ConocoPhillips (COP), the third-largest U.S. oil company, agreed to sell its Vietnam operations for $ 1.29 billion to Perenco SA, exiting the country after more than 15 years.
Closely held Perenco, based in Paris, produces oil and natural gas from basins in Brazil, Peru, Iraq, Australia and North Sea, according to its website.
Under the agreements signed with a unit of privately owned Perenco, Conoco would sell its three wholly owned subsidiaries that own stakes in two offshore blocks and 16.3 percent interest in the Nam Con Son Pipeline.
The Vietnam business unit sale is part of ConocoPhillips’ efforts to unload less profitable businesses and boost returns, the Houston-based company said in a statement today. The transaction is expected to close in the first half of 2012.
Conoco will split into two companies later this year, with one arm focused oil and gas production and the other on refining and market operations.
Conoco had targeted asset sales of $15 billion to $20 billion by the end of 2012.
ConocoPhillips’ stake in Vietnam may not have been meaningful enough for the company, said Pavel Molchanov, a Houston-based analyst with Raymond James & Associates Inc.
“It’s a country where there is growth potential, but it’s fairly difficult for Western majors to perhaps navigate it,” said Molchanov.