BP (LON:BP) has inked a deal to offload some assets in the North Sea, the blue-chip oil major has said. The company expects to land about £300 million in overall payments from the agreement.
BP’s share price has climbed into positive territory in today’s session, having added 0.74 percent to 495.65p as of 09:39 GMT, outperforming the broader UK market, with the benchmark FTSE 100 index having slipped marginally into the red and currently standing 0.03 percent lower at 7,387.33 points. The group’s shares have added more than eight percent to their value over the past year, but are down by nearly three percent in the year-to-date.
North Sea assets sale
BP announced in a statement today that it had agreed to sell a package of its interests in the Bruce assets in the North Sea to Serica Energy. The UK group currently operates the assets, which comprise the Bruce, Keith and Rhum fields, three bridge-linked platforms and associated subsea infrastructure.
Under the terms of the deal, Serica will pay the UK group an upfront payment of £12.8 million, a share of cash flows over the next four years, a consideration equivalent to 30 percent of BP’s post-tax decommissioning costs and several payments contingent on future asset performance and product prices. The FTSE 100 group expects to receive around £300 million in total, with the majority to come over the next four years.
“This is an example of BP’s Upstream strategy in action – refreshing our portfolio and focusing our activity on assets which will add most value over the long-term,” Bernard Looney, BP chief executive, Upstream, commented in the statement.
Analysts on BP
Barclays reiterated its ‘overweight’ rating on BP last week, valuing the shares at 675p, while Credit Suisse continues to see the oil major as an ‘outperform’ with a price target of 575p on the stock. According to MarketBeat, BP currently has a consensus ‘hold’ rating and an average price target of 536.94p.
The FTSE 100 oil major updated investors on its third-quarter performance last month, posting a rise in profits and unveiling plans to return cash to investors.