The Magician’s Memorial - Chapter 382



Only Krnovel

382. War and war (2)

Oil prices continued to decline for two consecutive months.

Oil prices had already fallen to the $80 level, and it had a huge impact on Taewoo Group.

The planning director brought a report summarizing the impact of low oil prices on each affiliate.

“Due to the fall in oil prices, our export-specialized affiliates are benefiting greatly. Due to low oil prices, transportation costs for automobiles, semiconductors, and electronics industries have fallen significantly, leading to an increase in profits.”

“There are probably some affiliates that are losing money.”

“Taewoo Oil is suffering the most damage. And due to the drop in oil prices, sales of electric vehicles are slowing down, and sales of internal combustion engine vehicles are increasing.”

Taewoo Refinery controlled half of the Korean oil refining market.

We had no choice but to be hit by the biggest oil fraud in Korea.

And it was clear that the natural gas power plant being built by Taewoo Refinery would also be greatly affected.

“The price of natural gas has also fallen a lot, so natural gas power plants will benefit.”

“We have been able to operate the power plant at about 70% of the cost we initially expected. However, due to the drop in oil prices, the cost of thermal power plants has also fallen, so we cannot see that it is a huge benefit.”

In any case, it meant that electricity could be produced cheaply.

There was nothing bad about Taewoo Group, which uses a huge amount of electricity in dozens of factories.

“The era of low oil prices is definitely good for business. You can operate factories at low cost, and transportation costs are reduced, so profits increase even if you stay still.”

“Taewoo Group is benefiting from being an export-oriented company.”

“The era of low oil prices will continue for the next few years. Please help each affiliate so that it can keep pace with the era of low oil prices.”

“I will.”

After finishing the report, the planning director went out.

A CEO who was waiting came inside, touching the baton.

“Oil prices are falling faster than expected. At this rate, I think we will have to expedite the Chairman’s trip to the United States.”

“Oil prices are certainly moving faster than expected.”

Oil prices fell faster than before the regression.

Could this situation have been created because I invested a huge amount of money in shale gas development?

“And the United States is said to be imposing sanctions on high-ranking Venezuelan officials.”

“Sanctions are finally starting. Venezuela will not accept these sanctions. In fact, it will oppose them even more strongly.”

“There is even talk of special promotion for high-ranking officials who have already been sanctioned.”

“If this kind of exchange continues, the United States will end up imposing economic sanctions on Venezuela.”

Venezuela has now crossed a river of no return.

It would become the fastest-falling country in history, and the money escaping from Venezuela would be absorbed by Taewo Group and Financial Tower.

“American oil companies are also said to be pulling out of Venezuela.”

“It’s moving faster than you think. We haven’t even imposed economic sanctions yet.”

“The drop in oil prices is so severe that they seem to be taking a step back. They are withdrawing and suspending oil exploration activities not only in Venezuela but also in neighboring countries.”

Oil called black gold.

However, today’s oil was not treated as copper, let alone gold.

In this situation, you probably don’t want to spend money on oil exploration, which costs a huge amount of money.

In particular, oil exploration was similar to a lottery.

Exploration did not guarantee success, and oil fields could be found only by relying on probability and digging in many places.

However, since the winnings were decreasing, there was no need to buy a lottery ticket.

“That’s very good. If they stop exploring, it would mean that the oil companies are in a bad financial situation.”

“It is basic to see a deficit, and the debt ratio is also increasing rapidly.”

“This is a perfect situation for an acquisition.”

“Are you looking to acquire an American oil company? Oh! You’re talking about acquiring Cheshire Peak. You have a contract with us, so you can acquire it at a very low price.”

We have been working on acquiring Cheshire Peak for several years.

That’s why, when the words ‘acquisition of an oil company’ came out of my mouth, he thought of Cheshire Peak.

“When this opportunity comes, we can’t just acquire one company. We have to acquire HESS as well.”

“To acquire Hess, we need at least $25 billion. That’s $25 billion because its value has decreased due to falling crude oil prices.”

“Since debt must be included, about $30 billion would be enough to acquire it.”

“It would take more than $50 billion to acquire Cheshire Peak and Hess.”

“I remember you said you were making bold investments. At that time, the CEO even said that you would work hard to make money.”

50 billion dollars was an amount well over 60 trillion won.

Even for Taewoo Securities, which had made huge profits from the oil war, $50 billion was bound to be quite burdensome.

“We could raise $50 billion, but that would leave us with no military funds to fight future oil wars.”

“How about joining hands with a fintech bank and making an acquisition?”

“It is possible if we each share 50% of the shares. Half, or about $25 billion, can be generated as spare funds.”

“We are not going to proceed with the acquisition right now. We plan to make a move when the oil company’s stock price falls further.”

“We will aggressively short sell and cut the stock prices of Cheshire Peak and Hess in half!”

He was a president with sparks flying out of his eyes.

How much would your hands tremble when you heard that your hard-earned money was being taken away?

That’s why he was willing to risk his life by short selling to save even a penny.

“If crude oil prices continue to fall, both Cheshire Peak and Hess will actively seek to sell the company.”

