HOUSTON, Oct. 8 (Xinhua) -- British oil giant BP announced Monday it has reached a deal to sell its Texas City refinery to Marathon Petroleum Corporation for 2.5 billion U.S. dollars.
With Monday's deal, the total value of the divestments that BP has agreed to since the beginning of 2010 is over 35 billion U.S. dollars.
London-based BP expects the total divestments to reach 38 billion U.S. dollars by the end of 2013. "Today's announcement is the second major milestone in the strategic refocusing of our U.S. fuels business," Iain Conn, chief executive of BP's global refining and marketing business, said in a statement.
"Together with the sale of our Carson, California refinery, announced in August, the divestment of Texas City will allow us to focus BP's U.S. fuels investments on our three northern refineries, "he said.
The 2.5 billion U.S. dollars included 600 million dollars in cash, 1.2 billion for inventories and 700 million that Ohio-based Marathon will pay BP over the next six years in a so-called "earn- out" arrangement that depends on the plant's future operational performance and refining margins.
Under the deal, Marathon, apart from the 475,000 barrels per day Texas refinery, will also acquire associated natural gas liquids pipelines, and four marketing terminals in the Southeast U. S.. BP will also assign Marathon contracts to supply around 1,200 retail sites in four southern U.S. states.
BP anticipates the transaction will close by early 2013.
BP acquired the Texas City refinery when it merged with Amoco in 1998. The refinery is also the site of an explosion in March 2005 that killed 15 people and injured scores of others.
BP, which has been selling off assets to help pay for cost related to the 2010 oil spill in the Gulf of Mexico, first put the Texas City refinery up for sale in February of 2011.
The 2010 blowout of BP's Macondo well in the Gulf of Mexico triggered an explosion that killed 11 rig workers and unleashed the worst oil spill in U.S. history.