RM100 billion crisis looms for Petronas and 1MDB Malaysia?
This was what a learned friend pointed out to No News Is Bad News today:
“XXX, Read the above article. If Petronas has a 35% stake, it could mean it has to foot out RM100 billion to the Chad government based on this high court ruling!!!! This would bring down Petronas which can be translated to another economic crisis for Malaysia.”
WOW! What’s happening in Petronas! Any clarification please, Petronas or 1Malaysia Development Berhad (1MDB) Prime Minister Najib Razak, for Malaysians!
Here are two reports with the details:
"Business News
Home > Business > Business News
Friday, 7 October 2016 | MYT 10:21 PM
Exxon hit with US$74bil fine; Petronas also named in the case
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| Petronas' logo is seen at a petrol station in Kuala Lumpur against a darkening sky. - Reuters pic |
A Bloomberg report, citing a court document, said the High Court in the African republic’s capital, N’Djamena, announced its ruling on Oct 5 in response to a Finance Ministry complaint that the consortium hadn’t met its tax obligations.
The court also demanded the Texas-based oil giant pay US$819mil (RM3.4bil) in overdue royalties, the document said.
Bloomberg noted that the US$74bil fine was about five times more than Chad’s gross domestic product and exceeded the fines of US$61.6bil (RM255.2bil) slapped on BP Plc after the Deepwater Horizon oil spill in 2010.
The two other companies named in the case are Petronas and Chevron Corp.
Petronas is believed to have a 35% stake in the Exxon-led project, which is located at the Doba basin in southern Chad. Chevron, meanwhile, sold its 25% stake to the Chadian government in 2014.
Petronas has been involved in a tax dispute in Chad previously (in 2006), which led Chadian president Idriss Deby to order it and Chevron to leave the country. However, the two oil firms settled the matter. - The Star online"
Chad oil ..."Chad high court fines Exxon-led oil consortium $75 billion
By DANY PADIRE
Oct. 6, 2016 5:38 PM EDT
N'DJAMENA, Chad (AP) — Chad's high court has ordered an oil consortium led by Exxon Mobil Corp. to pay a fine of more than $75 billion after the country's finance ministry accused it of not paying royalties.
Exxon spokesman Todd Spitler said Thursday that Exxon disagrees with the ruling and is "evaluating next steps."
Chadian officials were not immediately available to comment on the ruling or the fine's size, which is several times the country's GDP. The World Bank says that was about $10.8 billion last year.
"This dispute relates to disagreement over commitments made by the government to the consortium, not the government's ability to impose taxes," Spitler said.
Exxon and its partners, including Malaysian state oil company Petronas, filed for arbitration in July with the International Court of Arbitration in Paris over an exemption from export duties on crude production. They said the exemption was included in the consortium's agreement with Chad.
One of the consortium's original partners, Chevron Corp., said in 2014 that it sold its 25 percent stake for $1.3 billion.
That was just weeks before the price of crude began a deep and long slump, falling from over $100 a barrel to under $30 at one point this year before recently rallying to around $50 a barrel.
Chad is a relative newcomer to the oil industry, becoming a producer in 2003. The U.S. Energy Information Administration estimates the country's output at 120,000 barrels a day, or about 44 million barrels in 2015.
The landlocked country, which remains one of the world's poorest, exports its oil via a pipeline through Cameroon.
Associated Press writer David Koenig in Dallas contributed to this report."
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