Tesoro to sell domestic exploration and production

Petroleum News Alaska Staff

Tesoro Petroleum Corp. said Oct. 8 that it will sell all of its domestic exploration and production business to EEX Corp. for $216 million.

Tesoro said the business being sold consists of the company’s four core areas of domestic exploration and production operations in Texas and Louisiana, including extensive acreage. During the first six months of 1999, Tesoro’s domestic E&P operations generated approximately $21 million in operating segment earnings from production of 79 million cubic feet equivalent per day of natural gas and condensate.

“We are in the final phase of evaluating opportunities for our upstream operations that are located in Bolivia,” said Bruce A. Smith, Tesoro’s chairman, president and CEO. “But with this transaction, we take another step in the company’s long-term strategy to focus on downstream operations by improving our capital structure. The proceeds from this sale will be used to reduce Tesoro’s term debt debt-to-capitalization ratio to approximately 35 percent.”