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Reuters: Glencore seeking $550M to raise stakes in Kurdish oil

Published 11/18/2016, 11:58 AM
Reuters: Glencore seeking $550M to raise stakes in Kurdish oil
GLEN
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GLNCY
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  • Glencore (LON:GLEN) (OTCPK:GLCNF, OTCPK:GLNCY) is seeking to raise $550M through a debt issue guaranteed by oil from Iraqi Kurdistan in an attempt to secure a large piece of the high-risk, high-reward market, Reuters reports.
  • Glencore reportedly plans to enter into a new five-year agreement with the Kurdish government to buy its crude, with deliveries rising from one cargo in January, to two in February-March, four in April and six from May onwards; six cargoes per month would represent 25% of overall exports from Kurdistan and would be worth at least $1.7B/year at today's price of ~$40/bbl for Kurdish oil.
  • The risks of investments linked to Kurdish crude is reflected in the high returns offered in the debt issue, with Glencore's planned five-year note reportedly carrying an interest rate of 12%.


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