with oil leases to abandon the Wyoming leases for reasons he said Thang has making sushi, a common profession among not made clear. Burmese immigrants. Texas sushi entrepreneur Cin was among Thang’s OPEC+ compliance with oil cuts rises to 113% in first buyers. In June, she contacted Thang, who February, sources say convinced Cin to invest $510,000 - her life savings - OPEC+ compliance with oil production cuts in in New Mexico acreage, she said. February rose to 113%, two OPEC+ sources from “She also told me to quit my job, my sushi business, the producer group told Reuters on Monday. and come live in New Mexico because I will be The figure compares with a January compliance making between at least 3,000 to 4,000 barrels per figure of 103%. day,” said Cin. Compliance from members of the Organization of She said Thang told her she would “become rich the Exporting Countries reached 124%, a like her, travel around the world, do missions figure which includes the additional voluntary cut together.” from Saudi Arabia, said one of the sources. Compliance from non-OPEC members in the ‘SOMETHING WAS WRONG’ alliance reached 94%, the source added. Cin grew suspicious after visiting the acreage in September, guided by a relative of Thang’s, who India's crude imports fall in February as demand couldn’t answer most of her questions. “I felt like slows, new virus wave looms something was wrong,” Cin said. India's crude oil imports fell by the most in four She found out later that Thang had acquired the months in February, government data showed on acreage for just $200,000. Monday, as demand slowed due to rising fuel prices Two Burmese immigrants living in Michigan - and as the country faces a resurgence in COVID-19 Andrew Sang and an acquaintance who asked not cases and potentially fresh restrictions. to be named - told Reuters they had a similar India's crude oil imports in February fell 18.3% from experience. a year earlier to 15.24 million tonnes, the biggest The pair paid Thang about $47,000 in July for two year-on-year fall since October 2020, data from the Wyoming parcels after seeing her Facebook posts, Petroleum Planning and Analysis Cell (PPAC) they said. Thang had bought the leases that same showed. month for less than $12,000, according to Wyoming "India is depending on its reserves for the time being state records. and waiting for rally in oil prices to cool off," said At the time, abysmal market conditions were Amit Sajeja, a vice president at Motilal Oswal. causing established drillers to flee Wyoming. The "However, if the decline continues in the next few state lease registry still listed Thang’s company as months, it would become a concern indicating an the owner of the leases as of Friday. economic slowdown." During the Wyoming meetings with buyers, Thang India's fuel consumption also fell for a second said that major oil companies had agreed to meet straight month in February to its lowest since the group in 2021 to discuss drilling their leases, September, while crude oil processing retreated said Sang, who attended the tour. Thang, he said, from levels seen in January, which were the highest made it seem like “everyone would become in nearly one year.

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The world's third-biggest importer and consumer of would pay the most if policies were changed to oil reported its most COVID-19 cases and deaths in account for the costs. months on Monday and authorities reintroduced Kotchen launched the research as policymakers some curbs to slow the spread of the virus, were considering new subsidies for fossil fuel especially in the western state of Maharashtra. companies to help them recover from anemic Meanwhile, Indian state refiners are planning to cut demand due to the coronavirus pandemic. oil imports from Saudi Arabia by about a quarter in President Joe Biden wants to end fossil fuel May, sources familiar with the discussions told subsidies, but that could be difficult given the Reuters last week. Democrats have the slimmest majority possible in The United States overtook Saudi Arabia as India's the Senate, and some Democrats come from states second biggest oil supplier after Iraq last month, that produce fossil fuels. data from trade sources showed. Still, the study could help spur policy to address the India's oil products exports also fell 17.7%, the data issues, said Gilbert Metcalf, an economist at Tufts showed. Diesel shipments were down 11.7% year- University. "A better understanding of the transfers on-year and 9.1% from the preceding month. involved ... should be extremely helpful for policy Exports to European countries have also taken a hit makers hoping to eliminate these wasteful due to the resurgence