As part of its 2012-2013 asset distribution program, ConocoPhillips (NYSE:COP) announced today it has agreed to sell its Algerian business unit to Indonesian state-owned oil and gas company Pertamina for $1.75 billion plus "customary adjustments."
The deal is expected to close in mid-2013, and is subject to Algerian regulatory approval, and co-venturer pre-emptive rights.
According to Don Wallette, ConocoPhillips executive vice president of Commercial Business Development and Corporate Planning, "The sale of our Algerian business unit represents another important step in transforming ConocoPhillips' asset base, and advances the strategic interests of both Pertamina and ConocoPhillips."
The sale includes ownership interests in ConocoPhillips' three onshore oil fields located entirely, or partially, in its Algerian Block 405a field. ConocoPhillips' 2012 net production from these fields averaged 11 thousand barrels of oil equivalent per day through October, the company said, and as of Oct. 31, the net carrying value of ConocoPhillips' Algerian assets was approximately $850 million.
In addition to the sale to Pertamina, ConocoPhillips expects sales proceeds of an additional $5.25 billion, for a total of $7 billion, based on prior asset sale agreements. All sale proceeds are to be used for general corporate purposes.