Major International Business Headlines Brief::: 06 November 2019

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Major International Business Headlines Brief::: 06 November 2019

 


 

 


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*  Total to drill another offshore well in South Africa early 2020

*  South Africa's PetroSA eyes Russia for $359 mln farmout deal

*  Moody's lowers S. African Eskom's rating deeper into junk

*  Total aiming for two additional LNG trains in Mozambique LNG

*  Senegal announces launch of oil and gas licensing round

*  Goldman's sub-Saharan Africa CEO Coleman to leave firm

*  Nigerian president signs bill amending offshore oil output act

*  Shoprite's USave a bright spot in S.Africa's slowing economy

*  Boeing boss gives up bonus following plane crashes

*  Facebook changes product branding to FACEBOOK

*  Millennial men demand better parental leave

 


 <mailto:info at bulls.co.zw> 

 


 

Total to drill another offshore well in South Africa early 2020

CAPE TOWN (Reuters) - French oil and gas major Total said it will drill
another exploration well in the 11B/12B block offshore South Africa in the
first quarter of next year, a senior company official said on Tuesday.

 

Earlier this year, Total opened up a new play off South Africa’s southern
coast, after making an offshore discovery that could contain 1 billion
barrels of total resources while drilling its Brulpadda prospects in the
Outeniqua Basin.

 

 

 

 

 

 

 

 

 

 


 <mailto:info at bulls.co.zw> 

 


 

South Africa's PetroSA eyes Russia for $359 mln farmout deal

CAPE TOWN/MOSCOW (Reuters) - South Africa’s national oil company PetroSA and
Russia’s state geological company Rosgeologia are in talks to finalise a
$359 million farmout deal to give Russia its first foothold in a prospective
oil and gas field offshore South Africa, three sources said.

 

PetroSA is under pressure to boost dwindling domestic resources that have
imperiled its flagship Mossel Bay gas-to-liquid refinery, which is operating
well below capacity. The company is hoping the tie-up with Rosgeologia
(Rosgeo) and other partners, including Norway’s Equinor, will accelerate
exploration in acreage it holds.

 

Farmout deals, which are commonplace in the global petroleum industry, see a
license holding party give another party a percentage of that license in
exchange for services - in this case paying for exploration drilling which
can cost around $50 million a well.

 

Rosgeo and PetroSA’s negotiations are focused on Block 9/11A, adjacent to
where Total has made a huge oil and gas discovery.

 

“There are certain parts of the block that are unexplored, so Rosgeo made an
offer,” said one PetroSA source, adding that the exploration rights also
cover the smaller 11A block.

 

A Rosgeo source said it expected the deal - shrouded in secrecy after first
being touted in 2017 at a BRICS summit in China - would have been finalised
last month at a Russia-African summit.

 

 

 

 

Rosgeo told Reuters that it was “working on a series of proposals for
PetroSA on the project implementation.”

 

PetroSA and South Africa’s ministry did not immediately respond to request
for comment.

 

In an October presentation to parliament’s portfolio committee on mineral
resources and energy seen by Reuters, South Africa’s state-run Central
Energy Fund (CEF), the holding company for PetroSA, said they wanted to
conclude the Rosgeo deal in 2019.

 

It said the deal would entail geophysical surveys, geochemical studies and
the drilling of six exploration and appraisal wells, adding that investment
would be based on funding from loans repayable if the exploration was not
successful.

 

CEF said they were also dealing with a farmout offer along South Africa’s
west coast from a prospective partner it identified in the presentation as
“Statoil” - now known as Equinor - for Blocks 5/6/7 as well as Block 2C.

 

An Equinor spokesman said it did not currently have any drilling planned in
South Africa.

 

 

 

Moody's lowers S. African Eskom's rating deeper into junk

JOHANNESBURG (Reuters) - Moody’s pushed state power firm Eskom’s credit
rating deeper into sub-investment territory on Tuesday, saying a government
plan to reorganise the cash-strapped South African firm would be hard to
implement without explicit support from the cabinet.

