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BP Confirms Shearwater Stake Divestment to Tailwind Energy

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BP plc BP recently confirmed the divestment of its Shearwater stake, per reports. It has agreed to sell its 27.5% interest in the Shearwater field to Tailwind Energy, a privately-held oil and gas company. Several reports in the last few months hinted at the potential transaction, which included Tailwind Energy as a contender for acquiring the stake. The acquirer has Mercuria Energy Group as equity partner.

The Shearwater project is operated by Royal Dutch Shell plc RDS.A and is located in the U.K. North Sea, 225 kilometers east of Aberdeen. The field produces 18,000 barrels of oil equivalent per day. Last year, the British energy giant agreed to divest Shearwater and Andrew projects to Premier Oil for $625 million, which didn’t materialize. Instead, Premier Oil merged with Chrysaor Holdings, with the combined entity being named Harbour Energy plc HBRIY.

The financial details of the deal are yet to be disclosed. The Andrew project is not included in the deal. It is not expected to be divested at the moment as the company informed its staff to continue operations at the site.

The divestment is in line with the company’s plan of streamlining its portfolio. In 2021 alone, the company is expected to gather $4-$6 billion of proceeds from divestments and disposals. By 2025, BP will likely sell $25 billion worth of assets, which can provide it with funds to support the company’s energy transition. BP is currently going through a restructuring phase. It has plans to reduce emissions and boost low-carbon spending. BP intends to boost low-carbon spending to $5 billion per annum by 2030. Within this time period, it plans to reduce emissions from operations by 30-35%.

Price Performance

BP has gained 13.3% in the past year compared with 25.2% rise of the industry it belongs to.

Zacks Rank & Stock to Consider

The company currently has a Zacks Rank #3 (Hold). A better-ranked player in the energy space is Braskem S.A. BAK, having a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Braskem’s bottom line for 2021 is expected to rise 231.3% year over year.

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BP p.l.c. (BP) : Free Stock Analysis Report

Royal Dutch Shell PLC (RDS.A) : Free Stock Analysis Report

Braskem S.A. (BAK) : Free Stock Analysis Report

Harbour Energy PLC Sponsored ADR (HBRIY) : Free Stock Analysis Report

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