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BP-UAE $2B Israel Gas Deal on Hold Amid Regional Conflict
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BP plc (BP - Free Report) and the Abu Dhabi National Oil Company (“ADNOC”) have decided to halt their $2 billion bid to acquire a 50% stake in Israeli gas field operator NewMed Energy. The move was a result of the Israeli company citing “uncertainty created by the external environment” as the reason behind the suspension, according to a statement released on Wednesday.
NewMed holds the largest stake in the Leviathan offshore field, a significant gas reservoir operated by Chevron Corporation (CVX - Free Report) , which plays a crucial role in exporting gas to both Egypt and Jordan. The company confirmed that all parties involved have agreed to suspend discussions but expressed continued interest in pursuing the proposed deal.
The proposed acquisition, initiated by BP and ADNOC a year ago, aimed at establishing a joint venture, granting them access to the gas-rich areas in the Eastern Mediterranean and Israel's burgeoning energy sector. However, complications emerged along the way, including a recommendation from a review panel to increase the asking price by 10%, as indicated by sources familiar with the matter.
NewMed clarified in a regulatory filing that the decision to halt the deal was influenced by the prevailing "external environment," evidently referring to the ongoing conflicts in Gaza and along the Israel-Lebanon border.
The deal, which would have seen BP extending its presence in the eastern Mediterranean and marked ADNOC's first venture into the region, is now put on hold. However, both companies emphasized that they remain committed to collaborating on other projects. Last month, BP and ADNOC announced plans to establish a joint venture in Egypt, focusing on natural gas. Originally, this venture was conceived as the second phase of their cooperation in the Eastern Mediterranean, following the potential acquisition of NewMed.
The decision to suspend the deal emphasizes the challenging regional conditions posed by geopolitical tensions, particularly the recent escalation of hostilities between Israel and Gaza.
Sunoco is among the biggest motor fuel distributors in the U.S. wholesale market in terms of volumes. By distributing more than 10 fuel brands via 10,000 convenience stores under long-term distribution contracts, the partnership will continue to generate stable cash flow.
The Zacks Consensus Estimate for SUN’s 2024 EPS is pegged at $4.89. The stock has witnessed upward earnings estimate revisions for 2024 and 2025 in the past 30 days.
Murphy USA is a leading independent retailer of motor fuel and convenience merchandise in the United States.
The Zacks Consensus Estimate for MUSA’s 2024 EPS is pegged at $25.58. The company has a Zacks Style Score of B for Growth and B for Value. It has witnessed upward earnings estimate revisions for 2024 and 2025 in the past 30 days.
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BP-UAE $2B Israel Gas Deal on Hold Amid Regional Conflict
BP plc (BP - Free Report) and the Abu Dhabi National Oil Company (“ADNOC”) have decided to halt their $2 billion bid to acquire a 50% stake in Israeli gas field operator NewMed Energy. The move was a result of the Israeli company citing “uncertainty created by the external environment” as the reason behind the suspension, according to a statement released on Wednesday.
NewMed holds the largest stake in the Leviathan offshore field, a significant gas reservoir operated by Chevron Corporation (CVX - Free Report) , which plays a crucial role in exporting gas to both Egypt and Jordan. The company confirmed that all parties involved have agreed to suspend discussions but expressed continued interest in pursuing the proposed deal.
The proposed acquisition, initiated by BP and ADNOC a year ago, aimed at establishing a joint venture, granting them access to the gas-rich areas in the Eastern Mediterranean and Israel's burgeoning energy sector. However, complications emerged along the way, including a recommendation from a review panel to increase the asking price by 10%, as indicated by sources familiar with the matter.
NewMed clarified in a regulatory filing that the decision to halt the deal was influenced by the prevailing "external environment," evidently referring to the ongoing conflicts in Gaza and along the Israel-Lebanon border.
The deal, which would have seen BP extending its presence in the eastern Mediterranean and marked ADNOC's first venture into the region, is now put on hold. However, both companies emphasized that they remain committed to collaborating on other projects. Last month, BP and ADNOC announced plans to establish a joint venture in Egypt, focusing on natural gas. Originally, this venture was conceived as the second phase of their cooperation in the Eastern Mediterranean, following the potential acquisition of NewMed.
The decision to suspend the deal emphasizes the challenging regional conditions posed by geopolitical tensions, particularly the recent escalation of hostilities between Israel and Gaza.
Zacks Rank & Key Picks
BP currently carries a Zack Rank #3 (Hold).
A couple of better-ranked stocks in the energy sector are Sunoco LP (SUN - Free Report) and Murphy USA Inc. (MUSA - Free Report) , each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Sunoco is among the biggest motor fuel distributors in the U.S. wholesale market in terms of volumes. By distributing more than 10 fuel brands via 10,000 convenience stores under long-term distribution contracts, the partnership will continue to generate stable cash flow.
The Zacks Consensus Estimate for SUN’s 2024 EPS is pegged at $4.89. The stock has witnessed upward earnings estimate revisions for 2024 and 2025 in the past 30 days.
Murphy USA is a leading independent retailer of motor fuel and convenience merchandise in the United States.
The Zacks Consensus Estimate for MUSA’s 2024 EPS is pegged at $25.58. The company has a Zacks Style Score of B for Growth and B for Value. It has witnessed upward earnings estimate revisions for 2024 and 2025 in the past 30 days.