 

Moody’s cut Eskom’s long-term corporate family rating, or unguaranteed debt,
to B2 from B3, six notches below the investment grade level, with a negative
outlook.

 

The rating firm also cut the rating on the power company’s zero coupon
eurobonds to B2 from B3.

 

The agency on Friday kept South Africa’s sovereign debt at Baa3, the lowest
rung of investment grade, but revised the outlook on that rating to
“negative”.

 

The government announced a sweeping overhaul of the power sector in a paper
published last Tuesday, confirming the break up of Eskom over the next three
years and opening the industry up to more competition.

 

The paper set out a vision for a restructured electricity supply industry,
where Eskom could relinquish its near-monopoly and compete with independent
power producers (IPPs) to generate electricity at least cost.

 

Moody’s said the plan could bring modest financial benefits for the company
over the medium term but failed to address pressing, immediate issues.

 

“Important questions, including how the rights of existing creditors will be
respected as Eskom is reorganised, remain unanswered,” the ratings agency
said.

 

“This makes any turnaround of the company’s operations very difficult
without a clear steer and support from the government.”

 

Local analysts have said the plan does not appear to have full buy-in from
President Cyril Ramaphosa’s cabinet and the ruling African National
Congress.

 

Moody’s said weak corporate governance and political sensitivity around
Eskom’s tariffs and its high employment levels would compound the
constraints on the turnaround plan.

 

In response, Eskom noted Moody’s decision “with disappointment” but said it
was working to resolve its challenges.

 

“Liquidity levels remain low. We have, however, seen a considerable amount
of support for Eskom paper from the local markets and coupled with the
financial support announced by the government, we are cautiously confident
that our debt obligations are not at risk.”

 

The National Union of Mineworkers (NUM), which supported Ramaphosa’s
campaign for the ruling party presidency in 2017, has threatened to cause
more power cuts over the government’s decision to forge ahead with the plan
to break up Eskom.

 

 

 

Total aiming for two additional LNG trains in Mozambique LNG

CAPE TOWN (Reuters) - French energy major Total aims to expand its
Mozambique liquefied natural gas (LNG) project with two additional trains,
or plants, where the gas is supper-chilled for easier transport, a company
executive said on Tuesday.

 

“We’re starting to look at studies for train 3 and train 4, because the
resources are clearly there to develop,” Mike Sangster, head of Total
Exploration and Production for Nigeria, told an oil conference in Cape Town,
South Africa.

 

Total concluded the acquisition of Anadarko’s 26.5% interest in the
Mozambique LNG project for $ 3.9 billion in September as part of its
takeover of Anadarko’s Africa assets that included projects in Ghana and
Algeria.

 

Sangster added that the company expected to close its acquisition of
Anadarko assets in Ghana and Algeria early next year once regulatory
approvals were cleared.

 

The firm said in September the Mozambique project included the construction
of a two-train liquefaction plant with a capacity of 12.9 million tonnes per
year.

 

Sangster said costs for Mozambique were “very competitive” with good terms.

 

The firm has said 90% of Mozambique LNG was already sold under long-term
contracts largely indexed to the oil price.

 

Jean-Pierre Sbraire, Total’s Chief Financial Officer, said in a call with
analysts during the company’s third quarter results that “Mozambique LNG was
a jewel” the its acquisition of Anadarko’s Africa assets.

 

 

 

Senegal announces launch of oil and gas licensing round

CAPE TOWN (Reuters) - Senegal on Tuesday announced a new oil and gas
licensing round for three offshore blocks as the country prepares to tap
rich reserves in a bid to boost revenues.

 

Senegal’s offshore oil and gas reserves have the potential to transform the
poor West African country when they start flowing in the next decade, with
volumes expected to rival some of the region’s biggest producers.

 

“We are launching today for the first time in the history of petroleum
exploration in Senegal a licensing round of three blocks of sediment basin,”
oil minister Mahamadou Makhtar Cisse said at an oil and power conference in
Cape Town.

 

The legal phase of the licensing round will conclude in late January he
added, with a legal framework to be presented at international conferences
in Houston, London and Dakar.

