BP is actively seeking buyers for a stake in its US natural gas pipeline system, with potential deals fetching up to $3bn, reported Reuters, citing four people with knowledge of the matter.
The company is considering the sale of up to a 49% stake as part of a strategic initiative by CEO Murray Auchincloss to alleviate the its debt burden.
BP’s pipeline network spans approximately 1,500 miles and transports 1.1mbbl/d of various fuels across the US.
The move to divest a portion of its pipeline holdings comes amid bp’s broader efforts to streamline operations and bolster financial performance.
The company’s net debt escalated to $24.3bn by the end of September, an increase from $22.3bn in the previous year, partly due to lower-than-expected proceeds from asset sales.
BP’s shares have dropped more than 18% this year, underperforming its rivals. In contrast, Shell’s shares are down 3%, while ExxonMobil’s are up 14% and Chevron’s have gained nearly 7%.
As bp grapples with a share price that has underperformed relative to its peers, it is also exploring the sale of interests in other energy assets.
These include its Lightsource bp solar venture, as well as its onshore wind division in the US and offshore wind projects.
Auchincloss, who is focused on enhancing cash flow and reducing debt, is due to provide an update on the company’s strategy in February.
The US oil and gas pipeline sector has seen a trend towards consolidation as challenges in obtaining permits for new pipelines have amplified the value of existing infrastructure.
While bp has declined to comment on the potential sale, the information comes from sources who requested anonymity due to the private nature of the discussions.
“BP seeks sale of US pipeline stake to reduce debt” was originally created and published by Offshore Technology, a GlobalData owned brand.
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