BP 'in talks over asset sale after oil spill'

Oil giant BP is in talks over an £8bn (€9.5bn) asset sell-off to help meet the costs of tackling the Gulf of Mexico oil spill, it was reported today.

The assets up for grabs in the firm’s talks with US rival Apache Corporation include a big stake in Alaska’s giant Prudhoe Bay oil field, the Sunday Times reports.

BP has been wrestling with the growing disaster in the Gulf since the Deepwater Horizon rig exploded and collapsed on April 20, killing 11 workers.

The deal with Apache would more than fulfil its target of raising $10bn (€7.9bn) from disposals and give some assurance to markets over its ability to tackle the costs.

The sale of a stake in Prudhoe Bay – one of BP’s prize assets which produces 390,000 barrels of oil a day – would also give a huge boost to Apache.

Other sell-offs being considered are BP’s stake in Argentinian oil producer Pan American Energy as well as its operations in Venezuela, Colombia and Vietnam, the newspaper says. BP refused to comment.

Meanwhile the slump in the group’s share price since the crisis has also made it vulnerable to a takeover bid, with US giant ExxonMobil considering its options, the Sunday Times adds.

BP is working this weekend on an improved containment cap over the damaged well, which will be able to collect more than 50,000 barrels of oil a day and improve the efficiency of the operation during the hurricane season.

The installation will take up to a week to complete, although the spill is unlikely to be fully under control until relief wells are completed in mid-August.

The oil giant said last week the costs of the spill had passed the £2bn (€2.4bn) mark while it has also set up a $20bn (€15.8bn) compensation fund to meet claims after coming under intense political fire in the US.

BP insists it is strong enough to tackle the spill, with its huge cash generation of more than £20bn (€24bn) a year as well as £6.7bn (€8bn) in banking facilities. The firm is also passing its dividend for the first time since the Second World War in response to the crisis.

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