BP plc BP announced the completion of the transaction to farm in a stake of 20% of Taas-Yuryakh Neftegazodobycha LLC from Rosneft. The deal was inked in Jun 2015.
The joint venture (JV) between Rosneft and BP, which was formed after the companies had signed the aforesaid deal for Taas-Yuryakh Neftegazodobycha LLC, is intended to carry on further development of the Srednebotuobinskoye oil and gas condensate field – one of the largest fields in the Eastern Siberia. The JV will also be responsible for the development of appropriate infrastructure for further exploration and development of the region’s reserves.
Eastern Siberian fields are one of the main regions of Rosneft’s business. The companies’ collaboration within the project will therefore help in expanding local infrastructure and enhancing production capacities of this region.
Rosneft has also proposed to select a second partner in Taas-Yuryakh Neftegazodobycha, which will favorably impact the project’s development in the long term.
BP is one of the world's major energy companies. The supermajor provides its customers with fuel for transportation, energy for heat and light, retail services and petrochemical products.
Previously, the company used to report earnings through three segments: Exploration and Production, Refining and Marketing, and Other Businesses and Corporate. However, following the completion of sale and purchase agreements with Rosneft and Rosneftegaz on Mar 21, 2013, BP’s investment (19.75% interest) in Rosneft began to be reported as a separate operating segment under IFRS.
BP’s upstream margins are likely to be driven by its four main upstream profit centers – Angola, Azerbaijan, the North Sea and the Gulf of Mexico. During the third quarter, BP was awarded five new blocks in the U.K. North Sea. In Oct 2015, the company received three shallow water blocks in the offshore Egyptian part of the Mediterranean Sea. The Woodside-operated Western Flank A project offshore Western Australia, the latest phase of the North West Shelf development, was also brought online in Oct 2015. For the remainder of 2015, the company expects refining margins to improve from the 2014 level due to turnaround activity.
BP carries a Zacks Rank #3 (Hold). Some better-ranked players from the energy sector are Energy Transfer Equity, L.P. ETE, ReneSola Ltd. SOL and Boardwalk Pipeline Partners, LP BWP. Each of these stocks sports a Zacks Rank #1 (Strong Buy).
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