BP considers selling Oklahoma assets
BP Lower 48 is considering selling its assets in Oklahoma’s Anadarko and Arkoma basins, according to an internal memo from CEO David Lawler.
The Durango (Colorado) Herald newspaper received a copy of the memo and published an article this week stating executives at BP Lower 48 are considering selling properties in Oklahoma, Colorado and New Mexico to help pay for the company’s $10.5 billion purchase of BHP Billiton Petroleum (North America) Inc.’s assets in Texas’ Permian and Eagle Ford fields.
“This has been one of the most difficult decisions of my career, and I announce it with mixed emotions,” Lawler wrote in his letter to employees, according to The Durango Herald.
BP this week confirmed to
The Oklahoman that it plans to sell assets, but did not disclose which properties are being considered.
“Following the closing of BP’s recently announced acquisition of BHP’s U.S. unconventional oil and gas portfolio, BP Lower 48 may sell a portion of its legacy operating assets in U.S. onshore,” the company said in the statement. “This is part of a previously announced plan to divest $5 billion to $6 billion of predominantly upstream assets, with proceeds from the divestments
intended to fund a share buyback program of up to $5 billion to $6 billion over time.
“It’s also consistent with BP’s approach of actively managing and high-grading its advantaged oil and gas portfolio, focusing on higher return assets with significant development potential. The divestments are still being evaluated and are contingent on a number of factors.”
BP is at the beginning of a sales process that could take up to two years to complete, and if a suitable buyer isn’t found, the company may keep some of the forsale properties, according to a person familiar with the situation. Normal business operations are expected to continue while the process is underway.
BP Lower 48 operates about 1,000 wells in eastern Oklahoma’s Arkoma Basin and central Oklahoma’s Woodford Basin.
The company also has about 200 wells in the Anadarko Basin in the western part of the state.
Houston-based BP Lower 48 is a subsidiary of London-based BP PLC. The company in May 2016 opened its Oklahoma City regional office in the renovated Pontiac Building along Automobile Alley.
Lawler has a long history in Oklahoma. Before joining BP Lower 48, he was chief operating officer at Oklahoma Citybased SandRidge Energy Inc.
He also previously served as CEO of PostRock Energy Corp. and is the brother of Chesapeake Energy Corp. CEO Doug Lawler.