Global energy company British Petroleum (BP) has agreed to sell its assets in the US state of Alaska to Hilcorp Alaska for $5.6bn. Hilcorp has agreed to pay BP a ‘total consideration’ of $4bn upfront followed by the remaining $1.6bn.

As part of the deal, BP will sell BP Exploration Alaska, which owns the company’s upstream and midstream businesses in Alaska, as well as its interest in the Trans Alaska Pipeline System (TAPS). The deal is subject to state and federal regulatory approval and is expected to be completed in 2020.

The deal is part of BP’s efforts to divest $10bn in assets in 2019 and 2020. In June 2019, for example, the company sold its interests in the Gulf of Suez oil concessions in Egypt to Dragon Energy for an estimated $600m.

News of the deal saw BP’s share price rise on the London Stock Exchange from 488p to 498.75p a share, the equivalent of a 2.2% increase, which gives it a current market capitalisation value of £101.4bn. However, this price is far from the company’s 2019 peak of 582.50p on 23 April.

BP group chief executive Robert Dudley said: “Alaska has been instrumental in BP’s growth and success for well over half a century and our work there has helped shape the careers of many throughout the company.

“We are extraordinarily proud of the world-class business we have built, working alongside our partners and the State of Alaska, and the significant contributions it has made to Alaska’s economy and America’s energy security.

“We are steadily reshaping BP and today we have other opportunities, both in the US and around the world, that are more closely aligned with our long-term strategy and more competitive for our investment. This transaction also underpins our two-year $10bn divestment programme, further strengthening our balance sheet and enabling us to pursue new advantaged opportunities for BP’s portfolio within our disciplined financial framework.”

BP in Alaska

BP has been operating in Alaska since 1959, and in that time, helped to build the 800-mile Trans Alaska Pipeline in the 1970s. It has also produced 13 billion barrels of oil from Prudhoe Bay since 1977, making it the most productive in US history.

The company also has 1,600 employees based in Alaska, however, BP was only able to state that it was ‘committed to providing clarity about their future as soon as possible as part of the transition process with Hilcorp’.


Hilcorp was founded in 1989 and has since become one of the largest privately-held exploration and production companies in the US, having completed $6bn in oil and gas acquisitions.

Perhaps its most well-known scheme is the Liberty Project in Alaska, a light-oil reservoir with an estimated 150 million barrels of oil. Hilcorp has said that it will build an artificial gravel island to support oil production and allow the transfer of oil onshore through subsea pipelines.

However, the project has been delayed by regulatory approvals. The US Bureau of Ocean Energy Management (BOEM) approved it in October 2018, but the Department of Interior delayed it again in June 2019 due to Hilcorp’s proposal to ignite spilt oil rather than use mechanical clean-up techniques as standard.