BreitBurn Declines After Oklahoma Oilfield Deal: Dallas MoverJim Polson
BreitBurn Energy Partners LP, the Los Angeles-based oil and natural gas partnership, fell after announcing the purchase of $890.2 million of assets in Oklahoma to be funded with debt.
BreitBurn declined 3.1 percent to $17.36 at the close in New York.
Wells to be acquired in the Oklahoma Panhandle produce the equivalent of 7,400 barrels of oil a day, the partnership said today in a statement. The partnership will pay about $860 million to Whiting Petroleum Corp., based in Denver, and $30.2 million to other owners, according to the statement. Bank borrowings will fund the purchases.
The transaction, expected to close July 31, will increase cash available to pay unit holders, supporting BreitBurn’s target to boost the payout by 5 percent a year, according to the statement.
Oil from the fields will sell for $8 a barrel less than the U.S. benchmark and lifting costs, a measure of production expense, will be $18 a barrel, according to the statement.
The agreement includes a 60 percent stake in a pipeline carrying carbon dioxide that’s used to coax oil from the Postle and Northeast Hardest fields, Whiting said in a separate statement.