BP to sell $7-bn assets, says CEO will stay

Posted By: Religare
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BP has termed a report as untrue which stated that company's chief executive would be exiting from his position. BP is currently preparing itself for $7 billion asset sales in order to pay for the worst oil spill in US history.BP spokesman informed that CEO Tony Hayward, who has been widely condemned for his way of managing the disaster, but has full support from the board and will continue in office, thus falsifying a report in the Times which stated that he would quit his job within the next 10 weeks. BP shares surged which was largely stimulated by its sale of assets in the United States, Canada and Egypt to US company Apache Corp, as a part of its $10-billion asset disposal plan.JP Morgan pointed that, such a material sale in a short duration would ease if not send away any persistent concerns about BP's liquidity position. Further, it said that the stipulations of the deal appeared to be strong and emphasized on the disparity between what BP could get for its assets and it's worn out stock price.BP's market value has declined by almost 40 per cent from the time when an explosion on an oil rig killed 11 people on April 20 and further resulted in oil flowing into the Gulf of Mexico, contaminating the coastline and disturbing tourism and fishing industries in the region.BP had closed the well last week, stopping the oil flow for the first time in the three months ever since the explosion took place. Further, on Tuesday US officials have permitted to conduct another 24 hours of pressure tests on the seal.Hayward's expulsion has been the subject of rumor following a series of PR blunders and a failure to quickly stop the flow of oil into the Gulf.The Times mentioned that a person close to the issue said that Hayward may quit so that BP could cover itself against a potential buyout threat by ExxonMobil or Royal Dutch Shell.There was a growing speculation surrounding Hayward's departure in late August or September, and Robert Dudley, chief of BP's Gulf Coast restoration efforts, was seen as favorite to replace him.Al Troner, president of Asia Pacific Energy Consulting in Houston, believed Hayward was not completely responsible for the adversity occurred. BP has announced that Apache would pay $5 billion cash deposit on July 30 as a portion of the deal for exploration and production facilities in North America and Egypt. The company also informed that the deal would consist of assets in New Mexico, natural gas in western Canada and concessions in Egypt.

Story first published: Thursday, July 22, 2010, 14:59 [IST]
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