Advertisement

BP sells $7 billion in assets

LONDON, July 20 (UPI) -- BP, the British oil giant facing billions in damages for its Gulf of Mexico spill, said Tuesday it has agreed to sell $7 billion in assets to Apache Corp.

The company said in a release on its Web site it has entered into agreements to sell upstream assets in the United States, Canada and Egypt to the Houston oil and gas producer to bolster its cash reserves. BP is under a U.S. directive to put $20 billion into a fund to finance claims arising from the gulf spill, and there have been estimates the costs could go much higher.

Advertisement

The assets include BP's Permian Basin assets in Texas and New Mexico, its western Canadian upstream gas assets and its Western Desert business concessions and East Badr El-din exploration concession in Egypt.

"Over the last two months the board has considered BP's options for generating the cash necessary to meet the obligations likely to arise from the Gulf of Mexico oil spill," BP Chairman Carl-Henric Svanberg said. "BP has an extremely strong asset base which is diversified geographically as well as by asset class. The board believes that there are opportunities to divest assets which are strategically more valuable to other parties than they are to BP. Today's announcement is the first such transaction and meets the value and strategic criteria of both parties."

Advertisement

BP Group Chief Executive Officer Tony Hayward said the company "achieved an excellent price."

G. Steven Farris, Apache's chairman and chief executive officer, said the deal "provides a sustainable growth platform for Apache's onshore North America operations as well as strategic infrastructure and exploration potential in Egypt."

The cash sales will be completed during the third quarter with a deposit of $5 billion in 10 days.

Latest Headlines

Advertisement

Trending Stories

Advertisement

Follow Us

Advertisement