BP sells stakes in US midstream arm to Sixth Street for $1.5 billion

BP PLC on Monday announced the USD1.5 billion sale of non-controlling interests in the Permian and Eagle Ford midstream assets of bpx Energy to private investor Sixth Street.

Bpx, BP's US onshore oil and gas business, will remain operator of all the assets.

The London-based oil and gas company said the deal delivers a "material contribution" towards its target of USD20 billion of disposals by the end of 2027.

On completion, bpx's interest in the Permian midstream assets will move to 51% from 100%, while bpx’s stake in Eagle Ford will fall to 25% from 75%.

San Francisco, California-based investment firm Sixth Street will hold the remaining, non-operating interests.

BP will receive around USD1 billion on signing, with the balance expected by the end of the year, subject to regulatory approvals.

The FTSE 100 listing said the agreement enables it to unlock capital from infrastructure, while retaining operatorship and control of strategic midstream assets.

The assets sold encompass bpx's pipelines and facilities in the Eagle Ford and Permian basins, including four Permian central processing facilities – Grand Slam, Bingo, Checkmate and Crossroads.

Kyle Koontz, chief executive of bpx Energy, said: "This transaction reinforces that we are on track to maximize the return on our investment in these basins and allows us to continue operating them safely and efficiently."

BP said the transaction represents a change in ownership through non-controlling interest stakes and is expected to increase non-controlling interest on its balance sheet.

The effect on non-controlling interest reported in the income statement is projected to be in the range of USD100 to USD200 million per annum.