Now that BP (NYSE:BP) has finally entered into a stage where crisis management isn't the word used to describe their purpose, CEO Bob Dudley is seen to be working on bringing balance back to the company, as he retains the defensive posture related to the Gulf, while looking for some offense in relationship to growth.
Some of the final steps that need to be taken are to sell enough assets to pay for the estimated $40 billion the company will pay out through the years.
They've committed to raising about $30 billion through asset sales, and so far have sold off close to $14 billion.
Two assets they haven't made a decision on yet include Prudhoe Bay in Alaska, and its Pan American Energy LLC asset in Argentina. Pan American would bring them as much as $9 billion if they choose to go that route.
Part of BP's problem on the defensive side is awaiting the decision on whether or not they'll be designated as being grossly negligent concerning the oil spill in relationship to the Clean Water Act.
How that is determined could result in a liability differential of up to $10 billion.
It seems they're operating under the assumption they won't be paying the high end of the fine, but still need to raise an additional $16 billion or so to prepare for the financial challenges still remaining.
The problem for BP as a company is it keeps them in a defensive posture until they take care of it, so may take care of it sooner rather than later.
They have time as far as the payouts are concerned, but it's more the psychological factor for workers and the leaders of the company, who need to proceed in a way that shows they're going forward, while being sure they don't end up with any new fiasco.
Neglect of either one will hurt BP, and Dudley, from his comments and decisions, shows he understands that and is working hard to bring that about.
Showing posts with label Prudhoe Bay. Show all posts
Showing posts with label Prudhoe Bay. Show all posts
Wednesday, November 3, 2010
Tuesday, July 27, 2010
BP (NYSE:BP) Doubling Assets to be Sold to Raise Cash
It seems everything is on the table now as BP (NYSE:BP) fights to raise enough cash to help pay for the mounting liabilities related to the Gulf of Mexico oil spill.
Originally they had announced the goal of selling about $10 billion in assets to handle the load, but they raised that projection Monday to about $20 billion.
Once thought untouchable, and among their choice assets - oil fields in the North Sea - could reportedly be put up for sale, with the French company Total eager to enlarge their presence in the region. It would also be an easy deal to do if BP decides to go in that direction.
Prudhoe Bay was almost sold to Apache (NYSE:APA), but that deal fell through, although Apache acquired other assets in a separate transaction.
With BP securing billions in credit from a number of different banks, it seems to imply they're wary of using that credit line to pay off liabilities, as it could put them in an even weaker position, and would be expensive to access.
However they do it, this does show BP is struggling to raise the needed capital to handle the situation, and will evidently become a much smaller and weaker company before it's all through.
This is important, as everyone knew they would be smaller before things were over, but assumed their top assets would remain under the company umbrella and be a foundation to build on in the future. That idea could very well fall apart if assets in the North Sea end up being sold.
Originally they had announced the goal of selling about $10 billion in assets to handle the load, but they raised that projection Monday to about $20 billion.
Once thought untouchable, and among their choice assets - oil fields in the North Sea - could reportedly be put up for sale, with the French company Total eager to enlarge their presence in the region. It would also be an easy deal to do if BP decides to go in that direction.
Prudhoe Bay was almost sold to Apache (NYSE:APA), but that deal fell through, although Apache acquired other assets in a separate transaction.
With BP securing billions in credit from a number of different banks, it seems to imply they're wary of using that credit line to pay off liabilities, as it could put them in an even weaker position, and would be expensive to access.
However they do it, this does show BP is struggling to raise the needed capital to handle the situation, and will evidently become a much smaller and weaker company before it's all through.
This is important, as everyone knew they would be smaller before things were over, but assumed their top assets would remain under the company umbrella and be a foundation to build on in the future. That idea could very well fall apart if assets in the North Sea end up being sold.
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