BP PLC (LON:BP.) is to inject almost US$1bln (£800mln) into a gas field off the coast of west Africa as it looks to battle low energy prices by expanding its output.
The oil giant has signed an agreement with Kosmos Energy Ltd. (NYSE:KOS) to partner on its discoveries in Mauritania and Senegal and co-operate on future exploration.
Under the deal, BP will take a 62% stake in Kosmos's Mauritanian operation and a 32.5% holding in its Senegalese unit.
The moves comes in the wake of a deal struck over the weekend, which saw BP snap up a 10% stake in the output of one of the largest oilfields in Abu Dhabi.
READ: BP takes bigger Abu Dhabi share …
BP boss Bob Dudley said: "BP's entry into Mauritania and Senegal represents an exciting strategic opportunity to work with Kosmos Energy in an emerging world-class hydrocarbon basin.
"We believe our expertise in integrating the gas value chain, together with a talented exploration partner in Kosmos, along with the support of the Mauritanian and Senegalese governments, brings together all the elements needed to create a new liquefied natural gas hub in Africa."
BP said the total acreage under the deal, by Kosmos' estimates, could contain roughly 50 trillion cubic feet of gas resource potential and in excess of one billion barrels of liquids resource potential.
Under the terms of the agreements, the partners have agreed that Kosmos will remain the technical operator for the exploration phase of the project and drill three new exploration wells beginning in 2017.
AJ Bell investment director Russ Mould said: “The deal gives BP an exciting strategic opportunity to work with Kosmos to create a new LNG hub in Africa while the ADCO concession will give it long-term access to significant and competitive resources which it already understands very well.”
In early morning trading, BP shares were 0.8%, or 4.05p higher at 493.75p.
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