of the virus there, said Jigar subsidies." Trivedi, commodities analyst at Mumbai-based broker Anand Rathi Shares. COLUMN-Oil prices left vulnerable after funds stop buying: Kemp U.S. drillers, miners would be out billions if paid Hedge fund positioning in oil had become climate, health costs - study directionless in the run up to last week's sell off, U.S. , and motor fuel producers get after a four-month rally since the first successful implicit benefits worth tens of billion of dollars a year COVID-19 vaccines were announced at the start of by not having to pay for the damage their products November. do to the climate and human health, a study said on Hedge funds and other money managers purchased Monday. the equivalent of just 12 million barrels in the six As the world begins to transition to technologies most important petroleum futures and options that emit less pollution to generate electricity and contracts in the week to March 16. fuel vehicles, economists are attempting to estimate The combined position (913 million barrels) was the cost to society of burning fossil fuels. virtually indistinguishable from the position four In a study published in the Proceedings of the weeks earlier on Feb. 16 (904 million barrels), National Academy of Science, Yale University according to records published by exchanges and economist Matthew Kotchen calculated that U.S. regulators. fossil fuel companies get direct benefits of $62 In contrast, positions had climbed by 548 million billion a year in implicit subsidies due to what he barrels over the previous 15 weeks, an average of calls "inefficient pricing". more than 36 million barrels per week. The overall health, climate and transportation costs Fresh fund buying seems to have dried up when to society are about $568 billion, the study, titled front-month Brent futures prices climbed above $65 "The producer benefits of implicit fossil fuel per barrel – a level that has been sufficient to subsidies in the United States", said. increase U.S. shale production over the last decade. Peabody Energy Corp got about $1.56 billion in The most recent week saw small-scale buying in implicit subsidies in 2018, while Arch Resources got NYMEX and ICE WTI (+3 million barrels), U.S. a little over $1 billion in the same year, the study (+7 million), U.S. diesel (+3 million) and said. European gas oil (+5 million) but minor sales in Natural gas producer EQT Corp got about $696 Brent (-6 million). million while Exxon Mobil got about $688 million, it Between early November and the middle of added. February, hedge fund buying helped accelerate, and None of the companies immediately commented probably exaggerate, the recovery in prices, when asked about the estimates. anticipating a re-opening of service sector The study, the first to estimate the benefits on a businesses and resumption of international air company specific basis, estimated coal companies travel.

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However, once prices had passed the mid-$60s, unsecured creditors." there was a growing risk of overshooting, which Neither PDVSA nor Venezuela's oil ministry limited further buying and ultimately created immediately responded to requests for comment. conditions for a short-term correction, which At its peak, BOPEC had the capacity to store some occurred later last week. 10 million barrels of oil and load large vessels from Over the last 10 years, U.S. shale production has its deep water docks. The company last year was consistently increased whenever prices are much ordered to remove stored oil due to the risk of leaks above $60 per barrel, and captured market share from its tanks. from OPEC whenever prices are over $65. The bankruptcy filing is the latest blow to PDVSA's In a sign of revival within the U.S. shale industry, key network of refining and logistics assets in the the number of rigs drilling for oil in the United States Caribbean. The company is struggling to pay debts has already climbed to 318 from its low of just 172 and maintain basic operations in Venezuela amid in August. U.S. sanctions aimed at ousting President Nicolas The current increase in drilling is following a broadly Maduro. The sanctions have added to the impact of similar trajectory to the resumption of drilling activity years of low investment and mismanagement. after slumps that troughed in May 2016 and May PDVSA's contract to operate Curacao's 335,000 2009. barrel-per-day Isla refinery and a neighboring Prices in the $70-80 range would likely have storage terminal ended in December 2019, and accelerated the resumption of drilling even further, PDVSA unit Citgo Petroleum Corp - now under the threatening to erode OPEC+ market share later in control of the U.S.