BP has reached an agreement to sell its Texas City, Texas refinery and a portion of its retail and logistics network in the Southeast U.S. to Marathon Petroleum Corporation for $2.5bn (which includes $0.6bn of cash at closing, an estimated value of $1.2bn for hydrocarbon inventories and a $0.7bn six year earn-out arrangement based on future margins and refinery throughput).
Subject to regulatory and other approvals, Marathon Petroleum will purchase the 475,000 bbl/d refinery, associated natural gas liquids pipelines, and four marketing terminals in the Southeast U.S. BP will also assign certain branded jobber contracts supplying approximately 1,200 retail sites in Tennessee, Mississippi, Alabama and Florida which could be supplied by the refinery. BP will remain a significant retailer of fuels in the U.S., with approximately 8,000 BP and ARCO-branded sites in the Midwest, Pacific Northwest and along the East Coast. BP anticipates the transaction will close by early 2013.
With this agreement the total value of the divestments that BP has agreed since the beginning of 2010 is now over $35bn and BP expects it to reach $38bn by the end of 2013.