Pakistan claims rights in BP sale

Click to follow

BP has started an auction of its $600m assets in Pakistan which could put the recovering energy giant on a collision course with the country's government.

Citi has been hired to run the sale, which is part of the company's attempts to raise cash to pay for the Gulf of Mexico oil spill, and expects bids by the end of the month.

However, the state-owned Oil and Gas Development Corporation (OGDC) believes it has pre-emption rights, giving it first chance to buy the assets, a mixture of off and onshore fields. BP is understood to believe no such deal exists, but some potential bidders fear that OGDC will delay the process.

Mediterranean Oil & Gas, an AIM-listed energy minnow, is also up for sale. Adviser CIBC has sent potential buyers a flier, asking for bid proposals to be submitted by mid-November with preference given to those bidding for the entire company.