 

A second phase, which will begin in February and end on July 31, will enable
petroleum companies to evaluate the potential of the blocs.

 

Senegal, where oil was discovered in 1961, expects all its offshore projects
to come online between 2022 and 2026.

 

According to the International Monetary Fund, between 2014 and 2017, oil and
gas reserves worth more than 1 billion barrels of oil and 40 trillion cubic
feet of gas, most of it shared with Mauritania, were found.

 

Claims that President Macky Sall’s brother was involved in fraud related to
two offshore gas blocks being developed by BP have cast a shadow over
Senegal’s oil and gas plans.

 

Aliou Sall, who denied the allegations, resigned from his government post in
June after prosecutors launched an inquiry into the claims reported by the
BBC.

 

 

 

Goldman's sub-Saharan Africa CEO Coleman to leave firm

JOHANNESBURG (Reuters) - U.S. investment bank Goldman Sachs said on Tuesday
that its sub-Saharan Africa chief executive, Colin Coleman, would retire
from the firm at the end of the year.

 

 

Coleman, 57, has headed Goldman’s Johannesburg office since 2000 and is one
of the country’s best-connected bankers, having nurtured ties with senior
figures in the African National Congress (ANC) since being involved in the
anti-apartheid movement in the 1980s.

 

Goldman did not say who would replace Coleman, who will become a senior
fellow and lecturer at Yale University’s Jackson Institute for Global
Affairs, splitting his time between South Africa and the United States.

 

The Wall Street bank is seeking a South African banking licence as part of
plans to offer fixed income products, beefing up its African operations as
global rivals scale back.

 

Coleman’s departure is not expected to affect those plans.

 

 

 

Nigerian president signs bill amending offshore oil output act

LAGOS (Reuters) - Nigeria’s President Muhammadu Buhari signed into law on
Monday a bill that amends legislation on agreements related to offshore oil
production, according to the president’s Twitter account.

 

While offshore oil projects are among the most challenging for companies to
develop, they have helped boost oil output in the last few years from
Nigeria, Africa’s top crude producer.

 

 

 

Shoprite's USave a bright spot in S.Africa's slowing economy

JOHANNESBURG (Reuters) - In a bright spot amid South Africa’s economic woes,
Shoprite Holdings managed a 7.3% rise in quarterly revenue as shoppers
turned to its discount unit USave.

 

While its international operations saw sales fall 4.9% hurt by currency
devaluations and anti-immigrant attacks, the supermarket operator reported a
10.3% rise in South Africa for the three months to Sept 30.

 

 

It opened eight USave stores, which offer discounted goods in low income
areas, in the quarter.

 

Days of riots in South Africa chiefly targeting foreign-owned businesses
sparked retaliatory attacks elsewhere, forcing Shoprite to close several
stores in early September in South Africa, Nigeria and Zambia.

 

“Management is assessing the performance of the Supermarkets Non-RSA
segment, with specific reference to the Group’s return on capital invested
in Africa,” Shoprite said in a statement without providing detail.

 

The company’s other operations comprising OK Franchise, Computicket,
Medirite pharmacies, and Checker’s Food Services reported a 6.4% increase in
sales.

 

 

 

Boeing boss gives up bonus following plane crashes

Boeing's boss Dennis Muilenburg will not take a bonus this year following
two crashes involving the firm's 737 Max plane which killed 346 people.

 

Boeing's chairman David Calhoun said Mr Muilenburg had made the suggestion.

 

Mr Muilenburg recently faced US lawmakers who accused the firm of building
"flying coffins" and engaging in a "pattern of deliberate concealment".

 

But Mr Calhoun said Mr Muilenburg "has done everything right".

 

Mr Calhoun, who took over as chairman after Mr Muilenburg was stripped of
the role last month, told CNBC that the chief executive retained the
confidence of Boeing's board.

 

For 2018, Mr Muilenburg's pay included a $13m (£10.1m) bonus on top of his
$1.7m salary. His total pay package rose 27% from 2017.

 

Last October, a Boeing 737 Max operated by Lion Air crashed, killing all 189
people on board.

