BHP Plans Sale to Trim Down West Texas Shale Assets
LONDON/NEW YORK, Oct 22 (Reuters) - BHP Billiton plans to sell roughly half its oil and gas acreage in the Permian Basin in Texas and New Mexico, an area revived by the shale boom, to focus on its most lucrative assets there.
BHP, already a significant oil and gas player, moved heavily into U.S. shale in 2011, acquiringFayetteville assets from U.S. energy group Chesapeake and months later later Petrohawk Energy, spending almost $17 billion - $20 billion, including debt - just before a major downturn in U.S. natural gas prices.
The world's largest mining company, also faced with cooling prices for its mined commodities, has since been trimming across its divisions to focus on its more profitable core operations. It confirmed on Tuesday it was selling down in the Permian Basin to concentrate on acreage there that "holds the most interest".
"The drilling program has now defined our primary area of focus in the basin and, while this program is at a relatively early stage, we see the potential to build a sizeable business," a BHP spokeswoman said.
"As we continue with our evaluation, we will concentrate our efforts on the acreage that holds the most immediate interest for us while divesting some other parts of our holdings."
According to a request for proposals from adviser Scotia Waterous and dated Oct. 16, BHP is selling 250,000 net acres in west Texas - 165,000 net acres in the Delaware Basin and the remainder in the Midland Basin.
That compares to BHP's total of 500,000 net acres in the broader Permian Basin, according to its latest annual report.
View Full Article
WHAT DO YOU THINK?
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
Operates 2 Offshore Rigs
- Private Oil Made a Big Find in Mexico. Now State Oil Wants a Cut (Oct 04)
- BHP Gearing Up to Start Drilling for Oil in Mexico's Deep Waters (Oct 02)
- BHP To Quit US Shale Business As Annual Profit Surges (Aug 22)