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Sinopec To Pay Apache $3.1 Billion For Oil Stake

Sinopec To Pay Apache $3.1 Billion For Oil Stake
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Παρ, 30 Αυγούστου 2013 - 17:44
China's Sinopec Group will pay $3.1 billion for a 33% stake in Apache Corp.'s Egyptian oil and gas business.
China 's Sinopec Group will pay $3.1 billion for a 33% stake in Apache Corp.'s Egyptian oil and gas business.

The move will help Houston-based Apache continue to cut its emphasis on Egypt , which accounted for 15% of its production in the second quarter of this year, down from 25% in 2010, the company said in a statement.

The Egyptian deal is the first stage in a global strategic partnership between Apache and Sinopec International Petroleum Exploration & Production Corp., a subsidiary of Sinopec Group, to pursue oil and gas projects, Apache Chairman and Chief Executive G. Steven Farris said in a statement.

Apache shares rose 3.4% to $81.30 in after-hours trading Thursday.

The company, which has a stock-market value of about $31 billion, will continue to be the operator in the Egyptian projects, which are focused in the country's western desert.

The deal helps push Apache above the $4 billion target for asset sales that the company announced earlier this year as part of a plan to shore up its balance sheet after years of acquisitions.

In July Apache said it would sell its shallow-water operations in the Gulf of Mexico to Fieldwood Energy LLC, a private-equity-backed firm, for $3.75 billion in cash.

A number of North American exploration and production companies have been selling assets and shuffling their top management in the past year in response to pressure from shareholders to focus on profitability.

Chesapeake Energy Corp. co-founder Aubrey McClendon was forced out by activist shareholders earlier this year who wanted to curb spending at the firm.

In April, Hess Corp. Chairman and CEO John Hess relinquished his chairmanship in the face of outside pressure, while Occidental Petroleum Corp. Chairman Ray Irani was forced out by shareholders seeking change. Occidental has since said it may consider selling some or all of its Middle East assets.

Apache has faced similar pressure. Only 50% of shareholders approved of Mr. Farris's compensation package this year, leading the company to slash his salary, cut pay to its board and sell assets to fund a $2 billion share-buyback program.

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