 

Five months later an Ethiopian Airlines plane crashed, killing 157 people,
after which the entire 737 Max fleet was grounded.

 

Media captionAdnaan Stumo, whose sister Samya died in the Ethiopian Airlines
crash, says Mr Muilenburg must go

At last week's hearing with US senators, families of people who died in the
crash told the BBC that they felt Mr Muilenburg was evasive and should
resign.

 

"I want him to say unequivocally that he takes responsibility for the deaths
of 346 people because the crashes were preventable," said Paul Njoroge, who
lost five family members in the Ethiopian Airlines crash.

 

Adnaan Stumo, whose sister Samya died in the Ethiopian Airlines crash, said
Mr Muilenburg should step down "and go to jail".

 

 

Senators also criticised the regulatory process, saying there was excessive
"cosiness" between the firm and safety officials at the Federal Aviation
Administration (FAA).

 

Mr Muilenburg told the hearing that the firm supported "strong oversight"
but declined to support increasing the authority of the FAA, which has been
criticised for delegating too much of its oversight to company officials.

 

 

Speaking to CNBC on Tuesday, Mr Calhoun said that the company did not have
any plans to change the name of the 737 Max.

 

Since the grounding of the 737 Max fleet in March, Boeing has said it is
fixing the model's software and has overhauled its review procedures.

 

In April, Boeing reduced production of the plane by almost a fifth. Mr
Calhoun said the company was not expecting to make any further production
cuts.

 

Separately, the head of the International Air Transport Association (IATA)
said regulators should co-operate in assessing the airworthiness of the 737
Max rather than pursuing their own approval processes.

 

Alexandre de Juniac told Reuters that taking an individual approach was "a
big, big, big mistake".

 

"We have built the safety of this industry on the single certification
decision and the mutual recognition and it has worked very well."--BBC

 

 

 

Facebook changes product branding to FACEBOOK

Facebook is introducing new branding for its products and services in an
attempt to distinguish the company from its familiar app and website.

 

Instagram and WhatsApp are among the services that will carry the new
FACEBOOK brand in the next few weeks.

 

The main Facebook app and website will retain its familiar blue branding.

 

The new logo, which is in capital letters, uses "custom typography" and
"rounded corners" so the company's other products and app look different.

 

The branding also appears in different colours depending on which product it
represents. So, for example, it will be green for WhatsApp.

 

"We wanted the brand to connect thoughtfully with the world and the people
in it," Facebook said. "The dynamic colour system does this by taking on the
colour of its environment."

 

Facebook's chief marketing officer Antonio Lucio said: "People should know
which companies make the products they use. We started being clearer about
the products and services that are part of Facebook years ago.

 

"This brand change is a way to better communicate our ownership structure to
the people and businesses who use our services to connect, share, build
community and grow their audiences."

 

 

US Senator Elizabeth Warren has said she wants to break up the big tech
companies such as Facebook, Amazon and Google and put them under tougher
regulation.

 

This plan may be seen as Facebook's way of hitting back, although Ms Warren
- posting on Facebook - said: "Facebook can rebrand all they want, but they
can't hide the fact that they are too big and powerful. It's time to break
up Big Tech."

 

Distancing the Facebook brand - the blue app that's home to just about
everyone, including your parents - from the trendier Instagram, a place for
you and your friends, has always made good business sense for Facebook.

 

And it apparently worked: when Pew researchers asked study participants
whether or not Facebook owned Instagram or WhatsApp, 49% of American adults
were "not sure".

 

So why would Facebook make this change?

 

It brings several benefits. Front of mind: the firm is covering itself from
accusations it hides how powerful it really is by not making it absolutely
clear they are behind most of the biggest apps in social media.

 

And Facebook also wants to fend off efforts to break it up, by making the
case that the company isn't simply a conglomerate of separate, distinct apps
which could be easily broken up by regulators. Instead, this rebranding
argues the firm is one big connected organism, called Facebook.

 

Facebook has come under criticism recently over a variety of issues.

