BP to sell Asian gas fields to help pay spill costs

By Tom Bergin

LONDON (BestGrowthStock) – BP kicked off a $10 billion asset sale aimed at raising cash to pay for its Gulf of Mexico oil spill, saying on Tuesday it planned to sell gas assets in Pakistan and Vietnam worth around $1.7 billion.

A BP spokesman said on Tuesday the company was “exploring divestment options” for its interest in the Nam Con Son gas project, which the London-based company says is one of Vietnam’s largest foreign investment projects.

The interest, which comprises stakes in the Lan Tay and Lan Do gas fields, the Nam Con Son pipeline and the Phu My power generation project, is worth $966 million, analysts at UBS said in a research note on Monday.

BP also plans to sell its upstream assets in Pakistan which comprise of a number of producing fields and exploration blocks in the southern Sindh province. The fields are worth $690 million, UBS estimated.

The Pakistan fields produced 173 million cubic feet of gas per day in 2009 net to BP, while BP’s share of the Vietnamese assets was 63 million cubic feet per day. Together they reflect around 1 percent of BP’s total oil and gas output.

The spokesman said the assets were deemed non-core for BP.

China’s CNOOC and Sinopec as well as Thailand’s PTTEP and India’s ONGC — already a partner of BP’s in Vietnam — are likely to show interest in the Nam Con Son stake, bankers and analysts who are familiar with the asset told Reuters.

Potential buyers of the Pakistan assets could include British explorer Premier Oil which already has assets in southern Pakistan. Premier was not available for comment.

As part of a deal last month with U.S. President Barack Obama in which it agreed to set up a $20 billion fund to compensate those affected by the oil spill, BP committed to sell oil and gas assets worth $10 billion in the coming year.

The company is also mulling additional asset sales that could raise another $10 billion, sources familiar with the matter have told Reuters.

The company is in talks about a potential sale of its interest in the Prudhoe Bay oil field in Alaska, sources familiar with the matter have said in the past week, although a sale is not expected imminently.

BP has already spent $4 billion on efforts to plug the Macondo well, clean up the Gulf coast and pay damages claims.

Last week, the well was capped after leaking up to 60,000 barrels per day of crude for three months.

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(Editing by Michael Shields)

BP to sell Asian gas fields to help pay spill costs