BP PLC BP agrees sale of interest in SECCO to Sinopec (5668D)
27 April 2017 - 9:27PM
UK Regulatory
TIDMBP.
RNS Number : 5668D
BP PLC
27 April 2017
press release
27 April 2017
BP agrees sale of interest in SECCO to Sinopec
BP today announced that it has agreed to sell its 50% stake in
the Shanghai SECCO Petrochemical Company Limited (SECCO) to Gaoqiao
Petrochemical Co Ltd, a 100% subsidiary of China Petroleum &
Chemical Corporation (Sinopec), BP's joint venture partner, for a
total consideration of $1.68 billion.
"This decision aligns our petrochemicals business in China with
our global focus on areas where BP has leading proprietary
technologies and competitive advantage. China is a key region for
our chemicals business and BP will continue to look for
opportunities to build on our position in the country," said Rita
Griffin, Chief Operating Officer, BP Global Petrochemicals.
SECCO is currently owned by BP (50%), Sinopec (30%) and Sinopec
Shanghai Petrochemical Company Limited (20%), in which Sinopec
holds a majority interest. Based in Shanghai, SECCO is a major
producer of olefins - ethylene and propylene - together with
polymers and other derivatives including polyethylene,
polypropylene, acrylonitrile styrene, polystyrene, butadiene and
other products.
"China is a country of great significance to BP given its market
potential," said Dr. Xiaoping Yang, BP China President, "BP has
been committed to doing business in China for more than four
decades. Looking into the future, we plan to continue to invest in
China in areas that provide the best growth opportunities for BP,
our Chinese partners and the country."
The transaction is subject to a number of regulatory approvals
and other conditions, subject to which, it is currently anticipated
to complete before the end of the year with the consideration
payable in instalments.
Notes to editors
-- The BP group's consolidated pre-tax profit for the year-ended
31 December 2016 included the Group's share of the net profits of
SECCO amounting to $301m (comprised of pre-tax profit of $404m,
taken from SECCO's income statement and reconciled to IFRS, and tax
amounting to $103m).
-- As at 31 December 2016, the value of the gross assets the
subject of the transaction was $993 million.
-- BP intends to use the proceeds from the disposal, most if not
all of which are anticipated to be received in 2017 (subject to
completion), for general corporate purposes.
-- BP has had a petrochemicals business in China since the
1970s, first through technology licensing and then manufacturing
joint ventures. In addition to SECCO, BP has three other
petrochemical manufacturing joint ventures in China: purified
terephthalic acid (PTA) production in Zhuhai; and acetic acid and
other acetyls production with YARACO in Chongqing and BYACO in
Nanjing. In March 2015, BP began production from Zhuhai Unit 3, the
world's largest single train PTA unit.
-- BP is one of the leading foreign investors in the Chinese oil
and gas sector. BP's business activities in China include
exploration and development, petrochemicals manufacturing and
marketing, aviation fuel supply, oil products retailing,
lubricants, oil and gas supply and trading, LNG terminal and trunk
line and the chemicals technology licensing. Building on its
business successes in China, BP has also expanded partnerships with
the national energy companies beyond the country's borders.
-- BP is a partner of Sinopec in China as well as
internationally on a variety of projects in both the Upstream and
Downstream.
Further information
BP press office, London: +44 (0)20 7496 4076, bppress@bp.com
BP press office, China: +86 (0)10 6589 3878,
bpchinapress@bp.com
- ENDS -
This information is provided by RNS
The company news service from the London Stock Exchange
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