BP seeking $7.9 bln for Gulf of Mexico oil fields

A security guard keeps watch during the open ceremony of Thai energy firm PTT's sixth Gas Separation Plant near the town of Map Ta Phut in Rayong province, east of Bangkok in this September 7, 2011 file photo. (REUTERS/Sukree Sukplang/Files)

BP Plc is seeking as much as $7.9 billion before tax payments for a group of Gulf of Mexico oil fields as it unloads assets following its 2010 spill in the region, two people with knowledge of the matter said.

The oil producer, Europe’s biggest after Royal Dutch Shell Plc, has prepared preliminary information for prospective buyers of assets including the Horn Mountain, Holstein, Diana Hoover and Ram Powell fields, said the people, who asked not to be identified because the sale process is confidential.

Because of taxes payable by the eventual buyer, the maximum proceeds BP can expect from the fields will probably be $5 billion to $6 billion, one of the people said.

The fields, which hold proven reserves of about 120 million barrels of oil, produced about 58,000 barrels a day in the first quarter, the person said.

BP rose as much as 1.1 percent and traded up 0.6 percent at 449.40 pence as of 3:15 p.m. in London.

Chief executive officer Bob Dudley plans to sell $38 billion of assets by the end of next year, shrinking BP after the accident at its Macondo well, the worst offshore spill in U.S. history, wiped out a third of its market value. The London-based company said in May that it planned to sell some “non- strategic” assets in the Gulf.

“We’re progressing the planned divestments” in the region “to really focus our Gulf of Mexico footprint,” Dudley said on July 31.

Robert Wine, a BP spokesman, declined to comment on details of the sale Tuesday.

BP’s output in the Gulf of Mexico is some of the most profitable in its portfolio, and Dudley has said he wants to focus more on the production hubs of the Thunder Horse, Atlantis, Mad Dog and Na Kika fields. The company has six rigs working in the region and plans to have eight by the end of the year, the most ever. Competitors including Norway’s Statoil ASA are also looking to expand in the region, which offers relatively low taxes and easy access to the U.S. energy market.

Two of the fields being sold by BP, Holstein and Horn Mountain, are already operating, and two are still in development, the sources said. Bidders are likely to include U.S. companies such as Chevron Corp. and ExxonMobil Corp., and it’s unlikely that all the fields will go to one buyer, one of the sources added.

A version of this article appeared in the print edition of The Daily Star on August 15, 2012, on page 6.




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