Hilcorp Alaska will purchase BP’s entire Alaskan business for US$5.6 billion.
The transaction will include BP’s entire upstream and midstream business in the state, including BP Exploration (Alaska) Inc, owner of all of BP’s upstream Alaskan oil and gas interests, as well as BP Pipelines (Alaska) Inc’s interest in the Prudhoe Bay field and the Trans Alaska Pipeline System.
Under the agreement, Hilcorp will pay BP a total consideration of US$5.6 billion, comprising US$4 billion payable near-term and the remaining through an earnout thereafter.
BP Group Chief Executive Bob Dudley said Alaska has been instrumental in BP’s growth and success for more than half a century.
However, BP is steadily reshaping, which means other US and worldwide opportunities more closely aligned with the company’s long-term strategy are more competitive investment options.
“This transaction also underpins our two-year US$10 billion divestment program, further strengthening our balance sheet and enabling us to pursue new advantaged opportunities for BP’s portfolio within our disciplined financial framework,” said Mr Dudley.
Mr Dudley said BP’s exit from Alaska does not diminish BP’s commitment to America, as BP have invested more than US$20 billion in the US over the previous three years and will continue to investigate further investment opportunities.
BP Alaska Regional President Janet Weiss said that BP are confident the transaction is in the best interests of both the company and the state, and that the business will be best positioned for the future with Hilcorp.
The transaction is expected to be completed in 2020, subject to state and federal regulatory approval.
For more information visit the BP website.
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