BP mulls sale of its stake in Constellation's oilfield

BP owns 66.7% of the Constellation field, which produces about 10,000 barrels a day. Reuters

BP is weighing a sale of its majority stake in the Constellation oilfield in the Gulf of Mexico, according to people familiar with the matter, as it pushes ahead with a divestment programme.

The oil exploration and production giant has reached out to potential buyers of the deepwater asset, which could achieve a value of around $200 million in any sale, the people said, asking not to be identified because they aren’t authorised to speak publicly.

The field is expected to attract interest from closely held peers and larger corporations, according to the people. A representative for BP declined to comment.

A sale would form a small part of BP chief executive Bernard Looney’s plan to divest $25bn in assets by 2025 to cut debt and transform the company into a clean-energy giant. BP is also in discussions about a sale of a roughly 10 per cent stake in a key gas field in Oman, Bloomberg News reported in June. Investors have so far remained skeptical of the plans, with BP’s stock down 58 per cent this year through Wednesday, giving it a market value of £40bn pounds ($52bn).

The Gulf of Mexico has emerged as a source of stability and a steady source of cash-flow during this year’s oil-price rout, in contrast to the previous six years when the offshore region was overlooked by many companies in favor of shale.

BP owns 66.7 per cent of the Constellation field, which produces about 10,000 barrels a day, according to its website. The remainder is held by operator Occidental Petroleum, which inherited it through its $37bn purchase of Anadarko Petroleum last year. Occidental has so far held onto the former Anadarko Gulf assets, even as it’s been aggressively trying to sell elsewhere to raise money and pay down debt.