BP to sell Pan America Energy to Bridas

BP said Sunday it has agreed to sell its share of Pan American Energy, an Argentina-based oil and gas company, to Bridas Corporation as part of its plan to divest $30 billion of assets by the end of next year.

BP, trying to recover its financial strength after the calamitous Gulf of Mexico oil spill, said it will receive just over $7 billion for its 60 percent interest in Pan American Energy, with the sale expected to be finalized next year.

“Today’s agreement further demonstrates both the high quality and attractiveness of the assets throughout BP’s global portfolio and also the company’s ability to meet our significant financial commitments arising from the Gulf of Mexico tragedy,” said BP chief executive Bob Dudley.

BP spokesman David Nicholas said Bridas Corporation, based in Argentina, is jointly owned by Bridas Energy Holdings Ltd. of Argentina and China’s offshore oil and gas company CNOOC.

BP said it already had agreements in place worth $14 billion before the new sale was announced. The money from the sale of BP’s stake in Pan American Energy will be used to increase BP’s cash reserves, the company said.

“We now have agreements in place that should secure the majority of our divestment target,” said Dudley, who became chief executive in October. “We will continue to identify further assets that may be strategically more valuable to others than to BP as we complete the program.”

BP said Bridas Corporation must make a cash deposit of $3.53 billion, beginning with a $1.41 billion deposit due on Dec. 3. The rest of the deposit must be paid on Dec. 28, the company said.

The sale is subject to governmental and regulatory approvals being obtained.

Pan American Energy produces oil and gas in the southern cone of South America. It is the second largest oil and gas producer in Argentina.

Source: AP