Subscribe
PLANT

BP announces $2.27 billion selling spree

Oil giant sells California refinery and Texas gas processing plants to pay for well blowout in Gulf of Mexico.


August 13, 2012
by The Canadian Press

LONDON, UK: BP has gone on a selling spree.

The oil giant has sold its refinery in Carson, California and other West Coast assets to Tesoro Corp.

Tesoro is paying $2.5 billion cash for the refinery, pipelines, storage terminals, marine terminals and about 800 Arco-branded retail outlets in southern California, Arizona and Nevada, the British company said. BP is also selling the Arco brand rights for northern California, Oregon and Washington and will lease them back from Tesoro.

The Carson refinery, with a capacity of 266 million barrels per day, is adjacent to Tesoro’s Wilmington refinery. Combining the two is expected to cost $225 million but yield annual savings of about $250 million, Tesoro said.

Tesoro also will acquire BP’s 51% stake in a 400-mega watt gas cogeneration facility which supplies electricity to the Carson refinery and the local area.

The company has also sold two gas processing plants in Texas to Eagle Rock Energy Partners for $227.5 million in cash for the Sunray and Hemphill gas processing plants in Texas.

The plants have a combined capacity of 220 million cubic feet of gas per day and a gathering system of about 4,000 km of pipelines.

Houston-based Eagle Rock Partners says the deal includes a 20-year agreement to process BP’s natural gas production from the existing wells connected to the two facilities.

BP has now sold or agreed to sell assets worth $26.5 billion since 2010. The company has a target of $38 billion in disposals by the end of next year to help pay the costs of the Macondo well blowout in the Gulf of Mexico.

Tesoro, based in San Antonio, Texas, said the $2.5 billion purchase price includes about $1.3 billion for the oil and refined products on the site.

©The Canadian Press