Newfield Exploration Co. signed a sales agreement with some of its joint venture partners to divest its non-operated 12% stake in the Bohai Bay field in China for approximately US$39 million.
The deal is subject to customary regulatory approval, and customary post-close adjustments.
“We expect that the sale will significantly alter the relationship between capitalized costs and proved reserves for our China full cost pool, and as such, a gain or loss may be recognized upon closing. We expect this transaction to close in mid-2017,” Newfield said in a securities filing.
Production from Newfield’s interest in Bohai Bay was 578 MMbbl for the year ending 31 December. The company’s net proved reserves for its interest in the Bohai Bay field were 3.1 MMbbl.
Newfield’s China revenues came in at $217 million for 2016, a 17% decrease when compared to 2015. About 90% of its production from the year was from the CNOOC’s Pearl development, which reached peak production during 2015 and was on plateau for most of 2016.
The company said it expects declining production from the Pearl development during 2017.
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