Tuesday, July 22, 2008
GE, Abu Dhabi Form $8 Billion Mideast Investment Fund
July 22 (Bloomberg) -- General Electric Co.., turning to sovereign wealth as it exits U.S. consumer financing, formed an $8 billion venture with Abu Dhabi's Mubadala Development Co. to profit from commercial investments in the Middle East and Africa.
State-owned Mubadala also said it wants to become a top 10 holder in Fairfield, Connecticut-based GE, whose shares have lost about a quarter of their value since April 11. That's when Chief Executive Officer Jeffrey Immelt reduced his 2008 profit forecast as seize-up in capital markets hurt some GE finance divisions.
GE, the world's biggest maker of power-plant turbines and medical imaging machines, will also build a research center in Abu Dhabi's new Masdar City among other ties. GE and Mubadala will each contribute $4 billion in equity over three years to the fund, aiming to reach $40 billion in assets.
Monday, July 21, 2008
DRC's Hydroelectric Project Gets AfDB Backing
The African Development Bank has pledged USD15.53 million to finance a
hydroelectric project in the Democratic Republic of Congo. The
memorandum of agreement signed by the bank and the Central African
country allocates funds to the proposed Inga hydroelectric power plant,
dubbed as one of the world's greatest hydroelectric power projects.
("AfDB grants USD15.53 mln to DRC for hydroelectric project" - Xinhua
News Agency, July 18, 2008)
LS Power, Global Infrastructure Bid for TransAlta
By Jim Polson
July 21 (Bloomberg) -- LS Power Equity Partners and Global Infrastructure Partners offered to buy TransAlta Corp., Canada's largest publicly traded electricity producer, for about C$7.75 billion ($7.72 billion).
The bid is for C$39 a share in cash, 21 percent higher than TransAlta's last closing price, LS and Global said today in a filing with the U.S. Securities and Exchange Commission. The acquisition would take TransAlta private and leave its headquarters in Calgary.
LS, the U.S. power-plant developer allied with Dynegy Inc., is TransAlta's largest shareholder with a stake of about 9 percent, according to the filing. New York-based Global is a $5.64 billion fund led by former Credit Suisse Group executives. TransAlta said in a statement that it will review the offer, made in a letter received after the close of trading on July 18, and ``respond in due course.''
Thursday, July 17, 2008
Global Demand Calls The Shots As Domestic Rebar Prices Soar
07/16/2008
In late spring, contractors were hit by a devastating increase in prices for concrete reinforcing bars, surpassing the record increases of 2004. Strong global demand is calling the shots and a weak dollar is cutting off any relief imports may offer as rebar prices hit new record levels.
“We’re being told the mills want to move U.S. prices to equivalent world prices,” says says a manager at a Midwest rebar fabricating and distribution company. “The [steel] mills are leaning toward another price increase regardless of where scrap prices go,” he tells Platts Steel Markets Daily, New York City. Platts is part of the McGraw-Hill Cos, which also owns ENR.
China on brink of electricity shortfall
By Jamil Anderlini and Geoff Dyer in Beijing
China faces its worst power shortage in at least four years as soaring coal prices and government-set electricity tariffs force dozens of small power plants to shut down rather than face mounting losses.
Nearly half of China’s provinces have started to ration electricity as the country enters the peak summer season, facing what analysts describe as its worst coal shortage.
Analysts warn that this year’s electricity shortfall could be more severe than in 2004, when the country was affected by its worst power shortage in decades because of soaring demand for power as the economy boomed.
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Wednesday, July 16, 2008
Goldman Sachs' solar play
By Andrew Leonard - Salon.com
"...One major theme of the piece is the emerging conflict between solar energy developers and environmentalists who want to ensure that the solar land rush in the Mojave Desert doesn't end up wreaking its own variety of environmental havoc. Will the desert tortoise become the new spotted owl?
My own feeling is that it's essential to hold renewable energy developers to the strictest environmental standards, or what's the point? But I was also fascinated by Woody's account of Goldman Sachs' solar "prospecting."