“I understand Cheshire Peak because they have a deep relationship with us, but I don’t understand why they want to acquire Hess.”

“Because Hess has the assets I want.”

“Hess has no assets other than those related to offshore oil fields.”

“What I want is marine oilfield assets. To be precise, I need shares in marine oilfields.”

Offshore oil exploration really costs a lot of money.

Therefore, several oil companies often joined hands in exploration, and often divided the shares according to the amount invested.

“Then is there really a need to acquire Hess? Just acquiring a stake in an offshore oil field can significantly reduce the amount of money spent.”

“There is an underlying belief that the Hess acquisition was a loss.”

“The chairman told me that the era of low oil prices will continue for several years. So won’t the stock prices of oil companies also continue to fall for several years?”

“Ultimately, it’s a cycle. If you acquire a company in a down cycle, you can sell it back in a up market.”

Hess was now worth $25 billion.

However, it was also a company whose value would at least double when the upturn came a few years later.

“Are you planning to sell Hess without your offshore oil field shares in a rising market?”

“If a good opportunity comes, it will happen. You can at least double your business, so don’t think of it as a loss. And even if you can just bring in the offshore oil field shares, it will be more than worth the money.”

A president nods his head with difficulty.

Since he was making money by short selling oil companies every day, he would not have been able to easily accept my words.

“By the way, which offshore oil field do you want?”

“The Guyana Fund is my goal.”

“Are you talking about Guyana, which is right next to Venezuela? There has never been any mention of any useful oil fields being discovered there.”

“It’s a country right next to Venezuela, which is overflowing with oil. So wouldn’t there be some good oil fields if we just look for them?”

Guyana Fund.

Multinational oil companies shared the shares, and Hess held a 30% stake.

“It’s been several years since exploration began, but we haven’t discovered a good oil field yet. It’s too risky to spend $25 billion on chance.”

“Don’t worry, you can make money just by selling Hess in a rising market. And there will definitely be a huge oil field in Guyana. I believe that.”

There is not much time left for Guyana’s oil fields to be discovered.

Therefore, we had to increase our stake as much as possible within this year.

If the timing is late, no one will want to put up their stake.

“Okay. Then, we will try to raise as much money as possible to acquire Hess.”

“It’s not over yet. We will also acquire some of the shares held by ExxonMobil. We also need to acquire the shares held by Chinese oil companies.”

“What percentage of shares do you plan to acquire?”

“Shouldn’t it be at least 60%? If we acquire Hess, 30% will come automatically, so wouldn’t we be able to quickly fill up to 60% by taking just 5% from other companies?”

There was a CEO who couldn’t keep his mouth shut when he heard that the stake was 60%.

Then he bowed his head politely and went outside.

I could see from his back that he had a strong will to earn even a penny more.

* * *

By mid-October, oil prices had fallen to the $70 level.

There wasn’t much left to reach the goal I had set, and I was making plans for a business trip to the United States within the next month.

However, due to the visit of U.S. Ambassador Kang Jun-yong, the schedule for the U.S. business trip had to be changed.

“How have you been?”

“Life in Korea wasn’t bad, but the situation in the U.S. wasn’t so good, so I wasn’t doing well.”

Ambassador Kang Jun-yong suddenly contacted me asking to meet.

When I met him at Captain Kang’s restaurant, he appeared with a low attitude from the beginning.

The fact that the U.S. ambassador, who has tremendous power, appeared in such a low manner meant that he had a favor to ask.

“If you have anything to ask of me, please feel free to ask. I am always open to Ambassador Kang.”

“He wants to meet Chairman Kim at the White House.”

“Why are you suddenly calling me out? Did Taewoo Group cause some kind of problem?”

I deliberately pretended not to know.

At this point, the White House had only one reason to call me.

There was no reason to call me other than to ask for help with the oil war.

“I don’t know if you know, but several small and medium-sized shale companies have gone bankrupt.”

“Because OPEC is excessively increasing oil production, small and medium-sized companies may not have the stamina to withstand it. But shouldn’t large companies be able to withstand enough?”

“The situation is more serious than we thought. Starting next year, many large shale companies are also expected to file for Chapter 11.”

Chapter 11.

In Korean terms, it could be seen as court receivership.

To put it more simply, it meant filing for bankruptcy protection because the debt could not be met.

This was proof that shale companies were suffering great damage due to the oil war.

“Filing for Chapter 11 is not necessarily a bad thing. Wouldn’t it be an opportunity to sort out the chaff and nurture only the good ones?”

“The problem is that there are too many sweethearts. The U.S. government cannot protect all of them.”

“Are you hoping that Taewoo Group will take over some of the shale companies?”

“If a complete acquisition is difficult, we hope to acquire at least a partial stake.”

I tried to take it away, but America was the first to give it to me.

If we could get help from the U.S. government, the acquisition could have been made much cheaper and on better terms.

“I will look at it positively. And I will go to the United States within this week to hear the White House’s thoughts directly.”

“Thank you. I am truly grateful that you responded so positively to my sudden request.”

You are welcome.

I was the one who was grateful.

Because I was provided with an opportunity to steal only the real money.