 

Its boss Mark Zuckerberg had to face US lawmakers last month to explain the
company's policy on not fact-checking political adverts.

 

He also had to defend plans for a digital currency, talk about the social
network's failure to stop child exploitation on the network, and was quizzed
over the Cambridge Analytica data scandal.

 

Earlier in the year, Mr Zuckerberg said the firm was going to make changes
to its social platforms to enhance privacy.

 

These included messages sent via Messenger being end-to-end encrypted, and
hiding the number of likes an Instagram post receives from everyone but the
person who shared it.

 

Does rebranding always work?

Several other big companies have tried rebranding in the past:

 

*         In 2001, British Airways turned tail on its plans to remove the
red, white and blue Union flag from its aircraft and replace it with "world
images"

*         In the same year, Royal Mail rebranded as Consignia, only to swap
back again a year later

*         Dunkin' Donuts dropped the "Donuts" from its name last year to try
to move more into the coffee industry and its share price has continued to
rise

*         The parent company of Paddy Power and Betfair started trading
under the new name Flutter Entertainment in May this year. It said the new
name "better reflected the diversity of the group".

*         'If it ain't broke, don't fix it'

Manfred Abraham, chief executive of consultancy Brandcap, told the BBC: "I'm
sure this will be a successful move for Facebook. After all, the parent
brand remains strong, despite recent troubles, and reminding consumers that
Instagram etc are all Facebook companies will assist with cross-membership.

 

"The rebrand is unsurprising as it is following a trend - that of
simplification. Many organisations are choosing a strong, but pared-back
visual identify and are shrugging off 'flair' in favour of plain."

 

However, Mr Abraham thought Facebook was correct to leave the logo on its
flagship social media platform as it is.

 

"Facebook's main site doesn't need a rebrand. The old adage is true: if it
ain't broke don't fix it."--BBC

 

 

 

Millennial men demand better parental leave

Yash Puri returned from three months parental leave last week and
immediately decided to spread the word about the benefit of spending time
with his young children.

 

"I see dads in the office who want to know about my story. They say: 'I wish
I could do that', and I say: 'You can do it, you've got to bite the
bullet'," the 37-year-old IT expert says.

 

Mr Puri - a father of two - says many organisations don't know how to
support new dads.

 

"They are struggling how to understand to support the men. I don't think men
know themselves they can do this," says Mr Puri, who is a partner at IT
consultancy FIS.

 

Taking parental leave is not always straightforward, not least because of
the cost involved.

 

The TUC has said problems can occur at the point that workers fall back on
statutory pay when they take time out.

 

Analysis by the University of Birmingham found only 9,200 new parents (just
over 1% of those entitled) took shared parental leave in 2017-18.

 

But companies are starting to offer enhanced parental leave - not just
maternity leave - to respond to the demands of their staff.

 

The latest is Goldman Sachs, which on Monday announced that men and women
would get the same fully-paid leave, of at least 20 weeks, whether they had
become new parents through birth, surrogacy or adoption.

 

That follows two FTSE 100 companies - Standard Life Aberdeen and Vodafone -
which last week announced steps to try to equalise the experience of men and
women in the workplace when babies are born.

 

Sarah Churchman, chief diversity and inclusion officer at PwC, says a
generational change is underway.

 

"I think many more parents of both genders now want to be more hands-on
parents, particularly in the early years. We're seeing that ourselves among
our young millennial men."

 

Both men and women taking time out of the workplace should - in theory at
least - lead to more equality in terms of pay and opportunity, and comes as
politicians are focusing on inequality in work. In the UK, for instance,
companies are being forced to publish their gender pay gap.

 

Paternity leave: 'All of my dad friends were incredibly jealous'

Gender pay gap progress dismally slow, says charity

In the notoriously testosterone-driven world of finance, Goldman's chief
executive David Solomon said the changes it was making were "designed to
enable everyone in our workforce to better manage the commitment to their
careers while starting, growing and supporting a family".

 

The bank's 6,000 staff in the UK will be offered 26 weeks full parental pay,
while in the rest of the word it will be 20 weeks. The US bank is even
offering $10,000 for egg retrieval and $20,000 for egg donation.

