Oil giant BP Plc. (BP: Quote,BP.L) Thursday said it has agreed to sell its 18.36 per cent non-operated interest in the Draugen field in the Norwegian Sea to AS Norske Shell, a unit of Royal Dutch Shell Plc (RDS-A: Quote,RDSA.L,RDSB.L,RDS-B: Quote) for $240 million in cash.
Shell, operator of the field, said the acquisition increases its stake in Draugen field to 44.56 percent from 26.20 percent).
BP, which was affected heavily by the 2010 Macondo well disaster in the Gulf of Mexico, is focusing on high value assets with long term growth potential, while realising the value of non-core assets.
With the latest announcement, BP has now entered into agreements to sell assets valued around $33 billion since the beginning of 2010. BP expects to divest assets worth $38 billion between 2010 and 2013.
BP has been in Norway since 1920. The firm has 15 licences, and is the operator of 11 of these. The fields currently in production and operated by BP Norway include Valhall, Hod, Ula and Tambar.
Rebecca Wiles, managing director of BP Norway, said, "BP is a significant investor in Norway and is in the final stages of completing two major projects, the Skarv field and the re-development of the Valhall field, which will greatly increase our production from the country."
With the start-up of Skarv and Valhall redevelopment, BP's Norwegian production is expected to more than double to over 60,000 barrels of oil equivalent per day.
The Valhall re-development project involves the installation of a new platform, extending production from the field out to 2050.
The Skarv project, involving a new floating production storage and offloading vessel in the Norwegian Sea, is expected to produce for 25 years. It is expected to be a key hub for the company in Norway. Significant investments have been made in Ula and the field is expected to produce until 2028.
Net BP production from Draugen, operated by Shell, averages around 6,000 barrels per day. The deal is expected to be completed by the end of the year.
Monday, BP said it agreed to sell certain of its assets and interests in the deep water U.S. Gulf of Mexico to Plains Exploration and Production Co. (PXP) for a total of $5.55 billion in cash. That deal is expected to close by the end of 2012.
BP.L is currently trading at 439.85 pence, down 1.15 pence or 0.26 percent on 14.01 million shares.
RDSA.L is currently up 0.7 percent at 2,243 pence.
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by RTT Staff Writer
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