By Sarah Young and Dmitry Zhdannikov
LONDON, March 4 British oil company BP
plans to separate its onshore U.S. oil and gas assets into a new
wholly-owned business to improve the competitiveness of its
shale gas portfolio there.
A number of big oil companies, including rival European
operators Shell and BG, have struggled after
making big investments in U.S. shale which have left them
exposed to depressed gas prices, dragging on their profits.
BP said a separate U.S. shale business, headquartered at a
new location in Houston, would be more competitive because it
would have faster decision-making abilities and shorter cycle
times from gaining access to drill through to production.
"The new business will remain a critical part of BP's
portfolio over the long-term," BP Chief Executive Bob Dudley
told a presentation in London, adding the creation of a
"discrete, high quality" unit would give options for the future.
BP, Europe's second-biggest oil company by stock market
value, said in October it would sell $10 billion worth of assets
by the end of 2015, building on the $40 billion of assets it
sold to help pay for the 2010 Gulf of Mexico oil spill.
The separate U.S. business, which excludes BP's substantial
portfolio off the U.S. coast, would consist of unconventional
resources of around 7.6 billion barrels of oil equivalent
including BP's stakes in the prolific Eagle Ford shale in Texas,
BP said, adding it would start to disclose separate results for
the new business from 2015.
BP's larger rival Shell said in January it could look to
dispose of parts of its U.S. shale business as part of a drive
to improve its capital efficiency.
Shares in BP traded down 0.4 percent at 1356, paring earlier
gains of around about 0.5 percent, lagging Britain's blue chip
FTSE 100 index which was up 1.4 percent.
The company suffered a setback on Monday when a U.S. court
decision against it hurt its efforts to limit payments over the