BANGALORE/HONG KONG Aug 30 U.S. oil and gas
producer Apache Corp is selling a 33 percent stake in
its Egypt oil and gas business for $3.1 billion to state-owned
Chinese oil giant Sinopec Group, reducing its exposure in the
country amid the recent political unrest.
Apache, which has been selling noncore assets globally to
focus on U.S. onshore production and shore up its balance sheet,
said it has also formed a global strategic partnership with
Sinopec to jointly pursue upstream oil and gas projects.
The Egypt deal would be the first step of the joint venture
with Sinopec Group, parent of Sinopec Corp
, Apache said in a statement.
Apache had said it was assessing the value of its Egyptian
interests, which account for roughly a fifth of its global oil
and gas production and 27 percent of its revenue last year.
Disappointing production and investor concern over Apache's
high exposure to Egypt have pressured the company's stock. Egypt
is enduring the worst internal strife in its modern history,
triggered by the army's July 3 overthrow of President Mohamed
Apache said in the statement that its Egyptian exploration
and production operations "remain unaffected" by the political
turmoil in the country as they are located in remote,
Net production from Apache's Egypt operations averaged
100,000 barrels of oil and 354 million cubic feet of natural gas
per day in 2012, Apache said, adding that it employs about 9,000
people in the north African country.
Apache will continue to operate its oil and gas projects in
Sinopec and other state-owned Chinese oil firms have been
investing billions of dollars in energy projects around the
world as part of Beijing's drive to expand its footprint in the
global oil industry and beef up energy security amid surging
The sale of the Egyptian assets to Sinopec International
Petroleum Exploration and Production Corp - a wholly-owned unit
of Sinopec Group - is subject to regulatory approvals and is
expected to close during the fourth quarter, said Apache.
Last month Apache also sold its Gulf of Mexico shelf assets
for $3.75 billion to private equity firm Riverstone Holdings LLC
in order to focus on growth from its U.S. onshore assets.