BP Amoco and Shell Sell Altura Energy to Occidental Petroleum in $3.6 Billion Deal

Strategic Insights -

BP Amoco and Shell Exploration & Production Co. have agreed to sell their interests in Altura Energy Ltd. to Occidental Petroleum Corp. in a deal valued at approximately $3.6 billion. The Houston-based Altura Energy averaged daily production of about 150,000 barrels of oil equivalent during 1999 from 6,400 producing wells, and has proved reserves of approximately 850 million barrels of oil equivalent. As a joint venture formed in 1997, Altura Energy has become the largest oil producer in Texas and the leading producer of oil in the Permian Basin, which stretches from West Texas to southeast New Mexico.

Key Takeaways:

  • BP Amoco holds 64% of Altura Energy, while Shell owns 36% of the company.
  • Altura Energy averaged daily production of 150,000 barrels of oil equivalent from 6,400 producing wells in 1999.
  • The company has proved reserves of approximately 850 million barrels of oil equivalent.
  • The sale of Altura Energy will increase Occidental Petroleum's average daily oil production by 36% and add $0.50 per share to the company's 2000 earnings after accounting for costs associated with the deal.
  • The transaction is expected to close in April and is part of Shell's ongoing program of portfolio restructuring and upgrades.
  • BP Amoco and Shell formed Altura Energy as a joint venture in 1997 with the goal of merging assets covering an entire geologic basin.
  • The company has become a leading producer of oil in the Permian Basin, the largest oil basin in the lower 48 states.

Statistics:

  • $3.6 billion: The value of the deal to sell Altura Energy to Occidental Petroleum.
  • 150,000: Average daily barrels of oil equivalent production from producing wells in 1999.
  • 6,400: Number of producing wells in Altura Energy's operations in 1999.
  • 850 million: Barrels of oil equivalent proved reserves held by Altura Energy.
  • 36%: Increase in Occidental Petroleum's average daily oil production due to the sale of Altura Energy.
  • $0.50: Additional earnings per share for Occidental Petroleum in 2000 due to the acquisition.
  • April: Expected closing date for the transaction.

Sources:

  • "BP Amoco, Shell to Sell Altura Energy to Occidental for $3.6 billion." (Name of publication not specified) - 2000.