NEW YORK—BP Plc, the embattled British oil and gas giant, is reportedly in talks to sell more than $12 billion worth of assets, including a valuable stake in Alaska’s Prudhoe Bay oil field, to U.S.-based Apache Corp.
The news was first reported by London’s Sunday Times, which stated that Apache approached BP a few weeks ago about a possible sale. Currently, the companies are negotiating the terms and structure of a possible deal.
The newspaper did not name a source for its information. Apache, which is based in Houston, Texas, has about $30 billion in market capitalization. The company has operations in the United States, Canada, Egypt, Australia, and Argentina according to its website. Apache did not respond to an inquiry for comment.
Apache’s shares closed up 48 cents to $87.88 last Friday.
A sale would likely help BP raise money to pay for damages resulting from the April 20 explosion at the Deepwater Horizon leased oil rig, which triggered a massive oil spill that the company has attempted to control.
As of last week, BP said that oil cleanup efforts have cost the firm $3.1 billion.
BP last month, after its officials met with the Obama administration, agreed to set up a $20 billion independently administered fund to help pay for litigation liabilities arising from the oil spill from individuals, businesses, environmental groups, and governments.
The Prudhoe Bay oil field is the largest in the United States, located at Alaska’s North Slope region. Operations at the oil field are operated by BP.
In early 2006, a pipeline rupture caused an oil spill in Prudhoe Bay, which caused more than 250,000 gallons of crude oil to spill into the region. The U.S. government ordered an investigation into oil pipelines in the region and found that some lines were corroded and in disrepair. BP later corrected the issues.
Takeover Speculation
Since the oil spill in late April, BP has seen its market capitalization—at the time it was the most valuable British company—tumble more than 50 percent, leading some analysts to speculate that the company may be ripe for a takeover by rivals.
According to a Guardian report, oil giant ExxonMobil was told by the U.S. federal government that it would not stand in the way of a potential takeover by the U.S. firm. A merger of BP and ExxonMobil would create the world’s largest integrated oil and gas firm by a wide margin.
ExxonMobil on Sunday declined to comment on the report.
For its part, BP has been actively seeking investments. Last week, chief executive Tony Heyward was in Abu Dhabi to drum up support from sovereign wealth fund investors about a possible equity stake, including that from Kuwait and Abu Dhabi.
Kuwait’s sovereign wealth fund currently own 1.75 percent of BP.
Outside of the previously discussed sales, the Sunday Times said that BP may also be in discussions with China National Offshore Oil Company (CNOOC) about selling a portion of ownership in an Argentinean oil and gas exploration firm.
The news was first reported by London’s Sunday Times, which stated that Apache approached BP a few weeks ago about a possible sale. Currently, the companies are negotiating the terms and structure of a possible deal.
The newspaper did not name a source for its information. Apache, which is based in Houston, Texas, has about $30 billion in market capitalization. The company has operations in the United States, Canada, Egypt, Australia, and Argentina according to its website. Apache did not respond to an inquiry for comment.
Apache’s shares closed up 48 cents to $87.88 last Friday.
A sale would likely help BP raise money to pay for damages resulting from the April 20 explosion at the Deepwater Horizon leased oil rig, which triggered a massive oil spill that the company has attempted to control.
As of last week, BP said that oil cleanup efforts have cost the firm $3.1 billion.
BP last month, after its officials met with the Obama administration, agreed to set up a $20 billion independently administered fund to help pay for litigation liabilities arising from the oil spill from individuals, businesses, environmental groups, and governments.
The Prudhoe Bay oil field is the largest in the United States, located at Alaska’s North Slope region. Operations at the oil field are operated by BP.
In early 2006, a pipeline rupture caused an oil spill in Prudhoe Bay, which caused more than 250,000 gallons of crude oil to spill into the region. The U.S. government ordered an investigation into oil pipelines in the region and found that some lines were corroded and in disrepair. BP later corrected the issues.
Takeover Speculation
Since the oil spill in late April, BP has seen its market capitalization—at the time it was the most valuable British company—tumble more than 50 percent, leading some analysts to speculate that the company may be ripe for a takeover by rivals.
According to a Guardian report, oil giant ExxonMobil was told by the U.S. federal government that it would not stand in the way of a potential takeover by the U.S. firm. A merger of BP and ExxonMobil would create the world’s largest integrated oil and gas firm by a wide margin.
ExxonMobil on Sunday declined to comment on the report.
For its part, BP has been actively seeking investments. Last week, chief executive Tony Heyward was in Abu Dhabi to drum up support from sovereign wealth fund investors about a possible equity stake, including that from Kuwait and Abu Dhabi.
Kuwait’s sovereign wealth fund currently own 1.75 percent of BP.
Outside of the previously discussed sales, the Sunday Times said that BP may also be in discussions with China National Offshore Oil Company (CNOOC) about selling a portion of ownership in an Argentinean oil and gas exploration firm.
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