Hess to sell interests in ACG fields, BTC line to ONGC for $1 billion

Hess Corp. reported it will sell its 2.72% interest in the Azeri, Chirag, and Guneshli (ACG) fields in Azerbaijan and its 2.36% interest in the associated Baku–Tbilisi–Ceyhan (BTC) pipeline to ONGC Videsh Ltd. (OVL), the overseas arm of India’s state-owned Oil & Natural Gas Corp., for $1 billion.

The transaction, expected to close in first-quarter 2013, is subject to Indian and other government and regulatory approvals.

The BP-operated ACG fields, in the Caspian Sea 100 km east of Baku, started production in 1997.

“The sale of our interest in ACG is consistent with our strategy to divest mature and small working interest assets,” said Greg Hill, president of worldwide exploration and production for Hess. “Including this transaction, we have announced asset sales year-to-date totaling nearly $2 billion and additional asset sales are under way as part of our strategic portfolio reshaping,” Hill added.

Shareholders of the ACG fields include BP 34.1%, Chevron Corp. 10.3%, SOCAR 10%, Inpex 10%, Statoil 8.6%, ExxonMobil Corp. 8%, TPAO 6.8%, Devon Energy Corp. 5.6%, and Itochu 3.9%. Russia's Lukoil pulled out of the project in 2003 selling all of its interest to Inpex.

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