...No one has been as quick to move into the Mojave -- or as tightlipped about it -- as Solar Investments."
GR Energy Bags Rs,4,900 Cr. EPC Contract In Rajasthan
(RTTNews) - Wednesday, BGR Energy Systems Ltd., manufacturer of capital goods and executor of turnkey engineering projects, announced that the company has bagged the largest ever EPC contract for Rs.4,900 crores from Rajasthan Rajya Vidyut Utpadan Nigam Ltd or RRVUNL for the 2 x 600MW Kalisindh Thermal Power Project at Jhalawar, Rajasthan.
The company's scope of supply includes design, engineering, supply of boiler, steam turbine generator and complete balance of plant equipment inclusive of all mechanical, electrical, instrumentation and control systems and civil, structural and architectural works, necessary for putting the thermal power station into operation.
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Cleveland-Cliffs to buy Alpha for nearly $10B
Mining company Cleveland-Cliffs to buy rival Alpha Natural Resources for nearly $10 billion
NEW YORK (Associated Press) - Iron and coal miner Cleveland-Cliffs Inc. said Wednesday it will buy coal producer Alpha Natural Resources Inc. for nearly $10 billion in cash and stock in a move to boost its role as a supplier to the global steel industry.
The boards of both Cleveland-Cliffs and Abingdon, Va.-based Alpha Natural have approved the deal, in which Alpha shareholders will receive 0.95 Cleveland-Cliffs shares ($105.89 based on the stock's Tuesday closing price) and $22.23 in cash for each share held.
The $128.12 combined price represents a 35 percent premium to Alpha's Tuesday close of $94.92. Based on the company's 70.3 million outstanding shares at April 23, the deal is valued at $9.01 billion. In a statement, the companies valued the transaction at $10 billion.
Read complete articleBig Chinese Power Firms Suffer Profits Outage
(Forbes) Squeezed between soaring coal costs and government controls on electricity rate charges, two of China's top power producers said Tuesday that they expect to post half-year losses. But scheduled rate hikes for the second half may prevent or stem yearly losses for the firms, analysts say. Huaneng Power International and Huadian Power International significantly bolstered electricity output, by 13% and 65%, respectively, in the first half of 2008, compared to the equivalent period last year. But sharply rising coal prices, which are up by 60 yuan ($8.80) per metric ton since the start of 2008, according to the East China Electricity Regulatory Bureau, wiped out profit. Soaring oil prices also contributed to higher transport costs for the power companies. Because of government controls in the interest of combating consumer price inflation the firms are unable to raise rates freely in response. The two firms did not give details on the expected scale of their losses. More than 80% of the country's power producers reported losses for the year’s first five months.
Tuesday, July 15, 2008
Cuba's slowing economy
Rising international prices of food and fuel, which account for around 40% of Cuban import spending, are affecting domestic output. The vice-president, Carlos Lage, reported in June that he expects the food import bill to leap from US$1.47bn in 2007 to US$2.55bn in 2008. Most of the food is distributed by the subsidised ration system, so the burden of higher prices (including a threefold increase in the price of rice) is absorbed mainly by the state budget. This has forced a reduction in public investment, which is likely to constrain GDP growth.
It also explains the urgency of government efforts to increase domestic food production and improve efficiency. Although some domestic food prices have been raised, the impact on consumer spending of the higher cost of importing food will be slight. The fiscal impact of higher fuel prices is cushioned by an oil import agreement with Venezuela, which provides financing on favourable terms.
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Mining Company Bids for Rival
TORONTO (Reuters) — Barrick Gold has started a hostile bid of 354 million Canadian dollars, or $350 million, for Cadence Energy to lock in cheaper oil prices and get control of soaring production costs, the world’s top gold miner said on Monday. The all-cash bid — a premium of 10 percent on Cadence’s Toronto-listed closing price on Friday — comes after Cadence has already agreed to a takeover offer of 301 million Canadian dollars from Daylight Resources Trust.
Barrick said its offer was contingent on the completion of due diligence and said it would file a formal offer as soon as possible.