-backed opposition to Maduro - 2021 and especially in 2022, making prices very last year transferred control of Aruba's San Nicolas unstable in this range. refinery to the island's government. At the same time, slow progress with coronavirus Last year, Refineria de Korsou - which owns the Isla vaccinations and an increase in the number of refinery - had sought to seize BOPEC to collect on infections in Europe threatens to delay the re- debts owed by PDVSA. opening of international air travel in the second half of 2021, dampening the expected recovery in jet EXCLUSIVE-Pemex would consider letting fuel consumption. private group operate Zama oil field, CEO says With production rising, consumption seen weaker, Petroleos Mexicanos (Pemex) would consider and no new fund buying to steady the market, oil having a consortium headed by U.S. company Talos prices were primed for a correction – which arrived Energy operate a shared oil field in southern with a 7% one-day decline on March 18. Mexico, the chief executive officer of the Mexican state oil firm said. PDVSA's Bonaire oil terminal declares Discovered in 2017 in shallow waters of the Gulf of bankruptcy, citing U.S. sanctions on Venezuela Mexico off state, the Zama oil field is A unit of Venezuelan state oil company PDVSA on believed to contain nearly 700 million barrels of oil, the Dutch Caribbean island of Bonaire has declared making it the biggest new find in Mexico by a private bankruptcy, citing the impact of U.S. sanctions on company in decades. Venezuela, a court filing showed. Identified in an area operated by the Talos In a March 9 filing published last week by the Court consortium, the discovery also extends into Pemex's of First Instance of Bonaire, Sint Eustatius and neighboring block. Saba, PDVSA-owned Bonaire Petroleum In 2015, The Talos group won the right to explore Corporation (BOPEC) said it could no longer pay its the block in tenders held under former president debts because sanctions had cut off its "access to Enrique Pena Nieto's opening of the energy market international trade," as well as cash held in bank to private capital. accounts. Zama has become a litmus test of private sector The court granted BOPEC's request for a confidence of President Andres Manuel Lopez moratorium on creditor payments in a filing that Obrador's government, which quickly canceled noted BOPEC said it was negotiating with "a party further oil tenders. that may make the necessary liquid assets Pemex CEO Octavio Romero said although his available" to allow the company to "satisfy its company had the wherewithal to operate the field, preferred creditors and offer a settlement to its he was not set against the private consortium doing

5 March 23, 2021 continued) so, provided it met certain conditions. Nieto's energy reform for the benefit of Pemex and "It's not a case of 'I want (to be the operator) state electricity company the Comision Federal de because I'm the biggest, or I'm the best-looking,' it's Electricidad (CFE), which he said his predecessors because it suits them and it suits us," Romero said wanted to carve up. in an interview in Tabasco. "We're talking about it, we're analyzing it technically." EXCLUSIVE-Mexico seeks better trade terms "It may be at some point the consortium meets all from Vitol following bribery scandal the criteria that matter to Pemex to develop this Mexico is looking to renegotiate some of its field; if all the conditions are acceptable and hundreds of millions of dollars-worth of contracts beneficial for Pemex, we could analyze it," he with Vitol SA after the global energy trader added. acknowledged paying kickbacks to win business Made just ahead of a key deadline for agreement with state oil company Pemex, Reuters has learned. between the two sides, Romero's comments hinted The dispute in Mexico, the world's fourth-largest at a shift in posture: just over a year ago, he said importer of refined oil products, is part of the fallout Pemex wanted to operate Zama, arguing it had from a December agreement that -based most of the deposit and could develop it faster. Vitol Americas made with the U.S. Department of Talos, whose consortium also includes Germany's Justice (DOJ). Wintershall Dea and Britain's Premier Oil, did not The energy trader agreed to pay $164 million to immediately reply to a request for comment. U.S. and Brazilian authorities after admitting it Urging them to come to terms, the energy ministry bribed officials in Mexico, and Ecuador extended until March 25 a deadline for the two between 2015 and 2020 to obtain and retain sides to reach an initial unitization agreement to set business with state oil companies there, the rules on shared operations. deferred