The Azerbaijan's national oil company holds rights to a oil field, Shafag-Asiman, that is speculated to to have reserves of 17 trillion cubic feet. If confirmed this massive oil field could become very lucrative in the future which is why BP PLC is in the process of making a deal with the Azerbaijan's national oil company to be able to operate and explore the field. The new collaboration consists of a 50-50 production-sharing agreement and is BP's first deal since the addition of Bob Dudley as chief executive in the U.K.
Recently BP has taken on the burden of the Deepwater Horizon oil spill and has been criticized in the U.S. Even though the company has been hurting from the freak accident in the U.S. this new deal shows BP's strong connections in the East and its ability to still attain strong deals. BP has invested in the huge Azeri-Chirag-Gunashli oilfield in the Caspian and the Baku-Tbilisi-Ceyhan pipeline which brings Azeri oil to Turkey's Mediterranean coast (Chazan, WSJ). Meanwhile the assets in Algeria owned by BP are trying to be taken over by Russian oil company TNK-BP LTD. It is not for sure yet that the Algerian oil fields operated by BP will be taken over but Fridman and associates from TNK-BP Ltd. are looking into it as well as assets in Vietnam and Venezuela to help cover costs of the Gulf of Mexico oil spill.
-Nicole Lombardo
(Wall Street Journal, Guy Chazan)
http://online.wsj.com/article/SB10001424052748703735804575535921449969264.html?mod=WSJ_Energy_leftHeadlines
This is a very interesting article as far as stock trading is concerned for British Petroleum. Recently with the events in the Gulf the price of British Petroleum stocks were cut in half over a two month period, April 23rd the price was $59.88 and June 25th the price was $27.02. Now with stock prices still suffering (As of October 6th BP stock is worth $41.61) finding a deal as amazing as this could generate a huge amount of revenue for the shareholders of British Petroleum. Even only controlling 50% of this deal British Petroleum stands to, at the very least, regain its place as a leader in the energy market.
ReplyDelete-Tom Langevin