Kerr-McGee to Sell Assets in North Sea for $3.5 Billion

Kerr-McGee Corp. announced Monday that it was selling all of its North Sea operations for $3.5 billion as it moves forward with efforts to reduce debt incurred in a huge stock buyback and focus on oil properties with the greatest growth potential.

Danish shipping giant A.P. Moller-Maersk is buying the majority of Kerr-McGee’s North Sea oil assets for $2.95 billion. Britain’s Centrica is buying four other fields from the Oklahoma City company for $566 million.

The company also plans to sell some oil properties in the Gulf of Mexico, while it accelerates drilling activities on properties in the Rockies.

Kerr-McGee has been aggressively changing its business portfolio after coming under pressure from shareholders led by financier Carl Icahn, who charged that the company wasn’t properly managed. He dropped a bid this year to sit on the board after Kerr-McGee agreed to sell its chemical business and to spend $4 billion to repurchase 29% of its shares.

The money from the sale of the oil properties will be used to reduce some of this debt. Divestitures are expected to ultimately represent about 30% of the company’s proven reserves of oil and 30% of its production.

Shares of the company rose $3.03, or 3.7%, to $85.01.

Tom Covington, an analyst for A.G. Edwards, who tracks the company, said the sale of the North Sea properties would help the company reach its goals of reducing debt and focusing on North American assets with the best growth potential.

“I think it is a big positive for the company,” he said. “They did receive a very attractive price.”