BP Plc said it completed the sale of its Prudhoe Bay oil and gas producing properties to closely-held Hilcorp Energy Co., ending 60 years as a top Alaskan oil producer.
BP and other oil majors have reduced their production roles in the northernmost U.S. state as output slid and lower-cost fields emerged elsewhere. Hilcorp, known for buying up oil castoffs, acquired half of another BP Alaska project in 2014.
The $5.6 billion deal, including BP's stake in the Trans Alaska Pipeline System which carries crude oil from Prudhoe Bay to Alaska's southern coast, should wrap up this quarter, both companies said in statements.
"We look forward to continuing to drive economic growth, create Alaskan jobs and contribute to local economies for decades to come,” said Greg Lalicker, CEO of Hilcorp Energy.
The agreement calls for Hilcorp to pay $4 billion to BP over an unspecified time, with the remaining $1.6 billion based on future earnings from the properties. Terms were revised and pushed back as Hilcorp sought to raise financing.
With the July 1 purchase, Texas-based Hilcorp becomes the state's second largest oil producer and reserves holder, behind ConocoPhillips Co. Hilcorp will nearly triple its workforce in Alaska, to 1,450 employees with the acquisition, said Luke Miller, Hilcorp spokesman.
Recommended Reading
Enerflex Appoints Thomas B. Tyree to Board
2024-03-12 - Tyree currently serves on Antero Resources’ board and recently served as chairman of Northwoods Energy LLC in 2023.
Kimmeridge Fast Forwards on SilverBow with Takeover Bid
2024-03-13 - Investment firm Kimmeridge Energy Management, which first asked for additional SilverBow Resources board seats, has followed up with a buyout offer. A deal would make a nearly 1 Bcfe/d Eagle Ford pureplay.
Hess Midstream Subsidiary Plans Private Offering of Senior Notes
2024-05-08 - The proposed issuance is not expected to have a meaningful impact on Hess Midstream’s leverage and credit profile, according to Fitch Ratings.
CEO: Coterra ‘Deeply Curious’ on M&A Amid E&P Consolidation Wave
2024-02-26 - Coterra Energy has yet to get in on the large-scale M&A wave sweeping across the Lower 48—but CEO Tom Jorden said Coterra is keeping an eye on acquisition opportunities.
E&P BW Energy Undergoes ‘Technical’ Ownership Restructuring
2024-05-08 - The restructuring will not involve any change to the ultimate control of BW Energy as the shares currently held by BW Group will be sold to BW Energy Holdings.