UK: Purchase of Oil Stake BP Signs Contract with Conoco Phillips to Acquire 45.1 % Interest in Clair field
Through this deal, BP aims to buy Conoco Phillips’s 16.5% interest in the field. In addition to this, BP has sold its entire 39.2 % interest in the Greater Kuparuk Area, Alaska to Conoco Phillips.
UK – BP has recently announced that it has entered into agreements with Conoco Phillips that will significantly increase its holding in the Clair field, a core asset of BP’s North Sea business in the UK, while also selling its non-operating interest in the Kuparuk and satellite oilfields in Alaska.
BP has entered into an agreement to purchase from Conoco Phillips a 16.5 % interest in the BP-operated Clair field, west of Shetland in the UK, buying a Conoco Phillips subsidiary that will hold this interest in the field. As a result, BP will hold a 45.1 % interest in Clair and Conoco Phillips will retain a 7.5 % interest.
Separately BP has entered into agreements to sell to Conoco Phillips BP’s entire 39.2 % interest in the Greater Kuparuk Area on the North Slope of Alaska as well as BP’s holding in the Kuparuk Transportation Company.
Details of the transactions are not being disclosed but, excluding customary adjustments, the transactions together are expected to be cash neutral for BP and Conoco Phillips. The transactions, which will be subject to the State of Alaska, US federal and UK regulatory approvals and other approvals, are anticipated to complete in 2018.
The giant Clair field west of Shetland has a complex fractured reservoir estimated to have had more than 7 billion barrels of hydrocarbons originally in place. The field is operated by BP which currently holds a 28.6 % interest. Production from Clair’s first phase of development began in 2005 and the field produced an average of 21,000 barrels of oil equivalent a day (boed) in 2017. A major second development phase, Clair Ridge, is expected to start production later this year with production capacity of 120,000 boed. Appraisal has also identified potential for future stages of development of Clair.
The Greater Kuparuk Area is operated by Conoco Phillips Alaska. The Greater Kuparuk Area includes the Kuparuk oilfield and the satellite fields of Tarn, Tabasco, Meltwater and West Sak. In 2017, the Greater Kuparuk Area had average daily gross oil production of approximately 108,000 barrels a day. The agreement will also include BP’s interest in the Kuparuk pipeline, which transports oil from the Greater Kuparuk Area to the inlet of the Trans-Alaska Pipeline (Taps) at Pump Station 1.
The transaction will not affect BP’s position as operator and co-owner in the Prudhoe Bay oilfield in Alaska.