ONGC, ConocoPhillips announce deal

U.S. energy giant ConocoPhillips plans to sell its 8.4 percent stake in Kazakhstan's Kashagan oil field to India's state-run outfit for about $5 billion. The Houston-based company said the sale to the international arm of India's Oil and Natural Gas Corp. is expected to close in the first half of 2013, subject to, among other things, various government approvals. The sale relates to ConocoPhillips' interest in the Kashagan in the Kazakh sector of the Caspian Sea. "Expected proceeds are approximately $5 billion, which represents the purchase price plus expected working capital and customary adjustments at closing," the company said. With the latest deal, ConocoPhillips said its proceeds from its asset sales would total about $7 billion "and strongly position the company to accomplish its target of $8-$10 billion by the end of 2013." The oil field is one of the biggest discoveries in recent decades, but its development has been plagued by delays. "The sale of this quality asset is an important component of our ongoing strategic asset disposition program," said Don Wallette, company executive vice president of commercial, business development, and corporate planning. "We are pleased that ONGC Videsh recognizes the value of this asset." The company said at the end of September the carrying value of its interest in Kashagan was about $5.5 billion and that it expects to show an after-tax impairment of about $400 million in the fourth quarter.