BP's US$7b stake deal to CNOOC ends
Source: Bloomberg News |
November 7, 2011, Monday
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Print Edition
Print Edition
BP Plc's US$7.1 billion deal to sell a stake in Argentine crude producer Pan American Energy LLC to China's CNOOC Ltd collapsed, 10 days after Argentina's president ordered oil companies to repatriate future export revenue.
Bridas Corp, a company owned by CNOOC and Argentina's billionaire Bulgheroni family, said late Saturday it canceled the deal because of legal reasons and BP's behavior during the talks. The British company struck the agreement to sell its 60 percent stake in Pan American to Bridas a year ago as it sought to conserve capital after the oil spill at a Gulf of Mexico well left it with a bill of more than US$40 billion.
"This isn't of huge concern," said Jason Kenney, London-based head of European oil and gas equity research at Banco Santander SA. "They still have plenty to sell. They can keep Pan American and do very well out of it."
BP has "received a letter from Bridas Corp exercising their right to terminate the share purchase agreement under which it had agreed to buy BP's 60 percent interest in Pan American Energy LLC," London-based BP spokesman Mark Salt said in an e-mailed statement yesterday. "BP will now be considering all its strategic options regarding PAE."
In her first move after winning re-election, President Cristina Fernandez de Kirchner on October 26 ordered gas, oil and mining companies to repatriate all future export revenue as part of an effort to strengthen central bank controls on dollar purchases.
"Both the Chinese and Argentine governments have always been positive about this transaction," Bridas said in a statement e-mailed Saturday. "Neither the European financial crisis nor any measure that has been taken in Argentina have influenced this decision."
Bridas is willing to continue talks, the company said. BP said on October 25 that each party would have the right to terminate the accord without notice after November 1 unless both agreed to extend the deadline.
The UK-based company also said it expected the deal to be completed in 2012.
Bridas Corp, a company owned by CNOOC and Argentina's billionaire Bulgheroni family, said late Saturday it canceled the deal because of legal reasons and BP's behavior during the talks. The British company struck the agreement to sell its 60 percent stake in Pan American to Bridas a year ago as it sought to conserve capital after the oil spill at a Gulf of Mexico well left it with a bill of more than US$40 billion.
"This isn't of huge concern," said Jason Kenney, London-based head of European oil and gas equity research at Banco Santander SA. "They still have plenty to sell. They can keep Pan American and do very well out of it."
BP has "received a letter from Bridas Corp exercising their right to terminate the share purchase agreement under which it had agreed to buy BP's 60 percent interest in Pan American Energy LLC," London-based BP spokesman Mark Salt said in an e-mailed statement yesterday. "BP will now be considering all its strategic options regarding PAE."
In her first move after winning re-election, President Cristina Fernandez de Kirchner on October 26 ordered gas, oil and mining companies to repatriate all future export revenue as part of an effort to strengthen central bank controls on dollar purchases.
"Both the Chinese and Argentine governments have always been positive about this transaction," Bridas said in a statement e-mailed Saturday. "Neither the European financial crisis nor any measure that has been taken in Argentina have influenced this decision."
Bridas is willing to continue talks, the company said. BP said on October 25 that each party would have the right to terminate the accord without notice after November 1 unless both agreed to extend the deadline.
The UK-based company also said it expected the deal to be completed in 2012.
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