ExxonMobil Guyana, the local arm of US supermajor ExxonMobil, has acquired the FPSO Liza Destiny from Dutch floater expert SBM Offshore.
ExxonMobil bought the FPSO ahead of the maximum lease term which would have expired in December 2029.
The purchase allows the US supermajor to assume ownership of the unit while SBM Offshore will continue to operate and maintain the FPSO up to 2033.
The transaction comprises a total cash consideration of around $535m. SBM Offshore said the net cash proceeds would primarily be used for the full repayment of the $405m project financing and would decrease the company’s net debt position.
The FPSO Liza Destiny has been on hire at the Stabroek Block offshore Guyana since December 2019. It was converted from a VLCC and is designed to produce up to 120,000 bopd with an associated gas treatment capacity of 170m cfpd, a water injection capacity of around 200,000 bpd and an overall storage volume of 1.6m barrels.
So far, ExxonMobil has acquired two of the four FPSO units built by SBM for its operations in Guyana – the FPSO Unity in 2023 and FPSO Prosperity in early November.
Norway’s Aker Solutions has signed a contract for maintenance and modification services on Vår Energi’s Jotun, Balder, and Ringhorne assets in the southern area of the Norwegian Continental Shelf.
The five-year agreement includes an option for Vår Energi to extend the contract by up to three additional two-year periods.
No precise figure was given for the deal but Aker Solutions stated that the deal was sizeable which puts the value between NOK500m and NOK1.5bn ($44m and $131.5m).
Aker Solutions has been providing maintenance and modification services for Vår Energi’s Jotun, Balder, and Ringhorne assets for more than 20 years. The operator is currently Norway’s second-largest exporter of gas.
The work will be managed from Aker Solutions’ office in Stavanger while fabrication will be carried out at the company’s yard in Egersund. The work under the frame agreement will start in January 2025.
The contract will be booked as order intake in the fourth quarter of 2024 in the life cycle segment.
At the start of the week, Aker Solutions won an extension for a similar contract from compatriot oil and gas firm Aker BP. The contract covers the operated field centres offshore Norway – Valhall and Hod, Ula and Tambar, and Alvheim and Skarv.
Cyprus-based shipowner Castor Maritime has announced its second containership sale. The Nasdaq-listed company is offloading the 2005-built 2,700 teu Gabriela A for $19.3m at a net gain of $0.8m.
Castor picked up the German-built boxship, with charter attached, in a family-related deal from Ismini Panagiotidi-controlled Pavimar Shipping for $25.38m in late 2022 when it made its entry into the containership segment. Delivery to the new undisclosed owner is expected in the first half of 2025.
The sale follows a recently struck $16.5m deal with an unaffiliated third party for the sister vessel Ariana A, for which the company will book a loss of about $3.3m. Castor currently owns 13 vessels, comprising 10 bulk carriers and three containerships, including the duo agreed for sale.
Earlier this month, the Petros Panagiotidis-led company spent nearly $193m to acquire a majority stake in Frankfurt-listed MPC Münchmeyer Petersen Capital (MPC Capital), the founder and cornerstone shareholder of Oslo-listed tonnage provider MPC Container Ships with a fleet of 63 vessels.
US asset management firm EnTrust Global is set to launch a voluntary cash tender offer to take over Norwegian bulker owner Belships.
Blue Northern, a special purpose vehicle formed by funds managed by the Blue Ocean maritime investment team at EnTrust, will offer NOK20.50 per share in cash for all issued and outstanding shares in the ultramax specialist.
The bid values Belships at NOK 5.182bn ($452m), representing a premium of nearly 30% compared to the company’s closing price on Thursday.
Shareholders, involving members of the board and management, who collectively own 61.2% of the outstanding shares in Belships, have already accepted the offer. They include Frode Teigen, the company’s largest shareholder; chairman Peter Frølich; and CEO Lars Christian Skarsgård.
Teigen owns 53.9% of the shares in the Oslo-listed company he took control of six years ago via his investment vehicles Kontrari and Kontrazi.
Belships has 42 bulk carriers on a fully delivered basis, with 12 ultramaxes joining the fleet between 2025 and 2028.
“This acquisition will allow the Blue Ocean team to continue the growth of its maritime investment portfolio through an investment in an attractive and versatile platform with a modern fleet,” said Svein Engh, senior managing director and portfolio manager of EnTrust.
The acceptance period for the offer should start by January 24 next year and remain open for at least 20 business days. EnTrust intends to close the transaction in the first or second quarter of 2025, after which Belships should be delisted from the Oslo Stock Exchange.
Strikes at major Australian ports are set to continue in an ongoing dispute between unionised workers and Qube Ports over contract negotiations.
