glencore international plc (805) Snapshot

Caracal Energy Inc. announced that it completed a previously disclosed Farm-in Agreement with GlencoreXstrata plc for the 25% farm-in for the development of the Badila and Mangara oil fields in Chad. Under the terms of the Agreement, Glencore will earn a 25% working interest in the Badila and Mangara Exclusive Exploitation Authorizations (EXAs) with Caracal Energy retaining a 50% working interest. Under the terms of a separate agreement between Glencore and Société des Hydrocarbures du Tchad (SHT), Glencore has acquired a further 10% working interest in the EXAs, with SHT retaining the remaining 15% working interest. Glencore, in consideration for acquiring the working interest in Badila and Mangara from Caracal, will fund $300 million of Caracal Energy's working interest share of joint venture expenditures in the Badila and Mangara oil fields up to a maximum of $100 million per year. The effective date of the Agreement is July 1, 2012. Under the terms of the EXAs, Caracal Energy and Glencore are required to fund SHT's costs, which are reimbursed through cost oil. Pursuant to the Agreement, Glencore acquired a 33.3% working interest in the Exclusive Exploration Authorizations (the EEA's) granted under each of Caracal Energy's three production sharing contracts in the Republic of Chad (PSCs). In consideration for the assignment of the working interest, Glencore paid to Caracal Energy approximately $31 million on closing, representing 33.3% of the Company's unrecoverable costs related to the three PSCs as of July 1, 2012. The three PSCs cover an area of 26,103 km2 in southern Chad. The Badila and Mangara oil fields have a combined size of approximately 100 km2 and are located within 95 kilometres of each other within the same PSC. The Badila oil field covers an area of approximately 29 km2 and is located approximately 16 kilometres from an oil export pipeline. The Mangara oil field covers an area of approximately 71 km2 and is located approximately 111 kilometres from the same oil export pipeline.

Glencore Xstrata plc announced the signing of revolving credit facilities for a total amount of USD 17,340 million. The Facilities are for general corporate purposes and replace the previous revolving credit facilities of both Glencore and Xstrata plc. The Facilities were initially launched at USD 12 billion and closed substantially oversubscribed, raising in excess of USD 19 billion, due to strong support from Glencore's broad and deep group of relationship banks. A total of 80 banks have committed to the Facilities, including 29 Mandated Lead Arrangers and Bookrunners. The Facilities comprise: a USD 5,920 million 12-month revolving credit facility with a 12-month term-out option and a 12-month extension option. The facility has two tranches of USD 3,515 million and USD 2,405 million. A USD 7,070 million 3-year revolving credit facility with two 12-month extension options. A USD 4,350 million 5-year revolving credit facility.

Indicative bids for Coal & Allied Industries Ltd. are due during the week ending June 14, 2013. Rio Tinto plc (LSE:RIO) will start sifting through prospective bids for 29% of its 80% in Coal & Allied, which is quietly up for sale as the miner seeks to raise cash and pay down debt. Deutsche Bank is believed to be running the process, along with Rio's Clermont coal mine in Queensland. The and possible frontrunner is Shenhua International Limited (ASX:SHU). Marubeni Corporation (TSE:8002) and Coal India Limited (BSE:533278) are reportedly interested in the asset. New Hope Corporation Limited (ASX:NHC) has a $1.5 billion war chest and is one of the best-funded potential buyers of any coal asset in Australia - though New Hope seems unlikely to be interested in a stake where it has little control. Glencore Xstrata plc (LSE:GLEN) has been touted as a bidder given its existing coal mines in the region, while there are serious questions over funding. Expectation from the buy-side is that the stake could be worth $1 billion (or less). Although the process could always be another New Hope and peter out as the negotiations get real.