Several media have reported that BP will increase its target for asset sales to as high as $40 billion. This almost certainly mean disposing of its aging oil field holdings in Prudhoe Bay, Alaska, which may be worth as much as $20 billion.
BP made the initial installment earlier than scheduled, and it will make an additional $2 billion deposit in the fourth quarter. Thereafter, it will add $1.25 billion to the fund per quarter until the total reaches $20 billion.
BP, which needs to raise funds to help clean up the worst oil spill in U.S. history, said Tuesday it will sell its operations in Colombia for $1.9 billion to Ecopetrol and the Canadian company Talisman. Ecopetrol is the largest oil company in Colombia.
The decline in property values could total $3 billion over five years, Bloomberg reported, citing real estate data company CoreLogic. The BP oil spill could wipe out the premium that buyers normally pay to be near the ocean.
Investors got an early jump on BP's earnings announcement, sending the stock about 4% higher in Monday in a positive reaction to the oil giant's anticipated ouster of CEO Tony Hayward in favor of Gulf cleanup czar Bob Dudley.
The oil spill in the Gulf of Mexico is taking a bigger bite out of BP's bottom line, according to a report issued Wednesday by analysts for Sanford C. Bernstein that hikes the oil company's cost to $33 billion.