BP's $1bn North Sea sale hints at renewal of Abu Dhabi concession OIL major BP appears back on track to renew a key Middle Eastern contract following yesterday's agreement to sell a package of North Sea assets to the state-controlled energy firm of Abu Dhabi. Taqa, which is three-quarters owned by the Abu Dhabi government, will pay more than $1 billion (£625 million) for stakes in five BP oil fields. The deal brings the British group within touching distance of a targeted $38bn of disposals needed to shore up its balance sheet ahead of its trial over civil fines for the Deepwater Horizon disaster in the US. However, the agreement also suggests that BP might still win back a long-running oil concession that is the linchpin of its operations in the Middle East. BP has held a stake in a vast onshore field in Abu Dhabi - the capital and largest of the seven-member United Arab Emirates - since 1939. However, it was recently excluded from a list of bidders to renew the concession from 2014 amid political tensions over British criticism of crackdowns on extremist groups in the UAE. Yesterday's deal with Taqa comes weeks after a visit by Prime Minister David Cameron to the emirate aimed at mending relations between the two governments. The UAE has previously indicated that it has not yet made a final decision on the issue. The 9.5 per cent stake currently held by BP accounts for roughly 125,000 barrels of oil per day, or 3.5 per cent of the group's total global production. Leo Koot, managing director of Taqa's UK operations, said the newly-acquired BP assets would boost the state-owned company's North Sea production by nearly half to some 61,000 barrels of oil equivalent per day (boepd). "Our production increases dramatically, and on a reserves basis we will double the size of the company," Koot said, adding that plans were also in place to develop additional gas and oil reserves. Taqa's North Sea business also adds to the group's expertise in key areas of offshore operations - knowledge which can be deployed to its other activities around the globe. Koot said negotiations were aided by new tax breaks on mature North Sea assets. Those changes were announced by Chancellor George Osborne in September, adding to existing government concessions on small field allowances. BP said the deal made "strategic sense," as the company is looking to focus upon a smaller number of higher-value projects in the North Sea. Europe's second-largest oil group is within $1bn of completing its assets divestment programme, having now agreed disposals worth $37bn. BP chief executive Bob Dudley is shoring up the group's finances to help pay settlements from the Macondo oil spill in the Gulf of Mexico. The company, which still faces civil lawsuits from the Gulf disaster, was yesterday barred from winning new US government contracts until it can prove its meets business standards set by authorities in that country. BP is one of the largest suppliers of fuel to the US department of defence. BP has already pled guilty to criminal misconduct charges, leading to a record $4.5bn fine earlier this month.