BP Sell Gulf of Mexico Oil Fields for $5.55 Billion

Following the Macondo Well oil spill in 2010 BP set itself the target of raising $38 billion in cash through divestitures before the end of 2013, they have just announced the sale of some of their Gulf of Mexico oil fields to Plains Exploration & Production Co. for $5.55 billion.
   
The purchase includes the Marlin, Dorado, King, and Horn Mountain fields, as well as part stakes in various other fields owned by Exxon Mobil and Shell. Plains purchased BP’s 50% stake in the Holstein field, and in a separate deal the other half of the field from Shell for $560 million.

The deal is part of Plains’ plan to increase its output of crude oil, and will provide an estimated 59,500 barrels of oil a day.

John White, and investment manager at Triple Double Advisors LLC in Houston, commented that the deal is “transformational for Plains. The price is in line with other oil deals and may be slightly favourable to Plains.”

He said that this deal now means that BP has raised more than $32 billion from asset sales since early 2010, a large contribution to the $38 billion that it set aside to pay for the spill, and the extra $20 billion trust fund it established for victims.

Jason Gammel, an analyst at Macquarie Capital Europe Ltd, believes that BP “got a good price. We were counting on them getting about $3.5 billion. They’re almost done with their asset sales now.”

By. James Burgess of Oilprice.com