Financial trackers and tools

Apaches egypt quandary symbolizes tough business call


´╗┐Apache Corp (APA. N) faces a difficult choice in Egypt: whether to sell its substantial oil and natural gas operations in the country or wait out the recent bloodshed. The Texas-based energy company has said it is assessing the value of its Egyptian interests, which account for roughly a fifth of its global oil and gas production and 27 percent of its revenue last year. While production has not been affected so far by the violence, Apache's shares have fallen 5 percent since July 3, when former Egyptian President Mohamed Mursi was overthrown. Many analysts believe the turmoil contributed to the dip."The sooner they get the hell out of there, the better," Oppenheimer & Co analyst Fadel Gheit said. "Investors have plenty of risk in the stock market. They don't want civil war risk in their portfolios, too."But selling now would likely mean accepting a price undercut by political uncertainty. At the end of 2012, about 7 percent of Apache's oil and natural gas assets were in Egypt, worth roughly $854.1 million. Analysts said it was hard to put a current value on the operations because of the turmoil."Apache is not going to resort to a fire sale," said Gheit, "But it's a long-term challenge if they decide to stay and operate there."The quandary is not unique to Apache. More than 250 U.S. companies, ranging from Dow Chemical Co (DOW. N) to Citigroup Inc (C. N), operate in Egypt, where the army-backed government has instituted a month-long state of emergency. Apache and other Western companies are now weighing whether the risks of operating in Egypt outweigh the rewards.

Last week, General Motors (GM. N), Electrolux (ELUXb. ST) and BASF (BASFn. DE) temporarily closed facilities in Egypt, citing the unstable security situation. BG Group BG. L and BP (BP. L) pulled out non-essential expatriate staff last month. Kristian Ulrichsen, a fellow at the policy-focused Baker Institute in Houston, saw less risk in the short term for companies working in Egypt than later on, when the reverberations from the government crackdown are felt."The longer-term risks are a whole segment of the population being cut out of the political roadmap. That's something that will play out over years," he said, citing Algeria's bloody civil war in the 1990s as a worrying precedent. "I hope Egypt won't go down that route, but you can see the danger."Apache, which bought BP's oilfield stake in the western Egyptian desert for $650 million in 2010, has more than $1.3 billion in insurance policies covering its Egyptian operations in the event the government confiscates its assets, cancels contracts or nationalizes the oil industry.

"We're watching the situation closely," Apache spokesman Patrick Cassidy said. POTENTIAL VS REALITY The Texas-based company's 9.7 million acres in Egypt, of which it so far has only developed 18 percent, promise "considerable exploration and development opportunities," according to securities regulatory filings. A U.S. Energy Information Administration report last month singled out exploration by Apache as being responsible for many of the oil discoveries in Egypt during the past five years.

Apache declined to say how many employees it has in Egypt. Brokerage Raymond James estimates Apache has roughly 200 expatriates and as many as 10,000 local workers."The most important thing about Egypt is it generates a tremendous amount of cash flow," Apache Chief Executive Steve Farris said on a conference call with investors this month."And we just need to figure out a way to validate that value without giving up that value," he added. Analysts interpreted his comments to mean a sale of the assets was probable. A Chinese oil company could be a likely buyer of Apache's Egyptian assets given China's long-standing interest in Africa and need for oil, said Oppenheimer's Gheit. Proceeds from a sale would allow the company to buy back shares and trim its $12.3 billion debt load, he said. In a step largely seen as a positive for foreign oil companies, Egypt's oil ministry on Thursday named Tarek El Molla as the head of Egyptian General Petroleum Corp

Chinas property loans climb in q1


´╗┐BEIJING, April 25 Bank loans to Chinese home buyers and property developers rose sharply in the first quarter of 2014, Reuters calculations from central bank data showed on Friday, even as the property market has shown signs of cooling. Chinese banks lent 797 billion yuan ($128 billion) to home buyers and developers in the first three months of 2014, up from 440 billion yuan in the fourth quarter and 12 percent higher than a year earlier. Strong demand for property loans suggests China's housing market remains resilient even if growth is cooling. Official data showed home price gains slowed to an eight-month low in March.

Total outstanding property loans issued hit 15.4 trillion yuan at the end of March, up 19 percent from a year ago, though down a touch from annual growth of 19.1 percent at the end of December, the central bank said on its website. this site

Outstanding mortgages at the end of March were up 20.1 percent from a year ago, also down a shade from December's annual 21 percent rise, it said.

China's property market has lost steam since late 2013 as authorities tightened controls on speculative buying, and as banks made it harder for home buyers and small developers to get loans. Some analysts worry that a rapid cooling in China's property market, one of the few strong spots in the world's second-largest economy, may threaten Beijing's plans to manage a gentle slowdown in its economy.