Cadence said in a separate release that it had not entered into any agreement with Barrick and that its board maintains its recommendation for the Daylight Resources offer.
Read complete articleMonday, July 14, 2008
The Med’s moment comes
Globalisation is bringing a wave of money to the Mediterranean
LOOK southward from the southern tip of Spain, across the strait of Gibraltar. There, only 14km (nine miles) away through the slight sea haze, arises the vast construction works of a new seaport to the east of Tangier in northern Morocco. Tanger Med (pictured) opened its first docks last July. Handling 3.5m containers a year, it is already as big as Felixstowe, Britain’s biggest port. A second terminal opens this summer, and within seven years its annual capacity will rise to 8.5m. It will be the largest container port in the Mediterranean, not far behind Europe’s biggest, Rotterdam (although merely one-third the size of the Asian giants of Singapore, Shanghai and Hong Kong). Similar ports are being finished in Algeria, Egypt, Malta and Tunisia.
One-third of the world’s container traffic already passes through the Mediterranean, bringing manufactured goods from China and South-East Asia to Europe and the east coast of America. The Moroccans, spending some €3.5 billion ($5.5 billion) on Tanger Med, and others along the coast hope that if they build, a big slice of global commerce will come to their shores. Goods will arrive to be broken down into smaller loads and sent around Europe. Manufacturers will set up factories in tax-free zones planned around the docks, bring in components for assembly and serve the huge market across the water.
Republic Services to review Waste Management offer
NEW YORK (AP) -- Waste hauler Republic Services Inc. says its board of directors will review an unsolicited acquisition offer from Waste Management Inc.
Republic says it will respond to the $6.19 billion, or $34 per share, cash offer from the largest U.S. waste collector "in due course."
Republic Services and Allied Waste Industries Inc., the No. 2 and No. 3 players, respectively, in waste collection agreed to combine their companies in June in a $6.07 billion stock deal.
Read complete articleBush to Lift Ban on Oil, Gas Drilling off U.S. Coasts
By Daniel Whitten and Catherine Dodge
July 14 (Bloomberg) -- President George W. Bush will lift a presidential moratorium on drilling for oil and natural gas on the U.S. Outer Continental Shelf, setting up a showdown with Congress over a separate ban it put in place in the 1980s.
Bush ``has decided to lift the executive ban on oil exploration in America's Outer Continental Shelf,'' White House spokesman Dana Perino told reporters. ``Congress has not moved forward despite calls from constituents and the continued pressure of record high energy prices.''
Pressure to permit drilling off the Pacific and Atlantic Ocean coastlines and in the Eastern Gulf of Mexico has been building as oil and gasoline prices have surged to records.
Congress has barred drilling since 1983 through an annual Interior Department spending bill. That ban could be lifted if Bush refused to sign the department's fiscal 2009 appropriations measure that is now being debated in both the House and Senate.
Friday, July 11, 2008
Mexico Growth Was `Relatively Good,' Carstens Says
By Jens Erik Gould
July 11 (Bloomberg) -- Mexico's second-quarter economic growth was ``relatively good'' and sales figures posted by Wal- Mart de Mexico SAB during that period were also encouraging, Finance Minister Agustin Carstens said.
The economy is showing signs of strength, Carstens said today at a finance conference in Queretaro, Mexico, citing the creation of more than 50,000 jobs in June and Walmex's 12 percent increase in second-quarter sales.
``It was a very encouraging figure,'' Carstens told reporters. ``We're reasonably optimistic.''
Mexico's government aims for annual economic growth of 5 percent by 2012, the year President Felipe Calderon's six-year term ends. Economic expansion slowed to 2.6 percent in the first quarter, more than economists forecast, as the construction industry stagnated and agricultural output fell.
Oil Lifts Consumer-Product Prices, Too
Due to soaring oil prices, everyday consumer items including plastic bags, shampoo, and diapers cost more
Many American consumers winced when gas prices hit $4 a gallon. But the price of oil has had an impact beyond the pump. Everyday items such as plastic bags, clothing, and even diapers have increased along with the cost of gas. "There are a lot of people who are having a hard time now," says John Simpson, a spokesman for the advocacy group Consumer Watchdog. "And things are going to get a lot tougher when gas hits $5 a gallon."
