Bloomberg News

BP Sees ‘Growth Potential’ in Argentina After Cnooc Deal Fails

December 06, 2011

Dec. 6 (Bloomberg) -- BP Plc Chief Executive Officer Bob Dudley said Argentine crude producer Pan American Energy LLC has “growth potential” after the deal to dispose of BP’s stake collapsed last month.

“It’s a good venture,” Dudley said in an interview in Doha, Qatar today. “It’s got growth potential. We would have closed the deal and sold it, but we were not the ones who pulled it down.”

BP agreed in 2010 to sell its 60 percent interest in Pan American to Bridas Corp., equally owned by Cnooc Ltd. and the billionaire Bulgheroni family, for $7.1 billion. Bridas said it pulled out of talks because of “legal issues” and “the manner in which BP behaved during the transaction and its signing.”

Dudley said BP is sending its management team back to Pan American and that the company is no longer eager to sell the stake. The disposal was part of an asset-sale program after the Gulf of Mexico spill last year. The London-based expolorer has sold about $20 billion of assets so far and aims to dispose of about $40 billion of fields, refineries and pipelines.

“We originally set the sale back in 2010, when we needed to sell,” Dudley said today. “It’s not something that fits that criteria today.”

BP is preparing to go to trial in the U.S. in February over the accident at the Macondo well that caused the worst oil spill in U.S. history, Dudley said. The company has set aside $40 billion to pay for the disaster.

Dudley said finding new oil may be the energy industry’s greatest challenge over the next few decades in his speech at the World Petroleum Congress. Failing to follow the “exploration imperative” would lead to shortages, poverty and conflict, he said.

Dudley reiterated the company’s plans in the interview.

“We had an interest in six exploration wells in 2011 and will double this to 12 in 2012,” Dudley said. “We will get back to exploring and I would expect in 2013 that number will increase even further. That’s a lot.”

--Editor: Will Kennedy

To contact the reporters on this story: Eduard Gismatullin in London at egismatullin@bloomberg.net; Brian Swint in London at bswint@bloomberg.net

To contact the editor responsible for this story: Will Kennedy at wkennedy3@bloomberg.net


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