BP to sell its 50% stake in SECCO to Sinopec for $1.68 bn

British energy giant BP Plc yesterday struck a deal to sell its 50 per cent stake in the Shanghai SECCO Petrochemical Company Ltd (SECCO) to Gaoqiao Petrochemical Co Ltd, a subsidiary of China Petroleum & Chemical Corporation (Sinopec), BP's joint venture partner, for $1.68 billion.

The sale is part of the London-based company's plan to raise up to $5.5 billion through asset sales this year in order pay for the 2010 Deepwater Horizon disaster in the US.

BP currently holds 50 per cent of SECCO, while Sinopec holds 30 per cent and Sinopec Shanghai Petrochemical Company Ltd 20 per cent.

Based in Shanghai, SECCO is a major producer of olefins - ethylene and propylene - together with polymers and other derivatives including polyethylene, polypropylene, acrylonitrile styrene, polystyrene, butadiene and other products.

BP said that it intends to use the proceeds from the sale for general corporate purposes.

Commenting on the sale, Rita Griffin, chief operating officer of BP Global Petrochemicals said, ''This decision aligns our petrochemicals business in China with our global focus on areas where BP has leading proprietary technologies and competitive advantage. China is a key region for our chemicals business and BP will continue to look for opportunities to build on our position in the country.''

BP entered the petrochemicals business in China in the 1970s through technology licensing and later through manufacturing joint ventures.

Apart from SECCO, BP has three other petrochemical manufacturing joint ventures in China: purified terephthalic acid (PTA) production in Zhuhai; and acetic acid and other acetyls production with YARACO in Chongqing and BYACO in Nanjing.

BP's business activities in China include exploration and development, petrochemicals manufacturing and marketing, aviation fuel supply, oil products retailing, lubricants, oil and gas supply and trading, LNG terminal and trunk line and the chemicals technology licensing.