Slump in energy prices is pushing the US energy giant to sell assets in Bangladesh.
There is a feeling of sales in the air; this could be because Chevron Corp. has shown interest in the sale of its operations in Bangladesh; there has been much interest from oil and gas division from across the region including the Government of Bangladesh.
But it seems Chevron Corp. is no hurry to exit Bangladesh as they issued a statement to Bloomberg which stated “We can confirm that Chevron has been in commercial discussions about our interests in Bangladesh. At this step, no decision has been made to sell our interests. We will only proceed if we can realize attractive value for Chevron.”
Their Bangladeshi operation is supposedly priced at about $2 billion, and there has been interesting from the Oil and Natural Gas Corp. Ltd. India, a multinational oil and gas company; Hong Kong-listed United Energy Group Ltd; A joint offer from United Energy with Chinese conglomerate Orient Group Inc. and Brightoil Petroleum Holdings Ltd., sources said.
There has been a drastic change in oil prices, from a peak of $115 per barrel in June 2014 to under $35 at the end of February 2016; Currently, WTI crude oil is trading around $50 per barrel.
Chevron, one of Bangladesh’s largest foreign investors, operates the natural gas fields in Bibiyana, Jalalabad and Moulavi Bazar. They currently sell all their production to state oil company Petrobangla, with a net daily production last year which averaged 720 million cubic feet of natural gas and 3,000 barrels of condensate.
In 2015 Chevron began shuffling and trimming its portfolio after losses in the fourth quarter of 2015, which included cuts in Bangladesh which employees about 2000 people to manage its three natural gas fields.
Chevron Corp. reported a loss of $725 million in comparison to their $2.6 billion earnings in the first quarter of 2015. Its net oil-equivalent return of 1.9 million barrels per day expressed a 1 percent drop year-on-year. Spending, when, was almost 25 percent lower than first quarter 2015 at $6.5 million.
The company unveiled plans in October 2015 to sell about $10 billion worth of assets by 2017.
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