prosecution agreement showed. However, since Lopez Obrador took office in Mexican President Andres Manuel Lopez Obrador December 2018, his leftist government has halted on March 3 announced his government has that liberalization of the market and vowed to launched its own criminal investigation into the strengthen Pemex against private competition. scheme. Both Pemex and Talos have argued they can best In addition, Pemex is scouring existing contracts develop Zama and have most of the oil in their part with Vitol for signs of anything "irregular," and will be of the field. looking to jettison provisions it considers Asked whether due to a lack of funds Pemex would unfavorable, Chief Executive Octavio Romero be willing to grant the consortium the right to Oropeza told Reuters in an interview Thursday. operate Zama, Romero said that while economic "Now we need to question practically everything," limitations did exist, they were no reason to sign Romero Oropeza said. "If we can't come to an deals contrary to his company's interests. agreement, we'll stop doing business with Vitol." "We can't accept being told: 'since you don't have The Mexican government's push to seek better the money, you have to accept my conditions,'" he terms from Vitol has not been previously reported. said. Collectively, Pemex's deals with the global trader "We are Mexico," he added, noting that Pemex is amount to "more than $1 billion" said a person with developing infrastructure around Zama in an direct knowledge of the review. "The whole universe attempt to create "synergies" with other discoveries of contracts, any contract (Pemex) considers that would permit cost savings. disadvantageous, is going to be taken to the Romero also said he would rather reach agreement negotiating table," the person said. than have to resolve the matter via international Beyond confirming that the Vitol contracts are under arbitration. review, Pemex, or Petroleos Mexicanos, did not "We have all the credentials to be the operator, we respond to detailed questions from Reuters. believe we have the highest percentage (of the Vitol would not comment on how many active deposit) but we're not closing the door either. If contracts it has with Pemex, the value of those they're prepared to accept what we're proposing, deals or whether Pemex is looking to renegotiate Pemex would consider it," he said. some or all of those agreements. The Geneva- Romero did not provide further details. based company said it had a longstanding and Lopez Obrador has gradually rolled back Pena respectful relationship with Pemex and "always

6 March 23, 2021 continued) cooperates with the relevant authorities." Several Pemex units have contracts with Vitol, The Vitol corruption case is the latest graft scandal including the trading arm PMI Comercio to explode in the region since Brazil's Operation Car Internacional, gas trader Mex Gas Supply Ltd and Wash, a public contracting kickback scheme whose petrochemical unit Pemex Transformacion tentacles reached across Latin America. Industrial, the person said. Since taking office in 2018, Lopez Obrador has Two other sources familiar with the situation taken ever-bolder steps towards rebalancing estimated the company had more than ten contracts Mexico's energy markets in favor of Pemex and with Pemex. federal power utility Comision Federal de Among them is a deal for Vitol to supply Pemex with Electricidad (CFE). ethane gas. That 2018 agreement is worth about Mexico has renegotiated several contracts with $230 million. As of early March, Pemex was still international companies, including pipeline importing shipments of ethane as part of that operators, changes the government claims have contract, according to a person familiar with Vitol's saved taxpayers hundreds of millions of dollars. transport of ethane and Refinitiv Eikon tanker Such moves reflect Lopez Obrador's desire to tracking data. strengthen Mexico's state-run companies, and his That ethane contract, reviewed by Reuters, was belief that previous governments awarded contracts signed by Javier Aguilar, a former Vitol trader at the to private-sector companies in exchange for heart of the DOJ investigation into the company's kickbacks. business in Ecuador, according to the DOJ's For Vitol, the world's largest independent oil trader, deferred prosecution agreement. the prospect of Mexico unearthing more evidence of Aguilar could not be reached for comment. His corruption could result not only in costly attorney said in a statement that "the Department of renegotiations of its contracts, but further damage Justice determined this matter did not warrant to its reputation. formal prosecution." He declined further comment. Competition for government