Glencore Replaces Sinopec In Chevron’s South Africa Asset Sale

by eggplant in BFI

Switzerland-based mining giant Glencore PLC will acquire assets in South Africa and Botswana from Chevron Global Energy Inc., after a similar deal between Chevron and Chinese oil behemoth Sinopec Group fell through earlier this year. Glencore will buy a 75% stake in Chevron South Africa Proprietary Ltd. and wholly acquire Chevron Botswana Proprietary Ltd., for a total of over USD 970 million, Glencore said in a statement on 6 October. Sinopec had announced in March that it would buy Chevron’s Botswana subsidiary and the 75% stake in the South Africa business for USD 900 million, after rounds of bidding that included offers from Glencore and France’s Total SA. The Chinese company had planned to rebrand Chevron’s Caltex gas stations in the two countries under Sinopec’s name. In April 2016, Sinopec sold a 40% stake in its investment arm, Sinopec International Petroleum Exploration and Production Corp. (SIPC), in a deal it said was intended to “increase its competitiveness and achieve sustainable, healthy development.” In August this year, SIPC said it would terminate its Addax Petroleum operations in Switzerland because of continued low oil prices. But Sinopec, together with China’s other “Big Three” oil companies — China National Petroleum Corp. and China National Offshore Oil Corp. — placed a vote of confidence in the global oil market this year when they announced plans to invest a combined RMB 371 billion (USD 54 billion) in 2017. “Sinopec does have a number of challenges to address domestically in both the upstream (declining assets) and downstream (competition from teapots),” an industry term for China’s privately-owned oil refineries, Virendra Chauhan, oil analyst at Energy Aspects, told Caixin.

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