 

While other firms are not going that far, Standard Life Aberdeen's plan is
seen as one of the most generous. It is offering nine months full pay for
parents - both mothers and fathers - regardless of whether the mother gives
birth to the baby, the baby is born via surrogacy, or if the child is
adopted.

 

It is aimed at the UK - where the Edinburgh-based financial firm employs
4,564 people. All new parents are eligible, regardless of gender, family
set-up or how long they have been at the company, and it can be taken in
three blocks over two years.

 

Rose Thomson, chief HR officer at Standard Life Aberdeen, has admitted that
this contrasts sharply with her own experience, as her husband took just a
week off when they had their children, now 20 and 16.

 

"I think he would look at this policy and say: 'Wow, I would have loved to
have been able to spend a lot more time with my children when they were
little'."

 

Standard Life Aberdeen estimates about 180-200 people will be eligible and
among those planning to take up the new arrangement is Tim Coombs, a
London-based business development director.

 

His wife will be having their first child in April and he says the stigma
that can be associated with taking time out from the workplace has gone.

 

"I know that's been a concern for people in the past," he says.

 

"There's a flexibility. You can take three instalments. That's the big thing
for me. It's not all or nothing."

 

Attracting staff

At telecoms group Vodafone all 92,000 employees around the world will be
offered 16 weeks full paid parental leave, starting from next April.

 

They will be able take it at any time over the first 18 months, and it will
be available for employees whose partners are having babies, adopting or
having a child through surrogacy.

 

Other companies with such policies include mobile phone operator O2, which
gives 14 weeks for all permanent employees, and drinks company Diageo, which
gives its 4,500 employees an equal 52 weeks parental leave, with the first
26 weeks fully paid.

 

John Palmer, senior guidance adviser at Acas, says such policies can help
businesses attract staff.

 

"Taking this approach means that these businesses are likely to stand out
attractive employers in what has been an increasingly competitive labour
market."

 

However, such generous parental leave is rare and there are many instances
where women feel let down.

 

Joeli Brearley lost her job a day after telling her company she was
pregnant. Her experience prompted her to set up the "Pregnant Then Screwed"
campaign group, which helps woman in similar situations.

 

"It's very common that people are treated badly," she says,

 

She cites data from the Equality and Human Rights Commission, from a
government-commissioned study, that shows as many as 54,000 mothers a year
felt they had to leave their jobs while pregnant.

 

There is more to be done - and not just for people needing to care for new
families.

 

PwC's Ms Churchman says: "Having a young family is one thing. What about
looking after an older family? We have to think about that as well as the
workforce evolves."

 

What are your rights?

Pregnant employees have the right to 52 weeks maternity leave.

 

The first 26 weeks is known as ordinary maternity leave, and the second 26
weeks as additional maternity leave.

 

Statutory maternity pay (SMP) is payable for 39 weeks. For the first six
weeks it is paid at 90% of average weekly earnings. The following 33 weeks
is paid at the SMP rate or 90% of average weekly earnings, whichever is the
lower. From 6 April, SMP was set at £148.68 per week.

 

But some employers offer contractual maternity pay that is more than the
statutory rate.

 

Shared parental leave allows parents - after birth or adoption - to share up
to 50 weeks of leave and up to 37 weeks of pay .

 

Each parent can take up to three blocks of leave, more if their employer
allows, interspersed with periods of work.

 

Paternity leave is a period of either one or two consecutive weeks that
fathers or partners can take off from work to care for their baby or child.

 

The partner can receive statutory paternity pay of £148.68 per week,
provided they have worked for the company for 26 weeks.

 

Source: Acas

 

 

 

 

 

 


 

 


 

INVESTORS DIARY 2019

 


Company

Event

Venue

Date & Time

 


 

 

 

 

 


 

 

 

 

 


Companies under Cautionary

 

 

 


 

 

 

 


Bindura Nickel Corporation

 

 

 


Padenga Holdings

 

 

 


Delta Corporation

 

 

 


Meikles Limited

 

 

 


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