(Reuters) - BP (L:BP) said on Monday it had amended financial terms of the $5.6 billion (4.5 billion pounds) sale of its Alaska business to privately held Hilcorp Energy Co following the recent slump in oil prices, which may lead to a lower cash boost than initially planned.
The new agreement retains the original sale price but provides for vendor financing, smaller payments in 2020 and for cash flow sharing in the near-term, the British oil major said.
The new structure is, however, expected to maintain "the majority of the value of the transaction," BP said in its statement.
Details on timing of the payouts or amounts of the financing were not disclosed. BP is scheduled to release first-quarter results on Tuesday and could provide additional details, a spokeswoman said.
BP shares were up a fraction at $23.47 Monday morning.
Hilcorp declined comment on new terms including BP-provided financing on the deal.
"In the weeks ahead, we will continue to work with BP, the State of Alaska, and others to ensure a seamless transition process as we complete this transaction," said Hilcorp President Jason Rebrook in a statement.
The original agreement provided for Hilcorp to pay $4 billion this year and another $1.6 billion through an earnout over time. Hilcorp paid a $500 million deposit on signing of the transaction in 2019, BP said.
The company still expects to complete the deal in mid-2020.
U.S. crude oil futures fell into negative territory last week for the first time in history, dragged down by a supply glut and sagging demand for crude due to the coronavirus pandemic. U.S. oil futures were trading at $12.28 a barrel on Tuesday.
BP agreed to sell all its Alaskan properties, including interests in the most prolific oil field in U.S. history at Prudhoe Bay and the 800-mile (1,300-km) Trans Alaska Pipeline, to Hilcorp last year, exiting a region where it operated for 60 years.