BP and Bridas to form new integrated energy firm in Argentina
BP has agreed to combine its interests in the oil and gas producer Pan American Energy (PAE) with Bridas’ refining and marketing firm Axion Energy to form a new integrated energy company in Argentina.
The new entity Pan American Energy Group (PAEG) will be owned equally by BP and Bridas in a transaction that does not involve any financial payments.
The move is expected to create a unified ownership structure that helps in aligning the PAEG shareholders’ interests across the upstream and downstream business units in Argentina, Uruguay and Paraguay.
BP Group chief executive Bob Dudley said: “Supported by the combined skills and expertise of BP and Bridas, this new integrated business will be able to pursue growth and development opportunities in Argentina, Uruguay, Paraguay and Mexico.
“We see value-enhancing opportunities throughout PAEG’s businesses; from extending the life of mature production and developing new unconventional resources, including Vaca Muerta, to growth in retail fuels and lubricants marketing.”
PAEG is expected to leverage BP’s global upstream technical and downstream marketing experience, as well as Bridas’ deep operating expertise.
In addition, the merger could present the companies with additional integration synergies, building on the existing relationship between the Axion refinery and PAE’s Argentine crude oil production.
PAE, which is currently owned by BP and Bridas on 60:40 basis, had a daily production of around 262,000 barrels of oil equivalent last year.
Axion owns and operates the Campana refinery, located north of Buenos Aires, with a capacity of 90,000 barrels of oil per day.