BP's Global Assets: To Sell or Not to Sell?

NEW YORK (TheStreet) -- It's suddenly become all or nothing for BP(BP) in the oil spill crisis. BP bankruptcy fears led to Wednesday's sudden plunge in BP shares to a 14-year low, but bankruptcy may not be a more likely outcome than individual asset sales by BP to calm the financial panic.

When market prudence gave way to BP panic on Wednesday (followed this morining, by a 10% spike in the pre-market), some analysts seemed frustrated, if not downright miffed, that BP was trading below $30, arguing that the panic button triggered by the oil spill had superseded investment logic.

It's hard to say. In BP's mismanagement of the oil spill, one can make the case that prudence and panic have become interchangeable terms.

The BP panic leads to some natural M&A questions for BP management: If fear of an impending BP bankruptcy are hyperbole, and the federal government isn't about to place the oil giant in receivership, does the panic mean BP can't avoid a takeover by one of its global oil peers? Or will the prudent approach for BP be to sell off some select individual assets?

When BP CEO Tony Hayward reminded investors on last Friday's conference call that BP has a great global portfolio of assets, his intention was not to make a subtle sales pitch to energy-sector peers, but rather, to remind anxious investors that the BP business extends well beyond the Gulf of Mexico.

Looking under the hood of the BP global portfolio, though, it is striking just how important the Gulf of Mexico is to the oil giant's strategic growth.

Ironically, BP did us all a favor in March, just a month before the oil spill crisis ensued, when it pitched an investor presentation showing what it considers to be its assets strong suits.

With a deepwater disaster now dominating BP's business and the outlook for the company's existence, the slide from the March investor presentation reproduced above is one that BP might prefer to have back now.

In the least, it helps to place into focus the fact that BP has a ton of deepwater assets, among other offshore and onshore oil and gas reserves and exploration projects, that will be part of the M&A discussion.