BP and Aker are contemplating the sale of 5% of their Norwegian oil and gas joint venture, Aker BP, to capture some of the value the company has generated since its creation five years ago.

The stake in Aker BP would be worth roughly $700 million based on Wednesday's share price.

Stay a step ahead with the Upstream News app
Read high quality news and insight on the oil and gas business and its energy transition on-the-go. The News app offers you more control over your Upstream reading experience than any other platform.

The potential block sale of Aker BP shares was announced as international benchmark Brent crude oil prices traded above $82 per barrel on Wednesday, higher than pre-pandemic levels as oil demand has roared back after the Covid-19 lockdowns.

Aker BP's share price plunged to about $8 in March 2020 as oil prices collapsed during the early days of the pandemic, but the share price has since rebounded to around $40. Aker holds about 40% and BP has about 30% of the shares outstanding in Aker BP.

The sale, through an accelerated book-building process, would involve BP divesting about 2.1% of Aker BP's outstanding shares and Aker selling about 2.9%. "This transaction will enable BP to realise some of the considerable value Aker BP has already generated while remaining committed to its ongoing success and value creation for shareholders," BP chief executive Bernard Looney said in a statement on BP's website.

BP expects the divestment proceeds to further strengthen its balance sheet and support its share buy-back commitment, Looney said. Aker highlighted its ongoing commitment to the joint venture with BP.

"Aker BP is, and will remain, a core holding in Aker’s portfolio," Oyvind Eriksen, president and chief executive of Aker ASA, said in the statement.

Through the offering, Aker also aims to free up liquidity, diversify and continue growing its portfolio, Eriksen said.

Once the sale is completed, BP's and Aker's remaining shares in Aker BP will enter a six-month lock-up, subject to certain exemptions, BP said.