Work stoppages will take place in Adelaide, Brisbane, Darwin, Gladstone, Melbourne, and Port Kembla.
On Monday, union members went on strike at 10 ports around the country for a day, but they have been sporadically conducting lower-level industrial action throughout Australia since September.
Upcoming industrial actions will affect ports handling bulk goods, including grains, steel, and machinery. Additionally, all participating port workers plan to stage eight-hour stoppages when vessels berth.
Qube’s major coal, grain, and fertiliser operation in Port Kembla in Wollongong is facing 13 rolling work stoppages between December 20 and January 3.
The dispute between the Maritime Union of Australia (MUA) and Qube Ports has been ongoing since contract negotiations broke down in April 2024. The MUA accused Qube of deliberately delaying negotiations and has been calling on the government to intervene and prevent the company from bypassing collective bargaining.
Qube has offered its staff an 18% wage rise over four years but the union is also asking for changes to current rostering rules that let the company determine workers’ shifts at 4pm the day before they begin and fatigue management rules to prevent company managers from allocating dangerous work patterns.
“If the MUA prolongs or expands the scope of the strike, cargo handling delays will likely prompt supply chain disruptions through January,” maritime security consultancy Crisis24 warned.
COSCO Shipping is pressing ahead with its massive newbuilding programme in the dry bulk segment.
The Chinese state-owned shipping giant has partnered up with Everbright Financial Leasing for 10 kamsarmax newbuilds, which will be built at Jiangsu Hantong Ship Heavy Industry.
Financial details and delivery dates for the 82,000 dwt vessels, which will be leased to companies owned by COSCO Shipping Bulk, have not been disclosed.
The latest deal follows COSCO’s largest shipbuilding order for 42 bulk carriers worth over $1.8bn, spread across its affiliated COSCO Shipping Heavy Industry and CSSC Chengxi Shipyard in September and eight newcastlemax newbuildings at Jiangsu Hantong in August.
Swedish police on Thursday boarded the Yi Peng 3, a 23-year-old panamax bulker owned by Ningbo Yipeng Shipping and linked to the severing of two data cables in the Baltic Sea after being invited by Chinese authorities.
The vessel has been wanted for questioning by Sweden as the top suspect in the severing of the Swedish-Lithuanian and Finnish-German fibre-optic cables in November.
Since the incident, it has been anchored in the Kattegat Sea while diplomats in Stockholm and Beijing discussed access to the vessel. Swedish Prime Minister Ulf Kristersson said they requested China’s cooperation in the investigation back in late November but noted that there was no accusation of any sort directed at China.
The Swedish police said in a statement that they were on board the bulker as observers, while Chinese authorities conducted investigations. Danish authorities facilitated the visit. It is understood that representatives from Germany, Finland, and Denmark also boarded the ship.
They also stated that “no investigative measures are carried out” by the Swedish Police Authority while on board the ship.
“The preliminary investigation into sabotage of the two cable breaks in the Baltic Sea continues,” the police authority added.
The preliminary investigation began in November. The police authorities in Finland, Sweden, and Lithuania set up a joint team to investigate the cause of the damage to the cables. The investigation is led by Sweden’s state prosecutor Henrik Söderman of the country’s unit against international and organized crime.
The Swedish Police Authority pointed out that the investigations carried out on the ship on Thursday were not part of the preliminary investigation.
Earlier this week, Norway’s TV 2 and Sweden’s TV 4 revealed underwater footage which further reinforced suspicions of sabotage of the two cables. Underwater drone operations conducted by the television stations and Blueye Robotics revealed a broad, dark drag mark on the seabed where the Yi Peng 3 passed over Danish data cables.
The Census Bureau released its updated population estimates with data through July 2024 today, which corrected its vastly underestimated figure of immigrants for the past few years.
The prior Census Bureau data had so inadequately measured the tsunami of immigrants in 2021 through 2024 that it left policy makers, such as the Fed, in the dark about the supply of labor, employment, etc. To provide some insights, the Congressional Budget Office released its own estimates of population growth earlier this year, by incorporating data from Immigration and Customs Enforcement.
Today’s data by the Census Bureau confirms that it was truly a tsunami of immigrants that washed over the land. And now it’s official.
The US population surged by 8 million people in the three years from July 2021 through July 2024, to 340.1 million, according to the updated estimates from the Census Bureau today.
