BP relaunches sale of North Sea assets Premier Oil gave up on
Oil major BP has reportedly relaunched the sale of its North Sea assets it initially tried to sell to Premier Oil before it was taken over by another UK player, Chrysaor.
Citing industry sources, Reuters reported on Thursday that BP had relaunched the sale of stakes in a group of its North Sea assets it initially tried to sell to Premier Oil before it was acquired by Chrysaor.
To remind, Premier Oil about a year ago entered into agreements for acquisitions of the Andrew Area and Shearwater assets from BP for $625 million. The deal was expected to be completed by the end of 3Q 2020.
Among other reasons, Premier’s acquisitions of BP’s assets was supposed to enable the company to maintain rising production out to 2024.
In addition, the acquisition would help accelerate the deleveraging of the existing Premier balance sheet, materially improving its ability to deliver future refinancings of its existing credit facilities.
BP and Premier later changed the deal and lowered the price to $210 million due to Premier’s financing problems.
However, the agreement between these two companies fell through last October when Chrysaor stepped in with a plan to merge with Premier.
As a result of its merger with Chrysaor, Premier did not go ahead with its proposed refinancing or the acquisition of North Sea assets from BP. The acquisition of assets was supposed to be financed from the proceeds of the proposed financing.
Following its completion, which is expected in the first quarter of this year, the deal made between Premier and Chrysaor will create the largest London-listed independent oil and gas company. The new entity also got a new name back in December, revealing it to be Harbour Energy.
Following the reports of BP’s relaunched sale, Offshore Energy has reached out to BP seeking confirmation and more details but a BP spokesperson declined to comment.
According to Reuters, the value of BP’s assets which are up for sale is unlikely to exceed $80 million following the oil price crash last year.