BP (NYSE: BP) To Sell $7 Billion in Assets to Apache Corp (NYSE:APA)

BP (NYSE: BP) has agreed to sell $7 billion worth of oil and natural gas fields in the United States and abroad to Apache Corp (NYSE: APA) in its largest-move to date to raise money to pay for reparations for the Gulf of Mexico oil spill.

The company announced that it would sell its Permian Basin fields in Texas and New Mexico which were acquired as part of the company’s purchase of Arco in 2000, was well as various properties in Canada and Egypt. Apache was reportedly interested in BP’s assets in Alaska, but they were not included in the deal.

Last month, BP agreed to setup a $20 billion claims fund for disaster victims. The company formerly known as British Petroleum planned to finance the fund by suspending its dividend for the rest of the year, reducing capital spending and selling $10 billion worth of asets.

“This is a good deal for BP because it frees up more cash if they need it,” said Phil Flynn, energy analyst for PFGBest Research in a research note to investors on Tuesday. “I think [Apache] looked at this as a once-in-a-lifetime opportunity that they just couldn’t pass up,” Flynn said.

The announcement came days after BP placed a cap over  the well, which had been gushing oil since the April 20^th explosion of the Deepwater Horizon drilling rig in the gulf, which resulted in the death of eleven workers. The spill has since become the largest spill in United States history.

BP Chairman Carl-Henric Svanberg said in a statement that the assets were not critical to BP’s post-spill plans. “Over the last two months the board has considered BP’s options for generating the cash necessary to meet the obligations likely to arise from the Gulf of Mexico oil spill,” Svanberg said. “The board believes that there are opportunities to divest assets which are strategically more valuable to other parties than they are to BP.”