Blog Coverage Australia Woodside Petroleum Acquires 3 Offshore Exploration Blocks in Senegal from ConocoPhillips

LONDON, UK / ACCESSWIRE / October 31, 2016 / Active Wall St. blog coverage looks at the headline from ConocoPhillips (NYSE: COP) as the company announced on October 28, 2016, that it has sold off its 100% share in its subsidiary, ConocoPhillips Senegal BV to Australia’s Woodside Petroleum Ltd. The deal is valued at approximately $440 million including $90 million in net adjustable. Register with us now for your free membership and blog access at: http://www.activewallst.com/register/.

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Commenting on the sale, Matt Fox, Executive Vice President, Strategy, Exploration and Technology of ConocoPhillips said:

“We are pleased to complete this transaction with Woodside. By completing this sale, we are progressing our broader exit from deep-water exploration, which will further increase our capital flexibility and reduce the cost of supply of our portfolio.”

Peter Coleman, CEO of Woodside said of the deal:

“Woodside will bring to the joint venture expertise in deep water drilling, development and operation of subsea infrastructure and floating production storage and offloading vessels. We acknowledge the work of ConocoPhillips in closing this deal.”

Details of the sale

The sale to Woodside was announced in July 2016 and was awaiting approvals from the Government of Senegal and co-venturer pre-emption rights. As per the terms of the sale, Woodside will acquire 100% assets of ConocoPhillips Senegal B.V. from parent company ConocoPhillips. The deal includes ConocoPhillips’s 35% stake in three offshore exploration blocks at Senegal. The three offshore exploration blocks are – Rufisque Offshore, Sangomar Offshore, and Sangomar Deep Offshore. As of September 30, 2016, these three blocks have a net carrying value of approximately $285 million.

ConocoPhillips expects to realize funds from the sale in the last quarter of 2016 and this will accordingly be reflected in the company’s fourth quarter earnings results. The amount can vary as it is subject to any last-minute adjustments.

As part of ConocoPhillips’ efforts to restructure its portfolio and reduce debts, it has been looking at assets sale since last year. Earlier in September 2016, ConocoPhillips had announced the sale of its stake in South Natuna Sea Block B off Indonesia to Indonesia’s PT Medco Energi Tbk. The Block B had been on offer for sale since August 2015. The deal is also expected to be finalized before end of 2016.

Earnings Highlights

ConocoPhillips had reported its earnings result for Q32016 on October 27, 2016 and recorded a net loss of $1.04 billion. For the FY16, it had also reduced its capital expenditure guidance from $5.5 billion to $5.2 billion. The company also managed to pay off debt valued at $ 1.25 billion which was maturing in October 2016. It also raised its production outlook with its full-year production guidance for 2016 now being projected at 1.565 million of barrels of oil per day (MBOED).

Stock Performance

The finalization of stakes sale and positive outlook guidance for 2017 pushed the stock up as ConocoPhillips’ share price finished yesterday’s trading session at $44.97, advancing 2.20%. A total volume of 18.4 million shares exchanged hands, which was higher than the 3 months average volume of 7.89 million shares. The stock has advanced 3.60% and 14.19% in the last month and past three month, respectively. The stock has a dividend yield of 2.22% and currently has a market cap of $55.71 billion.

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