The Apache Corporation agreed on Thursday to sell a third of its Egyptian oil and gas business to Sinopec, the big Chinese petroleum company, for $3.1 billion in cash as part of a continued effort to sell off assets and rebalance its portfolio.
Last month, the American oil company announced a deal to sell its businesses in the Gulf of Mexico’s shelf to a portfolio company of Riverstone Holdings for $3.75 billion.
The sales followed a steady string of acquisitions by Apache over the last three years that cost more than $15 billion. The company has been looking to refocus on North American on-shore holdings, which it believes are more predictable and consistent in growth.
While Apache considers its Egyptian unit a strong performer, it has faced questions about the longer-term prospects of the business, given the recent instability in the country.
Apache and Sinopec reached the deal on Thursday after several months of talks. Apache, which has operated in Egypt for 20 years, will still run the business, which produced a daily average of 100 million barrels of oil and 354 million cubic feet of natural gas last year.
Sinopec, formally known as the China Petroleum and Chemical Company, has been one of the more aggressive Chinese oil companies in seeking new holdings abroad to help sate its country’s hunger for fuel.
“We are pleased to launch a global partnership with Sinopec, and to welcome them into our business in Egypt,†G. Steven Farris, Apache’s chairman and chief executive, said in a statement. He added, “Sinopec is an ideal partner for us, and we look forward to the growth and value generation ahead for both companies through the expansion of our collaboration to other projects.â€
The deal is expected to close by the year’s end, with the new partnership beginning on Jan. 1.