The 3.3 million net increase over the 12 months through July 2024 was the largest in decades. And the biggest portion of increases came from net-immigration (those that came in minus those that left or were removed):
2022: +1.92 million, incl. 1.69 million net immigration
2023: +2.80 million, incl. 2.29 million net immigration
2024: +3.31 million, incl. 2.79 million net immigration
In terms of the 2.79 million net immigration in the 12 months through July 2024, the Census Bureau said in its note about the improved methodology that this was “significantly higher than our previous estimates, in large part because we’ve improved our methodology to better capture the recent fluctuations in net international migration,” by among other things using “newly available administrative data [including from the Department of State Bureau of Consular Affairs and Refugee Processing Center; and from Homeland Security] to adjust the usually survey-based estimates of foreign-born immigration.”
“Improved integration of federal data sources on immigration has enhanced our estimates methodology,” The Census Bureau said.
In percentage terms, the population increased by nearly 1% over the 12 months through July 2024, the biggest percentage increase since 2001.
Over the three years through July 2024, the population increased by 2.4% (by 8.0 million people):
Coming Up-Revisions of Total Employment & Labor Force.
Early next year, the Bureau of Labor Statistics will incorporate these new population data into its employment-related data obtained from the household survey and substantially revise up its figures for labor force, total employment, and unemployment, and the metrics derived from those.
The household survey data – labor force, employment, unemployment, etc. – has been in the fog for two years due to this large underestimation of the working new arrivals and new arrivals still looking for work.
For the BLS employment data, legal status of the workers is irrelevant. It’s not even part of the data.
The newly arrived immigrants who either already have a job or are looking for a job count in the labor force, regardless of legal status. If they’re working, they count as workers, regardless of legal status. Those that have not found a job yet, but are looking for a job, show up as unemployed regardless of legal status.
So we expect large up-revisions of overall employment, the labor force, unemployment, and related metrics.
But the up-revisions might not move the unemployment rate much since they would largely cancel out in the calculation of the unemployment rate: up-revised number of unemployed divided by up-revised labor force.
The up-revision should re-establish the historic difference between total employment, which is based on the household survey and population data (red line in the chart below) and nonfarm payroll jobs, based on data from establishments (blue).
That long-established and normally fairly stable difference between total employment and nonfarm payrolls is mostly caused by certain self-employed workers and farm workers not being included in nonfarm payrolls, but being included in total employment.
By not adequately accounting for the newly arrived immigrant workers, total employment (red) stopped growing and even declined a little since early 2023, while nonfarm payrolls have continued to rise at a solid pace as employers reported their immigrant workers on the establishment surveys (blue).
The coming up-revision of total employment in the household survey should raise the red line and re-establish the typical difference to the blue line.
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Existing home sales rise from multi-decade rock-bottom, still -34% from 2021, -22% from 2019. Supply highest for November since 2018, days on market highest since 2019.
Sales of existing single-family houses, townhouses, condos, and co-ops that closed in November fell to 315,000 homes, according to data from the National Association of Realtors today. During the holiday period – from November through January – sales always drop from the prior months and reach the yearly low in January, and inventories drop too as people pull their homes off the market over the holidays.
Year-over-year, sales rose by 5.0% not seasonally adjusted, from the collapsed sales that closed in November last year after mortgage rates had briefly hit 8%. But compared to November 2021, sales were down by 37%. That’s the extent of demand destruction brought about by too-high prices.
The seasonally adjusted annual rate of sales, which attempts to iron out the seasonal decline over the holidays and multiplies this out to a 12-month period, rose by 4.8% in November from October to an annual rate of 4.15 million homes. This was still down by 34% from the same period in 2021 and by 22% from 2019, wobbling along the bottom for two years (historic data via YCharts):
Buyers’ strike leads to lowest annual sales since 1995.
The demand destruction in 2024 has been even larger than during the Housing Bust. With today’s actual sales figures for November (not seasonally adjusted), the WOLF STREET estimate for the whole year 2024 comes in at 4.04 million sales, the lowest since 1995, below even the worst years during the Housing Bust.
During the Housing Bust, demand destruction was caused by an economic and financial meltdown that had been preceded by years of reckless mortgage lending that then came home to roost and turned into the mortgage crisis.
But the 2023 and 2024 demand destruction was caused by a gigantic spike in prices – the NAR’s national median price shot up by nearly 50% from June 2019 through June 2022 – and then in 2023, mortgage rates returned to normal-ish levels in the 6%-7% range, up from the pandemic’s free-money range of less than 3% (historical data from YCharts).
Getting used to 6% to 7% mortgage rates.
The real estate industry has now given up on trying to outwait those mortgage rates and is exhorting sellers and buyers to get used to “a new normal of mortgage rates between 6% and 7%,” as the NAR put it today.
