UK-based oil and gas major BP has announced the sale of its 34.3% stake in the Yacheng gas field, located in the South China Sea, to the Kuwait Foreign Petroleum Exploration Company (KUFPEC) for a cash consideration of $308m.
The company expects to complete the transaction in the second half of 2013, subject to necessary approvals from the regulatory bodies, China National Offshore Oil Corporation (CNOOC) and third parties.
CNOOC and KUFPEC will hold 51% and 49% respectively in the Yacheng gas field, once the deal is complete.
BP China president, Chen Liming, said that the sale was part of the company’s plan to optimise its global portfolio.
"BP remains committed to working with China to contribute its deep expertise and oil and gas supply options in this important emerging market," Liming added.
The company is currently exploring the 42/05 and 43/11 deepwater blocks, which it won in 2010 and 2012 respectively.
The Yacheng field commenced operations in 1996 and BP operated it until 1 January 2004, before handing over the operatorship to its partner CNOOC.
The field currently delivers natural gas for power generation to the Castle Peak Company in Hong Kong, through a 780km pipeline.
Discovered in 1983, the Yacheng 13-1 field is said to be the largest offshore natural gas producing field in China, located about 100km south of Hainan Island, in the South China Sea and about 90 metres under water.
Image: BP to sell its 34.3% stake in the Yacheng gas field in the South China Sea for $308m. Photo courtesy of Rex.