BP (NYSE: BP) is looking for a buyer to acquire its 50% stake in the SECCO petrochemicals plant near Shanghai. Sinopec, the state-controlled chemicals and refining conglomerate, owns other 50% stake in this plant; it has priority to purchase the asset but is still in the discussion about the terms proposed by BP without making final decision.
SECCO petrochemicals plant, located in the suburb of Shanghai, is the largest chemicals and refining plant in China with a building cost of $2.7 billion. Its main products are ethylene and propylene, raw materials for resin, plastic and rubber.
The UK company plans to sell between $3 billion and $5 billion worth of assets this year. BP can secure $1bn to $2bn for Selling its SECCO stake. If the deal is complete, it will become the first step for BP to scale back China. Since 2011, BP has made more than $50 billion of divestments to pay legal bills for the 2010 Gulf of Mexico oil spill.
Last year, BP reported $6.482 billion net loss, the worst annual loss in 20 years. Its trailing twelve month (TTM) net loss was $5.216 billion according to data provided by Morningstar. BP London listed shares was up 0.72%, 0.1% better than FTSE Tuesday’s trading, as investors observed this deal might improve BP’s cash position and underpin dividend.