BP Sells Mexican Gulf Assets to Japanese Group

Oct. 25, 2010
The cash deal comes as BP looks to sell up to $30 billion of assets by the end of 2011 to help meet its financial obligations from the Gulf of Mexico oil spill.

BP is selling its interests in four Gulf of Mexico deepwater fields to Marubeni Oil and Gas of Japan for $650 million just months after acquiring them, the company said on Oct. 25.

The cash deal comes as BP looks to sell up to $30 billion of assets by the end of 2011 to help meet its financial obligations from the Gulf of Mexico oil spill.

BP acquired the interests in the four fields -- Magnolia, Merganser, Nansen and Zia -- from US group Devon Energy in March as part of a wider acquisition of assets in the Gulf of Mexico, Brazil and Azerbaijan.

"When BP acquired Devon's Gulf of Mexico assets it was clear that these four fields did not fit well with the rest of our business in the region," said Andy Hopwood, BP executive vice president, Strategy and Integration.

"We therefore decided they would be of more value to another company than to BP," he added. BP hopes to complete the deal in early 2011.

And it expects the Gulf of Mexico spill to cost it more than $32.2 billion, taking into account compensation as well as clean up costs.

The oil spill, the worst environmental disaster in the United States, dealt a major blow to BP and forced out former boss Tony Hayward, who was heavily criticized by the media for clumsy handling of the spill response.

The oil disaster was triggered by a blast on the Deepwater Horizon rig -- leased by BP and operated by Transocean Energy -- that killed 11 workers on April 20.

The broken well was eventually plugged but not before it gushed about 4.9 million barrels of oil into the Gulf waters.

Copyright Agence France-Presse, 2010

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