The fighting in Libya is likely to have long-term implications for OMV, the Austrian oil and gas company in which Abu Dhabi's International Petroleum Investment Company (Ipic) owns a 20 per cent stake.
The company was downgraded from "buy" to "hold" by ING bank yesterday.
"We believe OMV is likely to lose all of its 300,000 barrels of oil equivalent a day of Libyan production capacity for months, if not years," wrote Tamas Pletser, an ING analyst in Budapest. "Unrest in Yemen risks further losses."
The Austrian company, whose businesses span crude refining to car washing, is heavily exposed in North Africa as well as in Yemen, where it holds three exploration and production licences.
Shares of OMV on the Vienna Stock Exchange yesterday rose slightly to €30.89 in early trading.
Olena Kyrylenko, an energy analyst with KBC Securities in Hungary, said last month a total production shutdown in Libya could cost the company US$500,000 a day.
One of the top producers in the embattled country, OMV had as recently as 2008 extended some of its 12 exploration and production contracts to 2032.
The company, which this year spent $866m to buy a Tunisian exploration and production company, should consider issuing more stock, said Mr Pletser.
"The company has been unable to make financing decisions to ease its debt burden, creating further uncertainty," he wrote in a note to investors, adding that an equity issue would allow the company to raise capital without jeopardising its favourable credit rating.
If OMV were to pursue the option, Ipic would have to put up more cash to maintain its stake.
Abu Dhabi has cultivated a close relationship with OMV, the biggest refiner and marketer in central Europe, to secure western crude markets and take advantage of downstream expertise. OMV and Ipic together own Borealis, the Austrian petrochemicals maker that has lent technical and marketing know-how to Abu Dhabi's local petrochemicals firm, Borouge.
ayee@thenational.ae
From Zero
Artist: Linkin Park
Label: Warner Records
Number of tracks: 11
Rating: 4/5
Milestones on the road to union
1970
October 26: Bahrain withdraws from a proposal to create a federation of nine with the seven Trucial States and Qatar.
December: Ahmed Al Suwaidi visits New York to discuss potential UN membership.
1971
March 1: Alex Douglas Hume, Conservative foreign secretary confirms that Britain will leave the Gulf and “strongly supports” the creation of a Union of Arab Emirates.
July 12: Historic meeting at which Sheikh Zayed and Sheikh Rashid make a binding agreement to create what will become the UAE.
July 18: It is announced that the UAE will be formed from six emirates, with a proposed constitution signed. RAK is not yet part of the agreement.
August 6: The fifth anniversary of Sheikh Zayed becoming Ruler of Abu Dhabi, with official celebrations deferred until later in the year.
August 15: Bahrain becomes independent.
September 3: Qatar becomes independent.
November 23-25: Meeting with Sheikh Zayed and Sheikh Rashid and senior British officials to fix December 2 as date of creation of the UAE.
November 29: At 5.30pm Iranian forces seize the Greater and Lesser Tunbs by force.
November 30: Despite a power sharing agreement, Tehran takes full control of Abu Musa.
November 31: UK officials visit all six participating Emirates to formally end the Trucial States treaties
December 2: 11am, Dubai. New Supreme Council formally elects Sheikh Zayed as President. Treaty of Friendship signed with the UK. 11.30am. Flag raising ceremony at Union House and Al Manhal Palace in Abu Dhabi witnessed by Sheikh Khalifa, then Crown Prince of Abu Dhabi.
December 6: Arab League formally admits the UAE. The first British Ambassador presents his credentials to Sheikh Zayed.
December 9: UAE joins the United Nations.
Business Insights
- As per the document, there are six filing options, including choosing to report on a realisation basis and transitional rules for pre-tax period gains or losses.
- SMEs with revenue below Dh3 million per annum can opt for transitional relief until 2026, treating them as having no taxable income.
- Larger entities have specific provisions for asset and liability movements, business restructuring, and handling foreign permanent establishments.
Nayanthara: Beyond The Fairy Tale
Starring: Nayanthara, Vignesh Shivan, Radhika Sarathkumar, Nagarjuna Akkineni
Director: Amith Krishnan
Rating: 3.5/5
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UAE currency: the story behind the money in your pockets