energy contracts in oil- Aguilar last year was charged with conspiring to producing countries such as Mexico is often fierce, violate the anti-bribery provisions of the Foreign several sources familiar with the market said. Corrupt Practices Act and money laundering conspiracy for his alleged involvement in a scheme PHONE LOGS, EMAILS, TRAVEL RECORDS that paid bribes to Ecuadorian government officials. In all, Reuters spoke to seven people with The case is still ongoing, a review of court records knowledge of Vitol's business dealings in Mexico. shows. The news organization reviewed internal communications of Pemex and Vitol, including SNUB OF $30 MILLION letters, memorandums and shipping documents, as Earlier this month, Lopez Obrador said Vitol had well as a Pemex contract obtained through offered to pay Pemex around $30 million in searches of publicly available company archives. damages for the alleged bribes in Mexico. He said The sources and documents, along with Romero he was not satisfied with that offer, in part because Oropeza's comments, reveal heightened scrutiny by Vitol declined to reveal who it had paid off and for Mexican officials regarding the government's which contracts. business with Vitol. In the case unveiled in December, the DOJ said As part of the process, Pemex has ordered an Vitol employees and agents had used an internal evaluation of all company pacts with Vitol intermediary to bribe Mexican officials in order to since 2015, warning employees not to delete any receive inside information to obtain a contract with correspondence with the trader, including emails, an unidentified Pemex subsidiary. phone logs and travel records, according to a Unnamed Mexicans set up sham consulting source familiar with the situation and company agreements with shell companies that issued fake memorandums viewed by Reuters. invoices to disguise the bribes, the deferred Executives of various Pemex units have been prosecution agreement showed. The DOJ said it asked by the company's legal department to identify detected more than $2 million in bribes paid by Vitol contract terms they would like changed in between 2015 and 2020 in Mexico and Ecuador negotiations with Vitol, the person familiar with the alone. It did not name the officials bribed in the review said. scheme.

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The DOJ declined to comment. retaliation for a decision by the three Baltic Lopez Obrador said on March 3 that Pemex had republics, which are all European Union members, referred the case to Mexico's Attorney General's to impose sanctions on the Belarusian government office, and that he hoped prosecutors would seek over its crackdown on pro-democracy details of the alleged wrongdoing from U.S. demonstrators. authorities. Belarus' Mozyr refinery sent its first cargo loaded The Attorney General's office and Pemex did not with 37,000 tonnes of gasoline on March 20 via the respond to requests for comment about the Portenergo terminal in 's Ust-Luga, the complaint or whether Mexico is seeking information sources said. from the United States. The cargo, which they said was bought by , is heading to Amsterdam, Refitiniv Eikon data Oil mogul George Kaiser gets into oilfield showed. services duel with rival The second 37,000-tonnes gasoline cargo is set for The private equity arm of Oklahoma oil and gas loading on March 25-26 for Vitol, the sources added tycoon George Kaiser said it had acquired some on condition of anonymity. oilfield services assets of Pioneer Natural Portenergo, Gunvor and Vitol did not reply to Resources, setting up a shale patch rivalry with Reuters' requests for comments. Belarus plans to billionaire Dan Wilks in the top U.S. shale field. ship a total of 2 million tonnes of oil products via Kaiser's Argonaut Private Equity acquired Pioneer Russian ports this year. Well Services, an oilfield services arm of one of the largest U.S. shale producers, for an disclosed Coral Energy to replace Proton Energy as amount. Both Pioneer and Argonaut did not reply to supplier of 's diesel and LPG to Ukraine requests for comment. in April Wilks earlier this year took stakes in ProPetro Trading firm Coral Energy will replace Proton Holding Corp and NexTier Oilfield Solutions, two of Energy as offtaker of Russian oil giant Rosneft's the top shale well services providers. He and his diesel and LPG for supplies to Ukraine after the brother own Wilks Brothers LLC, which controls Swiss-based group decided to terminate the firm ProFrac Services and had shipments from April 1, three industry sources said engaged in a lengthy takeover battle for Canada's on Monday. Calfrac Well Services Ltd last year. Proton Energy Group SA, which used to be Argonaut