These 6% to 7% mortgage rates are of course the old normal mortgage rates that prevailed in the decades before the money-printing era of 2008 through 2021, and they’re unlikely to go back to the pandemic range.
Fannie Mae, the largest Government Sponsored Enterprise that buys and guarantees mortgages, came out earlier this month, encouraging mortgage investors, the real estate industry, home sellers, and home buyers to get used to these 6% to 7% mortgage rates:
“It is unlikely we will again see the low mortgage rates we had during the COVID-19 pandemic,” Fannie Mae wrote in a blog post, adding that “current mortgage rates and Fannie Mae’s forecast for 2025 rates are well in line with rates over the past several decades. Since 1990, the 30-year fixed-rate mortgage has averaged 6%.”
The average 30-year fixed mortgage rate rose to 7.14% today, according to the daily measure by Mortgage News Daily.
Freddie Mac’s weekly measure of the average 30-year fixed mortgage rate rose to 6.72% today.
Mortgage rates track the 10-year but at a higher level, with a spread between them that varies. And the 10-year yield has jumped by nearly 20 basis points to 4.58% since the Fed’s rate cut yesterday.
Mortgage rates have been above 6% since mid-2022. The market might as well get used to this mortgage rates and deal with them – and lower prices, after the ridiculous spike, will bring up the volume.
Before the 2008-2021 money printing era, 5% mortgages had been essentially unheard of:
Highest supply for any November since 2018.
Supply of unsold existing homes on the market, at 3.8 months (red line in the chart below), was the second highest for any November over the eight years 2017 through 2024, behind only 2018 (yellow). And that is plenty of supply.
Unsold inventory dipped to 1.33 million homes in November, as homes got pulled off the market over the holidays and as new listings declined from the prior month, as they always do over the holiday period.
Days on the market keep rising.
The median number of days before the home is either sold or pulled off the market because it failed to sell rose to 62 days in November, the most for any November since 2019, and up from 52 days a year ago, according to data from Realtor.com.
This is in part a measure of how motivated sellers are by letting their home sit on the market when it doesn’t sell right away.
Prices are way too high.
The median price of single-family houses edged down in November to $410,900, with the past three months in roughly a holding pattern, in line with pre-pandemic seasonality over those months through December. This seasonal pattern is usually followed by a big drop in January. Year-over-year, the price was up by 4.8%.
In the three years between June 2019 and June 2022, this national median price had exploded by nearly 50%, on top of the large price gains in prior 10 years, and this — driven at the time by the Fed’s interest-rate repression and money-printing schemes — has become the #1 problem in the housing market today:
The median price of condos and co-ops dipped to $359,800 in November, for a year-over-year gain of 2.8%. Unlike single-family house prices, the median condo price didn’t experience any outright year-over-year declines in mid-2023.
But home prices vary widely by metro. They have been dropping in some metros since 2022, but continued to rise in other metros through the summer, with declines now getting started in metros even where prices are not seasonal, based on Zillow’s “raw” mid-tier home price index. The two bookends of our series covering 33 markets, The Most Splendid Housing Bubbles in America, show the divergence, with Austin prices having plunged by 22% from the peak in mid-2022, while prices in the New York City metro eked out gains through October before seeing the first dip:
Demand destruction by region.
The charts below show the seasonally adjusted annual rate of sales, released by the NAR today, in the four Census Regions of the US. A map of the four regions is in the comments below the article.
Northeastern US: The seasonally adjusted annual rate of sales rose to 510,000 homes:
Midwestern US: The seasonally adjusted annual rate of sales rose to 1,000,000 homes.
Southern US: The seasonally adjusted annual rate of sales rose to 1,870,000 homes.
Western US: The seasonally adjusted annual rate of sales unchanged at 770,000:
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When a solar energy developer approached Halifax County, North Carolina, in the early 2010s about renting its former airfield in Roanoke Rapids, community leaders had a condition.
“If they were willing to lease this land for the very first solar project in the area, the county needed to get something back in return,” said Mozine Lowe from her office, which overlooks the 20 megawatt solar farm now atop the old airport. “What they got was this building.”
Of course, it’s more than a building. It’s the headquarters for the Center for Energy Education, the nonprofit Lowe has run since 2016 that works to maximize the benefits of large solar farms in rural America — one community, one school child, and one worker at a time.
Lowe, who grew up about five miles from where she now works, had graduated from Greensboro’s North Carolina Agricultural and Technical State University but worked across the country, from California to Washington, D.C.
When she returned to this rural county of less than 50,000 near the Virginia border, formerly a hub of farming and textiles, she said she didn’t see a lot of change.
“The jobs were the same,” she said. “I didn’t see people making the connection between solar energy and what’s happening with the climate and the impact on rural communities, and I just wanted to try and help from that angle.”
