BP veteran Browne builds US Gulf oil acreage
LONDON, July 19
LONDON, July 19 (Reuters) - Former BP chief executive John Browne is to preside over the biggest set of oil and gas assets in the shallower, mature section of the Gulf of Mexico after buying them from U.S.-based Apache Corp.
Private equity firm Riverstone Holdings LLC, where Browne is a partner, is to pay Apache $3.75 billion for its continental shelf assets, Houston-based Apache announced on Thursday.
The area covering 1.9 million net acres and 500 blocks will be held through a Riverstone portfolio company, Fieldwood Energy LLC, Riverstone said in its own statement.
Browne ran BP from 1995 to 2007 through an era when it built a position as one of the most important players in the Gulf, especially in the deeper water, where it still is a big player. He was replaced by Tony Hayward - who became the public face of the company's 2010 oil spill. Hayward has also since left the British company, which is now embroiled in costly litigation over the spill.
The assets sold by Apache ended 2012 with estimated proved reserves of 133 million barrels of oil and natural gas liquids and 636 billion cubic feet of natural gas. The fields produced around 50,000 barrels of oil and liquids and 254 million cubic feet of natural gas per day. Apache is keeping a 50 percent stake in the unexplored portions of the properties.
Apache is looking to focus on growth from its U.S. onshore assets. Having spent more than $16 billion acquiring oil and gas properties over the last three years, it is now selling off assets as it has struggled to grow production and its shares have suffered.
Fieldwood will also assume $1.5 billion in estimated future costs related to plugging and abandoning old oil and gas wells, Apache said.
Riverstone is an energy and power-focused private investment firm founded in 2000 with approximately $25 billion of equity capital raised across seven investment funds.