Already businesses such as Jelly Belly Candy are feeling the pinch. The maker of jelly beans and other candies has managed to absorb the transportation costs that have risen with the price of gas. But Jelly Belly's signature clear plastic bags have become more expensive to produce. "We have had to spend more on those little, clear plastic bags than ever and pass the costs on to our customers," says Bill Kelley, vice-chairman of Jelly Belly. "It is a good thing that candy is a recession-resistant industry."
Plastics are not the only products that have become more expensive. Dow Chemical (DOW) raised the price of its chemical products by as much as 20% in the last two weeks. Asphalt prices have increased by 55% from May 2007 to May 2008, according to Argus Media's most recent Argus Asphalt Report. And, according to Information Resources, a Chicago-based market research firm, the price of cosmetics and personal-care products such as shampoo, lipstick, and deodorant has gone up an average of 2.4% in the same period.
Read complete articleOil workers at Brazil's Petrobras plan strike: report
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Wednesday, July 9, 2008
Lula May Increase Brazil's Oil Take as Tupi Spurs Rules Review
July 9 (Bloomberg) -- Brazilian President Luiz Inacio Lula da Silva may boost the government's stake in oil fields after the largest discovery in the Americas since 1976 prompted a review of rules for how petroleum deposits are developed.
Lula is examining how Brazil and producers will share revenue from offshore deposits that may hold more than $6 trillion of oil at current prices. Lula said the Tupi discovery and nearby prospects will at least triple Brazil's crude reserves, and he wants the wealth to be shared nationwide.
``This oil is ours, it belongs to the people, not Petrobras or Shell,'' Lula said in a June 26 interview in Brasilia, referring to state-controlled Petroleo Brasileiro SA and Royal Dutch Shell Plc of The Hague. ``The wealth is not for the few, it's for the many.''
Brazil would join oil-rich nations demanding a bigger piece of record profits after petroleum prices tripled in four years. State-controlled Petrobras is calling for agreements like those used by Nigeria to take ownership stakes rather than selling concessions. Unions that helped bring Lula to power in 2003 are lobbying lawmakers to nationalize the industry, a decade after opening it to competition.
Read complete articleMerrill Lynch: Emerging Market Infrastructure Spending Will Surge 80% in the Next Three Years
By Jason Simpkins - Associate Editor
Merrill Lynch & Co. Inc. has raised its annual infrastructure-spending estimate for emerging markets by 80%, as developing countries try to keep pace with fast-growing economies and large cash reserves, BusinessWeek reported.
Investment in infrastructure, which the firm sees as the long-term solution to inflation, will rise from $1.25 trillion to $2.25 trillion annually over the next three years. And China, the Middle East, and Russia will account for 70% of infrastructure spending.
The report from Merrill Lynch pointed out that Xstrata PLC recently predicted emerging markets would spend $22 trillion on infrastructure in the next 10 years.
“That estimate is among the highest we’ve seen,” the report noted, “with an implied run rate of $6.6 trillion over the next three years.”
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Tuesday, July 8, 2008
Repsol Holds Talks With Rosneft to Buy Sakhalin Stake
July 8 (Bloomberg) -- Repsol YPF SA, Spain's largest oil company, is holding talks with OAO Rosneft to buy 24 percent of the Veninsky block on Russia's Sakhalin Island as it cuts reliance on South America for supplies.
The stake would require spending $64 million this year to explore the block in the Sakhalin-3 project, in Russia's Far East, Madrid-based Repsol said in a statement today. The company expects to complete the purchase this month, a Repsol official who declined to be identified said earlier today.
The purchase ``could be interesting for Repsol as it fits with its strategic plan of developing its liquefied natural gas business and diversifying the oil upstream business away from Argentina and Bolivia,'' Bruno Almeida da Silva, an analyst at Banco BPI SA, said today in a note.