The Center conducts educational programs for children of all ages, who come in by the busload from surrounding schools both public and private. It holds a Solar Fest every year to celebrate clean energy with community leaders, drawing hundreds.
Through collaborations with local educational institutions like community colleges, the center has also helped to train a new workforce in jobs that pay roughly twice what workers are earning at the fast-food chains off Interstate 95.
“We have trained more people than most other people around here to become solar installers,” Lowe said. “We want them to be first in line for our jobs.”
And there’s outreach to solar companies themselves in North Carolina as well as Kentucky, Ohio, and Indiana, where the Center also has offices. The goal is to help them become better community partners.
The Center for Energy Education staff. Credit: Elizabeth Ouzts
Geenex, the Charlotte-based developer who built the solar farm at the airport and over a dozen others in the vicinity, is still involved in the Center, and the company’s chairman also chairs the nonprofit’s board.
But Lowe and other staff at the organization say not every solar developer is committed — at least at first — to working with community leaders in Eastern North Carolina.
“Geenex is a very good partner,” said Reginald Bynum, the Center’s community outreach manager. “They’re a good player. But there are only a few of them. Other companies will say, ‘This is your ordinance? Great. This is all I have to do.’”
Some county ordinances, like that in Halifax, need to be updated, Bynum said. Many still call for a 75-foot buffer between the rows of solar panels and neighboring properties. That figure is “so 2018,” said Bynum. It should be doubled, he said.
Most solar farms are also built on private land — often bits of farmland that can help cotton growers and other farmers guarantee income. But developers usually obtain the leases first, before airing the project in public.
“That’s the backwards process of solar,” Bynum said. “They’re talking to landowners and securing that land, and then they’re coming to commissioners.”
What’s more, simply following ordinances isn’t enough, Bynum says. What’s needed is for solar developers to work with local residents to develop community benefits agreements – documents that memorialize pluses to the area, from minimizing construction impacts to providing jobs.
“It’s a 30-year commitment to the community,” he said, “because your farm’s going to be here 30 years. They’re asking for that, and they deserve that.”
Critically, say Bynum and other advocates, solar developers need to work with community leaders to provide benefits beyond tax revenue — an undeniable good, but one that isn’t “seen” by anyone except county bookkeepers.
And though a recent study from the North Carolina Sustainable Energy Association shows that solar farms today take up a fraction of a percent of the state’s farmland, the figure is a full 1% in Halifax County, and on pace to triple in the coming years, according to the Center’s research.
“From rural citizens’ standpoint, that’s a lot,” Bynum said. “You have to really understand what they’re seeing.”
A solar array amid trees and a cotton field in Halifax County, North Carolina. Credit: Elizabeth Ouzts
Part of what they’re seeing is the result of a simple fact: solar farms aren’t just growing more abundant in parts of rural America. They’re also much larger.
In North Carolina up until 2016, the average utility-scale solar development was 5.8 megawatts covering 35 acres of land, per the Sustainable Energy Association. After a 2017 state law made larger solar farms easier to build, the average system size increased to 13.6 megawatts and covered 115 acres of land.
“Projects have gotten bigger,” said Carson Harkrader, the CEO of Durham-based Carolina Solar Energy, who appeared on a recent clean energy panel with Bynum. “As they’ve gotten bigger, people freak out a little bit.”
And while many folks’ worries about the visual impact of solar panels can be mollified — with tree buffers, setbacks, and information about the safety of the structures — some are easy targets for opponents.
“The opposition has become much, much, more organized. There are national groups, funded by the oil and gas industry,” Harkrader said. “With this opposition that is more organized and has more resources, it’s much harder.”
In some cases, opponents may fill a vacuum left by solar companies who lined up projects before the pandemic and have only recently begun to start construction.
That’s what happens, said Bynum, “when you miss steps in keeping citizens updated with the project — particularly when you started talking about it five years before. Commissioners change, a lot of tribal knowledge evaporates.”
And sometimes, it only takes one or two community members to force the issue with local politicians. Both neighboring Northampton and Halifax counties have passed moratoriums on new solar farms recently. Halifax acted after just a few people appeared at their meeting, concerned about the loss of trees.
Having talked with county commissioners, staff at the Center are hopeful the moratorium will end quickly as planned, after the county has updated its ordinance. But the “pause” on solar farms is an example of the constant game of whack-a-mole solar developers and their advocates must play.
Lowe says that’s why the Center is so vital.
“What makes us unique is that our work is mainly community engagement,” she said. “Our stance is to be neutral, and to provide factual information. I think we need to tell more success stories.”
