BP Plc, seeking to raise funds to pay compensation for the Gulf of Mexico oil spill, agreed to sell fields in Colombia to Ecopetrol SA and Talisman Energy Inc. for $1.9 billion in cash.
Colombia’s state oil company will take 51 percent of BP’s production, exploration and transportation business in the South American country and Canada’s Talisman the rest, BP said in a statement. They will pay a $1.25 billion deposit and the remainder on completion. The assets produce the equivalent of about 25,000 barrels of oil and gas a day, BP said.
BP Chairman Carl-Henric Svanberg said last week that the company will triple its planned asset sales to as much as $30 billion to meet the cost of the spill. The company sold $7 billion of assets in the U.S., Canada and Egypt to Apache Corp. It also plans to sell holdings in Venezuela, Pakistan and Vietnam, and may divest part of its stake in Prudhoe Bay, Alaska, or in Pan American Energy LLC in Argentina.
“It seems like they’re chipping away at their target,” said Dougie Youngson, an analyst at Arbuthnot Securities Ltd. in London. “South America is a region they want to scale back on. Pan American may be the next to go.”
BP is said to be considering the disposal of its 60 percent holding in Pan American, Argentina’s second-largest oil producer, according to people with knowledge of the matter. China’s Cnooc Ltd., the largest offshore oil producer, may be a bidder for the stake after it acquired 20 percent when it agreed in March to pay $3.1 billion for half of BP’s partner, Bridas Corp. The transaction values BP’s stake at more than $9 billion.
BP received about $19 a barrel of proved reserves in the Apache deal last month. That price level would put the total value of BP’s assets at about $350 billion, Chief Executive Officer Tony Hayward said last month. Robert Dudley, who will succeed Hayward on Oct. 1, said on July 27 that the company will look to sell assets in which buyers value them higher than BP.
“I am delighted with the price we achieved for these assets,” Hayward said in the statement today. “It now makes sense for these assets to go to owners more willing than BP to invest in their future development.”
BP’s Colombia assets have about 60 million barrels of oil equivalent in proved reserves. The purchase includes BP’s stake in the Cusiana field in northeastern Colombia, its share in rights to explore in blocks in the Caribbean Sea and stakes in pipelines including Oleoducto Central SA that carries oil to the nation’s northern coast, Bogota-based Ecopetrol said today in a statement.
Ecopetrol paid $20.15 per barrel for BP’s proven and probable reserves, more than the $9 per barrel it paid in May 2009 when completing its purchase of Hocol Petroleum Ltd., said Rupert Stebbings, head of the Medellin-based unit of Chilean brokerage Celfin Capital SA.
“It’s probably a bit expensive,” Stebbings said by telephone. “I’d guess BP got a pretty good price.”
Ecopetrol may be betting that exploration will uncover new oil and natural gas reserves in northeastern Colombia and in offshore blocks as it seeks to increase production, Stebbings said. Ecopetrol plans to invest $80 billion through 2020 to more than double daily output to 1.3 million barrels of crude.
Ecopetrol shares jumped 100 pesos, or 3.2 percent, to 3,245 pesos at 12:59 p.m. in Bogota, the largest one-day gain since Sept. 15. The stock has increased 31 percent this year, outpacing a 15 percent rally by Colombia’s Colcap stock index.
BP rose 2.55 pence to 415.65 pence at 4:35 p.m. in London. Barclays Capital, a unit of Barclays Plc, was the sole adviser to BP on the transaction.