BP said on Tuesday it had agreed to sell stakes in three fields in its Bruce assets in the North Sea to Serica Energy plc.
The company said it expects to receive around 300 million pounds ($398 million), with a majority of it in the next four years.
Serica said it would buy a 36 percent interest in Bruce, 34.83 percent in Keith and 50 percent in Rhum. BP (BP)
will retain a 1 percent stake in Bruce.
BP currently operates the Bruce assets, which comprise the Bruce, Keith and Rhum fields and related infrastructure assets.
Serica said it would pay BP an upfront payment of £12.8 million, a share of cash flows over the next four years, a consideration equivalent to 30 percent of BP’s post-tax decommissioning costs and several contingent payments dependent on future asset performance and product prices.
"We remain committed to the North Sea and continue to invest. We expect our production there to double to around 200,000 barrels equivalent a day by 2020 through new projects like Quad 204 and Clair Ridge," said Bernard Looney, BP's upstream chief executive.
The company has invested heavily in the North Sea in recent years, bringing its Quad 204 project - a multi-billion-pound redevelopment of the Schiehallion and Loyal fields, west of the Shetland Islands
- into production earlier this year.
BP is also is on track to produce first oil from the second phase of the Clair field in 2018.
The company denied a July media report which said that BP was thinking of putting its entire North Sea business up for sale.
Serica said that it expects the deal to boost net production by seven fold to over 21,000 barrels of oil equivalent
per day, of which over 85 percent is gas.
It expects the deal to add to cash flow and value immediately after closing. It has an effective date of January 1 and completion is expected in mid-2018, Serica said.
Reporting by Arathy S Nair