Monday, July 7, 2008
Towards talks on reactors from Russia
By Vladimir Radyuhin
India and Russia have found a way to push ahead with the agreement without formally sealing it.
The Indo-Russian nuclear cooperation agreement initialled by Nuclear Power Corporation head S.K. Jain and State Secretary Nikolai Spassky of Russia’s Atomic Energy Agency in New Delhi on Monday opens the way for negotiating a commercial contract for the supply of four additional Russian reactors at Koodankulam. “The way is now open for work on the contract,” an official spokesman for the Russian atomic energy agency, Rosatom, said.
India’s decision not to sign the agreement during Prime Minister Manmohan Singh’s Russia visit in November 2007 raised a few eyebrows in Moscow. The delay in signing the agreement pushed back the preparation of the contract for the supply of the reactors.
“Construction work for the additional reactors can only start after a contract has been signed. But before the contract is drafted Russia and India must first sign or initial an intergovernmental agreement,” Rosatom spokesman Sergei Novikov told Hindu The. “In [the] case of Bulgaria [which last month signed a deal for two Russian reactors] it took the sides a full year to negotiate the contract.”
Read complete articleItaly clears 46.3 billion euros infrastructure priority programme - report
MILAN (Thomson Financial) - Italy's CIPE ministerial committee for economic programming has cleared infrastructure minister Altero Matteoli's proposals for 46.3 billion euros of priority projects, Il Sole 24 Ore reported.
In an unsourced report Saturday, the newspaper said CIPE has approved public resources of a combined 14 billion euros over the next three years to fund the long-term infrastructure projects.
The clearance follows queries last week from the economy ministry, it said, noting that some priority details are sketchy.
The 46.3 billion euro total comprises three high speed train projects: 5.1 billion for Milan/Genoa, 5.6 billion for Milan/Verona, and 3.3 billion for Verona/Padova, the newspaper said.
Other state rail projects amount to 10.0 billion euros, Anas motorway agency projects 12.0 billion, and Messina straits bridge 6.1 billion, it said.
A further 4.2 billion euros is earmarked for projects in water, urban transport systems, and port sector, it said.
Impregilo SpA is leading the consortium to build the Messina bridge, as well as being involved in other high speed rail and motorway projects.Bursting at the Seams, São Paulo Overhauls
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Thursday, July 3, 2008
South American Productivity Leadership Forum - Private Meetings GO LIVE on Monday!
"Catalyzing South American Competitiveness"The Four Seasons Hotel · Washington, DC
July 23-24, 2008
Meet One-on-One With these Project Presenters: Concession, Financing and Engineering Opportunities!
- Northeast Argentina Gas Pipeline (ARG)
- Belgrano Railroad (ARG)
- Cristo Redentor System (ARG-CHI)
- Sao Paulo Rail Ring (BRA)
- Sao Paulo Commuter Train Series 5000 Fleet Renewal (BRA)
- Sao Paulo City Infrastructure Partnerships & Bus Corridors (BRA)
- Line 2 Metro Sao Paulo (BRA)
- Rio de Janeiro State Highway Ring-Road (BRA)
- Rio de Janeiro Beltway (BRA)
- Bioceanic Project (BRA)
- Santos Port (BRA)
- Itaguai Port (BRA)
- Porto Alegre- Rio Grande Highway (BRA)
- Port of Rio Grande Container Terminal (BRA)
- La Línea Tunnel (COL)
- Ruta del Sol (COL)
- Magdalena Train Corridor (COL)
- Nueva Independencia Highway (COL)
- Public Transport Systems (COL)
- Bucaramma Airport Package (COL)
- Ecuador-Colombia-Peru-Bolivia- Chile Interconnection
- Manta Port Expansion (ECU)
- Itaipu Machinery Upgrade (PAR)
- Asuncion Airport Modernization (PAR)
- Callao Port Modernization (PER)
- Lima-Tingo María-Pucalpa Highway (PER)
- Second Airport Concession Package (PER)
- North-South Railroad (PER)
- Montevideo Port (URU)
| 2º Annual Global Infrastructure Leadership Forum: UPDATE CG/LA's team of analysts has submitted a preliminary study of the top 200 infrastructure projects to be considered for the 2º Global Infrastructure Leadership Forum. The list will be released next week to Forum Sponsors. If your firm would like to consider sponsoring the Forum, please send us an email requesting the sponsorship benefits summary. The Forum will be held at the Mayflower Hotel in Washington D.C. on Dec. 10-12th, and will be limited to 500 delegates from the public and private sectors, so pre-register now! |
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God Bless the Dollar!
