ConocoPhillips to Shed U.K. Oil Exploration Business --Update
April 18 2019 - 10:19AM
Dow Jones News
By Micah Maidenberg
ConocoPhillips is exiting the oil exploration and production
market in the U.K., the latest move by the company to refocus its
portfolio.
The company said Thursday it reached a deal to sell two
subsidiaries that focus on production in the U.K.'s North Sea for
about $2.68 billion in cash to Chrysaor E&P Ltd.
ConocoPhillips has been divesting some of resources and focusing
in part on projects in Alaska and Louisiana, as well as in Canada
and Asia. In prepared remarks, ConocoPhillips Chief Executive Ryan
Lance said investments would be focused "across future low cost of
supply opportunities." The company generated about $1.1 billion
from selling parts of its portfolio last year.
The U.S. oil giant sold a subsidiary to BP in 2018 that holds an
interest in a BP-operated oil field offshore from Scotland, though
it retained a 7.5% stake in that resource. Last year the company
also disposed of assets in the Barnett shale area in Texas.
Wednesday, it completed its sale of an interest in an oil
resource located in the Timor Sea to the government of
Timor-Leste.
"I think we've also had a pretty successful track record of
divesting assets that don't compete in the portfolio," Mr. Lance
told investors in January.
ConocoPhillips said Thursday it will continue operating a
London-based trading business and keep its 40.25% interest in the
Teesside oil terminal.
The ConocoPhillips UK subsidiaries last year produced 72,000
barrels of oil equivalent per day and had proven reserves of 99
million barrels of oil equivalent at year end, the company
said.
Closely held Chrysaor was formed in 2007 and focuses on oil and
gas in the North Sea. In 2017, it bought assets in the North Sea
from Royal Dutch Shell PLC for $3.8 billion.
"This significant acquisition reflects our continuing belief
that the U.K. North Sea has material future potential for oil and
gas production, " Chrysaor Chief Executive Phil Kirk said in
prepared remarks.
The sale is expected to be completed in the second half of this
year.
ConocoPhillips plans to release its first-quarter financial
report on April 30.
Shares in ConocoPhillips rose 0.6% in morning trading to
$66.16
Write to Micah Maidenberg at micah.maidenberg@wsj.com
(END) Dow Jones Newswires
April 18, 2019 10:04 ET (14:04 GMT)
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