Thursday, August 5, 2010
British Petroleum, the fabled descendent of the Anglo-Iranian Oil Company, is in big trouble because of the financial obligations they have incurred in the Gulf oil spill. Or is it?
RIA-Novosti said that BP was considering selling part of its 50% ownership in TNK-BP, the Russian corporation that represents a fifth of BP's oil reserves, and about 25% of BP's production. Likely purchasers would be Gazprom and Rosneft. In Azerbaijan, there were reports that BP would sell its shares in the "Azeri-Chirag-Guneshli" offshore oil field. BP corporate headquarters recently floated a scheme to raise capital from TNK-BP by selling the Russians its shares in three Venezuelan projects, according to the St. Petersburg Times. The Russian newspaper claims that newly installed BP CEO Robert Dudley would preside over the sale of $30 billion in assets.
Despite the rumors of doom and gloom, however, it would appear that BP is not on a selling spree, but a buying one. On July 6, BP signed an agreement with the State Oil Company of Azerbaijan for the joint exploration and development of the Shafag and Asiman structures in the Caspian Sea. In addition, Devon Energy Company has announced that on August 16 BP will pay $2 billion dollars for Devon's 5.6% share of the "Azeri-Chirag-Guneshli" project. BP believes the field has proven oil reserves of more than 7 billion barrels, and the company will own almost 40% of the shares in the project when the sale is complete. Devon also plans to sell BP its assets in Brazil and the Gulf of Mexico. The cost of the entire deal is $7 billion dollars.
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