Just in time for the 4th of July Celebrations. Let's go shopping now!
LONDON (AP) -- The U.S. dollar was mostly higher against other major currencies in European trading Thursday morning. Gold rose.
The euro traded at $1.5880, down from $1.5888 late Wednesday in New York.
Other dollar rates:
-106.29 Japanese yen, up from 105.99
-1.0142 Swiss francs, unchanged
-1.0152 Canadian dollars, up from 1.0122
The British pound was quoted at $1.9856, down from $1.9936.
Gold traded in London at $939.75 per troy ounce, up from $936.00 late Wednesday.
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A Second Wind for Aging Wind Turbines
A two-year wait for new turbines is forcing some buyers into the secondhand market to meet the EU's carbon reduction targets
The 100 or so inhabitants of the Isle of Gigha, off the west coast of Scotland, aren't your typical trendsetters. Yet when this small island community spent $870,000 for three secondhand Vestas (VWS.CO) back in 2004, it became one of the first buyers to tap Europe's blossoming market for used wind turbines.
Now churning out enough power to meet almost all of Gigha's annual electricity needs, the 675-kilowatt wind farm has significantly cut the island's carbon dioxide footprint while generating an annual $150,000 profit for Gigha Renewable Energy, the locally owned company that operates the turbines. "To be honest, we bought them for financial reasons," says Jacqui MacLeod, manager of the Isle of Gigha Heritage Trust.
Read complete articleWednesday, July 2, 2008
India's Economy Hits the Wall - Businessweek
Growth is slipping, stocks are down 40%, and foreign stock market investors are fleeing. Businessmen blame the ruling coalition for failing to make reforms
Just six months ago, India was looking good. Annual growth was 9%, corporate profits were surging 20%, the stock market had risen 50% in 2007, consumer demand was huge, local companies were making ambitious international acquisitions, and foreign investment was growing. Nothing, it seemed, could stop the forward march of this Asian nation.
But stop it has. In the past month, India has joined the list of the wounded. The country is reeling from 11.4% inflation, large government deficits, and rising interest rates. Foreign investment is fleeing, the rupee is falling, and the stock market is down over 40% from the year's highs. Most economic forecasts expect growth to slow to 7%—a big drop for a country that needs to accelerate growth, not reduce it. "India has gone from hero to zero in six months," says Andrew Holland, head of proprietary trading at Merrill Lynch India (MER) in Mumbai. Many in India worry that the country's hard-earned investment-grade rating will soon be lost and that the gilded growth story has come to an end.
Read complete articleForum Energy Jumps on Philex Petroleum Takeover Offer
By Friederike Peters and Kari Lundgren
July 2 (Bloomberg) -- Forum Energy Plc, the U.K. oil and natural-gas explorer operating in the Philippines, rose the most since 2006 in London trading after Philex Petroleum Corp. made a 13.8 million pound ($27.4 million) takeover offer.
Forum Energy gained 19.5 pence, or 80 percent, to 44 pence at 11 a.m., giving the Chertsey, England-based company a market value of 13.1 million pounds ($26 million). It's the biggest winner among all stocks traded on the London exchange today.
Philex Petroleum bought a 13.9 percent stake yesterday at 48 pence a share and will buy the remaining shares at the same price, it said today in a statement. Philex Petroleum is 51 percent owned by Philex Mining Corp., the Philippines' biggest miner by market value. In a separate statement, Forum Energy said it's consulting its advisers about the bid.
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