said on Monday it rebranded the Pioneer Rosneft's exclusive supplier of diesel and LPG to arm as American Well Services and that it would Ukraine, decided to suspend shipments of Russian partner with existing Argonaut portfolio company, LPG and diesel to the state amid political and Nichols Oil Tools, which provides oilfield equipment economic risks. and services, including pressure pumping. The move followed the forfeit of the Ukrainian part of American Well Services will exclusively work on the diesel pipeline that connects Russia to the state Pioneer Natural's contracts for the next few years, under a decision by the state's Supreme Anti- one person familiar with the matter told Reuters. Corruption Court, which led to the seizure of diesel The Argonaut deal also comes months after owned by Proton Energy that was in the pipeline Pioneer Natural acquired smaller rival Parsley and as a result to financial loss for the firm. Energy in a multi-billion dollar deal, amid a wave of The diesel pipeline with capacity of 3.5 million consolidations among oil producers slammed by the tonnes per year connects Russia with Ukraine, rout in oil prices during the pandemic. Belarus and Eastern Europe. Supplies of Russian diesel are currently suspended amid the seizure of Belarus to ship two gasoline cargoes via Ukraine's part of the pipeline. Russia's Ust-Luga in March, traders say Coral Energy will take on the volumes Rosneft Belarus is set to ship two cargoes containing a total supplied to Proton Energy from April, the sources of 74,000 tonnes of gasoline via the Russian Baltic said. The trading firm will lift about 40,000 tonnes of Sea port of Ust-Luga in March, two trading sources LPG monthly and some 100,000 tonnes of diesel. said and Refinitiv data showed, as Minsk re-directs The firm will likely transport the volumes by rail, flows from Estonia, Latvia and Lithuania. traders said. The arrangement was agreed last month in Coral Energy and Rosneft did not respond to

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Reuters requests for comment. edged sword". Pipeline and rail exports of diesel oil of Rosneft The government promised an end to the fuel origin to Ukraine totalled some 1.75 million tonnes subsidies last year, which have cost the government in 2020, according to traders' estimates. billions of dollars, but rising oil prices have LPG exports from Rosneft's plants to Ukraine complicated the effort. reached 496,900 tonnes in 2020. State oil company NNPC is negotiating with Relations between Ukraine and Russia collapsed organised labour to find a way to allow petrol prices after Moscow annexed Crimea from Ukraine in to float without unduly harming the nation's poor and 2014 and Moscow backed fighters in the Donbass working class. region in a war that has killed thousands and Ahmed said they did not plan to pay subsidies, and brought Western sanctions against Russia. that officials hope the cost of importing fuel does not reduce NNPC's remittances to the federal Rising oil boosts Nigeria's 2021 budget but government. creates fuel price headache Oil prices are averaging around $50 per barrel, Nigeria is optimistic about funding its 2021 budget above the $40 per barrel projected in the 13.6 trillion due to rising oil prices, but is engaged in a "tussle" naira ($35.74 billion) budget document. with organised labour over how it can end fuel Ahmed also said discussions were ongoing over subsidies without harming the poor, Finance concerns brought to the World Trade Organization Minister Zainab Ahmed said on Monday. regarding Nigeria's foreign exchange management. Oil prices, which are averaging around $10 per She declined to elaborate beyond say the barrel above the level projected for the 2021 discussions were "a work in progess". budget, are good for the nation's revenues, she told The WTO is concerned about how Nigeria's foreign journalists, but are complicating plans to end costly exchange management has been used to support fuel subsidies. manufacturing, exports and imports, its director- "We made recommendation to deregulate the general Ngozi Okonjo-Iweala - a former Nigerian pricing of (gasoline). But we have a stalemate with finance minister who took the top job at the WTO labour," she said, calling the oil price rise a "double this month - said on Monday.

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(Inside Oil - Asia Edition is compiled by Rupali Shukla in Bengaluru) Refinitiv 3 Times Square, New York, NY 10036 For questions or comments about this report, contact: [email protected] Please visit: Refinitiv for more information. To subscribe to Asia Oil newsletter, click here. Privacy statement

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