Occidental Petroleum Corp. (OXY) is in talks to sell a $3 billion stake in a gas field to Abu Dhabi-owned Mubadala Development Co., Petroleum Intelligence Weekly reported, without saying where it got the information.
The companies are discussing the sale of as much as 30 percent of the $10 billion Shah natural gas project in the United Arab Emirates, the newsletter reported. Two officials at Mubadala’s media department didn’t immediately respond to voice messages seeking comment. Melissa Schoeb, a spokeswoman for Occidental, declined to comment when contacted by e-mail.
Oxy, as the U.S. oil producer is known, is working with state-run Abu Dhabi National Oil Co. to develop the Shah field, with production to begin at the end of the year. The U.A.E. is tapping the reserve of sour gas, fuel with a high content of deadly sulfur dioxide, to meet domestic demand for the hydrocarbon used to run power plants and feed chemical facilities.
Oxy, based in Houston, is trying to sell some Middle East assets individually after failing earlier this year to cut 40 percent of its operations in the region, people familiar with the situation said last month.
A transaction on the Shah project could be completed by the end of this year, with Oxy retaining part of its 40 percent stake and continuing to operate the field, PIW reported. Adnoc would retain its 60 percent holding in the project in a deal that would mark Mubadala’s first domestic investment in oil or gas production, PIW said.
Oxy is also seeking to sell part of its stake in Dolphin Energy Ltd., a venture that operates a pipeline transporting gas from Qatar to the U.A.E. and Oman, PIW said. Mubadala owns 51 percent of the Dolphin gas pipeline project, with Total SA (FP) and Oxy each holding 24.5 percent.
The U.S. company may also reduce its stake in an Omani oilfield project, PIW said.-Bloomberg
Follow Arabian Post
Select Arabian Post as your preferred source on Google and MSN News for trusted business news and Arab politics and updates.
