COMPANY NEWS IN BRIEF
Exxon, BHP to invest US$291 mln
Exxon Mobil Corp and BHP Group said on Thursday they will go ahead with a project to boost gas output from their Gippsland Basin Kipper field off southeast Australia, which would help fill a looming gas shortage in the local market.
Exxon's Esso Australia said the project would cost about A$400 million (US$291 million) to extract an additional 200 petajoules (PJ) of gas over the coming five years, adding that about 30 PJ will be produced next year.
The country's regulators have warned that eastern Australia faces a gas shortfall from 2026, largely because the ageing gas fields in the Gippsland Basin Joint Venture, which has been the biggest supplier into the market for decades, are drying up.
Esso operates the joint venture in a 50-50 partnership with global miner BHP.
The extra production from the Gippsland Basin will come online ahead of five proposed liquefied natural gas (LNG) import terminals, looking to serve the same market. Only one of those has begun preliminary construction work. -Reuters
BMW hit by supply disruptions
Michelin and BMW were among the latest companies on Wednesday to warn of disruption to their operations from Russia's invasion of Ukraine, while ad group Publicis said it had ceded control of its Russian business to protect its staff.
The list of Western companies that have suspended operations or pulled out of Russia is growing by the day after the West imposed sanctions aimed at curbing Moscow's access to funding.
German automaker BMW joined other carmakers in detailing the impact of the unfolding crisis in Ukraine on its operations on Wednesday as it downgraded its profit margin forecast.
Russia's invasion of Ukraine and Covid-19 related disruptions in China have forced carmakers from Toyota to Tesla to shutter plants and raise prices, with many warnings of further pain if circumstances do not stabilise.
BMW said that while it was still able to source some parts from western Ukraine and was engaging alternative suppliers to keep up production, further interruptions were to be expected in coming weeks. -Reuters
UniCredit considers quitting Russia
UniCredit is urgently reviewing its Russian business and could decide on a costly exit of the country after its invasion of Ukraine, the Italian bank's CEO said on Tuesday, as markets watch for a payment on Russian sovereign debt.
A growing list of financial firms are looking to exit Russia, with Deutsche Bank, Goldman Sachs and JPMorgan Chase winding down business there.
Unicredit Chief Executive Andrea Orcel also said the economic environment had changed because of the Ukraine crisis and the bank was now assuming there would be stagflation - or a combination of low growth and high inflation.
Italy's second-biggest bank last week said a full write-off of its Russian business, including cross-border exposure, would cost around 7.4 billion euros (US$8.1 billion), leaving its plans to distribute capital to shareholders hanging by a thread. UniCredit is one of Europe's banks most exposed to Russia.
Russia has US$117 million in payments due on Wednesday on two dollar-denominated Eurobonds. Its finance ministry has said it will make the payments in roubles if sanctions prevent it from paying in dollars - a move markets would view as a default. -Reuters
Volkswagen prioritises China
Volkswagen is shifting production to China and the United States as a result of the war in Ukraine and will prioritise China this year, its Chief Executive Herbert Diess said in a press call on Tuesday.
"We will shift more into China because of the situation in Europe," Diess said. When asked about how the carmaker would respond in the event that China attacked Taiwan, he said that he did not believe the country would take such a step.
"China has a high interest to keep borders open," Diess said. "We think it is an asset for us to be strong in China.China is a stronghold for us."
The carmaker has suspended production in Russia following the country's invasion of Ukraine.
A lack of wire harnesses normally sourced from Ukraine was the most significant supply chain constraint at the moment, Diess said, affecting most German plants. If it could not relocate production in 3-4 weeks, its outlook would need to be revised, Diess said. -Reuters
Verizon secures contracts
Telecoms giant Verizon Communications Inc said on Wednesday it had secured new business worth almost US$1 billion from the US Department of Defense to provide technical support and network modernization services.
The deal includes contracts for services to the Pentagon, the National Capital Region (NCR) and Fort Belvoir at a combined value of US$966.5 million.
Verizon will provide internet-protocol-based services, voice and video services and network-related support aimed at accelerating the department's digital pivot.
