BP rises after $7bn asset sale
Published 21/07/2010 | 10:13
BP rose in London trading after agreeing to sell oil and gas fields in the US, Canada and Egypt to US energy firm Apache for $7bn, raising cash to meet the costs of the Gulf of Mexico spill.
Apache will buy BP’s Permian Basin holdings in Texas and southeast New Mexico and gas properties in western Canada, London-based BP said yesterday after the close of trading.
BP also agreed to sell exploration concessions in Egypt.
BP climbed as much as 3pc to 398.90 pence and traded at 398.70 pence as of 8:40am local time.
The stock has dropped 39pc since the Deepwater Horizon rig exploded on April 20, killing 11 workers and triggering the worst oil spill in US history.
Europe’s largest oil producer by volume said last month it would sell $10bn of assets to raise cash for the $20bn fund demanded by President Barack Obama to compensate victims of the oil spill.
BP also suspended dividend payments and cut investment spending.
BP said Apache will pay a deposit of $5bn in cash on July 30. The total price of $7bn includes $3.1bn for the Permian properties, $3.25bn for assets in western Canada and $650m for the Egyptian assets, according to BP’s statement.
Robert Dudley, the BP executive running the spill cleanup operation, is the front-runner to replace Chief Executive Officer Tony Hayward, who is set to step down in the next 10 weeks, the Times reported, citing unidentified people close to the company.
Hayward has the full support of the board and will stay in his post, a BP spokesman said.