BP clinging to $7bn Pan American sale

 
Kasmira Jefford
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OIL MAJOR BP is clinging on to the prospect of selling its majority stake in Pan American Energy, an Argentine oil producer, despite reports that the deal is on the brink of collapse.

BP’s plan to sell its 60 per cent stake to Bridas Corp, a company owned by Chinese oil producer Cnooc and Argentina’s billionaire Bulgheroni family, has hit opposition from politicians and may not be completed when the accord expires next month, it emerged last week.

The $7bn (£4.5bn) deal, announced in November last year, is part of the company’s strategy sell various assets to cover the costs of the Gulf of Mexico oil spill.

Its collapse could jeopardise chief executive Bob Dudley’s future at the oil firm. Dudley has been under mounting pressure to revive the oil giant’s share price, currently below the level they traded at when the company capped the Macondo well a year ago.

BP’s sale of its stake in Pan American has been hampered by the political situation in Argentina. It is thought that the deal could be delayed until after the presidential elections next month, according to reports this weekend.

“Deals of this scale take time to finalise with competition authorities – we are working with the other shareholders in PAE to secure competition approvals and complete the deal,” BP said.

“We can confirm the deal has not yet closed as Argentine competition approvals remain outstanding, but we remain optimistic that these approvals will be granted in due course.”