The company said it would also help plan, design and implement network upgrades and provide new equipment to the Pentagon. Shares of Verizon rose 0.5% in premarket trading. -Reuters
Exxon Mobil Corp and BHP Group said on Thursday they will go ahead with a project to boost gas output from their Gippsland Basin Kipper field off southeast Australia, which would help fill a looming gas shortage in the local market.
Exxon's Esso Australia said the project would cost about A$400 million (US$291 million) to extract an additional 200 petajoules (PJ) of gas over the coming five years, adding that about 30 PJ will be produced next year.
The country's regulators have warned that eastern Australia faces a gas shortfall from 2026, largely because the ageing gas fields in the Gippsland Basin Joint Venture, which has been the biggest supplier into the market for decades, are drying up.
Esso operates the joint venture in a 50-50 partnership with global miner BHP.
The extra production from the Gippsland Basin will come online ahead of five proposed liquefied natural gas (LNG) import terminals, looking to serve the same market. Only one of those has begun preliminary construction work. -Reuters
BMW hit by supply disruptions
Michelin and BMW were among the latest companies on Wednesday to warn of disruption to their operations from Russia's invasion of Ukraine, while ad group Publicis said it had ceded control of its Russian business to protect its staff.
The list of Western companies that have suspended operations or pulled out of Russia is growing by the day after the West imposed sanctions aimed at curbing Moscow's access to funding.
German automaker BMW joined other carmakers in detailing the impact of the unfolding crisis in Ukraine on its operations on Wednesday as it downgraded its profit margin forecast.
Russia's invasion of Ukraine and Covid-19 related disruptions in China have forced carmakers from Toyota to Tesla to shutter plants and raise prices, with many warnings of further pain if circumstances do not stabilise.
BMW said that while it was still able to source some parts from western Ukraine and was engaging alternative suppliers to keep up production, further interruptions were to be expected in coming weeks. -Reuters
UniCredit considers quitting Russia
UniCredit is urgently reviewing its Russian business and could decide on a costly exit of the country after its invasion of Ukraine, the Italian bank's CEO said on Tuesday, as markets watch for a payment on Russian sovereign debt.
A growing list of financial firms are looking to exit Russia, with Deutsche Bank, Goldman Sachs and JPMorgan Chase winding down business there.
Unicredit Chief Executive Andrea Orcel also said the economic environment had changed because of the Ukraine crisis and the bank was now assuming there would be stagflation - or a combination of low growth and high inflation.
Italy's second-biggest bank last week said a full write-off of its Russian business, including cross-border exposure, would cost around 7.4 billion euros (US$8.1 billion), leaving its plans to distribute capital to shareholders hanging by a thread. UniCredit is one of Europe's banks most exposed to Russia.
Russia has US$117 million in payments due on Wednesday on two dollar-denominated Eurobonds. Its finance ministry has said it will make the payments in roubles if sanctions prevent it from paying in dollars - a move markets would view as a default. -Reuters
Volkswagen prioritises China
Volkswagen is shifting production to China and the United States as a result of the war in Ukraine and will prioritise China this year, its Chief Executive Herbert Diess said in a press call on Tuesday.
"We will shift more into China because of the situation in Europe," Diess said. When asked about how the carmaker would respond in the event that China attacked Taiwan, he said that he did not believe the country would take such a step.
"China has a high interest to keep borders open," Diess said. "We think it is an asset for us to be strong in China.China is a stronghold for us."
The carmaker has suspended production in Russia following the country's invasion of Ukraine.
A lack of wire harnesses normally sourced from Ukraine was the most significant supply chain constraint at the moment, Diess said, affecting most German plants. If it could not relocate production in 3-4 weeks, its outlook would need to be revised, Diess said. -Reuters
Verizon secures contracts
Telecoms giant Verizon Communications Inc said on Wednesday it had secured new business worth almost US$1 billion from the US Department of Defense to provide technical support and network modernization services.
The deal includes contracts for services to the Pentagon, the National Capital Region (NCR) and Fort Belvoir at a combined value of US$966.5 million.
Verizon will provide internet-protocol-based services, voice and video services and network-related support aimed at accelerating the department's digital pivot.
The company said it would also help plan, design and implement network upgrades and provide new equipment to the Pentagon. Shares of Verizon rose 0.5% in premarket trading. -Reuters
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