BP to sell US gas assets for $1bn

BP has agreed to sell its interests in the Jonah and Pinedale upstream operations in the Green River Basin of south-west Wyoming, US, to LINN Energy for $1bn in cash.

The sale includes BP’s operations centre in Sublette County and all of its working interests in 260 operated wells with net natural gas production of 80 million cubic feet equivalent of gas a day, and non-operated wells with 66 million cubic feet equivalent of gas a day production.

BP group chief executive Bob Dudley said, "This sale will allow us to realise the value of the mature Jonah assets and reinvest in higher growth opportunities in BP’s North America gas business and elsewhere."

"BP has invested $52 billion in the US over the past five years, more than any other oil and gas company. In fact, we invest more in the U.S. than anywhere else in the world," Dudley added.

LINN Energy chairman president and CEO Mark E. Ellis said the long-life, low-decline characteristics of the Jonah Field make this asset an "excellent fit" for the company.

"These properties are expected to provide approximately 145 million cubic feet equivalent per day of liquids-rich natural gas production," Ellis added.

The identified resource potential of Jonah Field Properties is about 1.2 trillion cubic feet equivalent with proved reserves of 730 billions of cubic feet equivalent.

The transaction, expected to close by 31 July 2012, will not affect BP’s upstream production operations in Moxa and Wamsutter, Wyoming.

The agreement to sell the Jonah assets brings the total value of divestments that BP has agreed since the start of 2010 to around $24 billion. BP expects this total to increase to $38 billion by the end of 2013.