NEWS ANALYSIS: BP deal gives BHP a happy-ish ending to its US shale adventure
Even the most sorry tale can have something like a happy ending. That looks to be the case with BHP Billiton’s misbegotten foray into onshore US oil and gas. With the announcement Friday that the company will sell its assets in the Eagle Ford, Permian and Haynesville basins to BP for $10.5bn, the company’s US oil unit will be sticking to the deep seas. BHP is also selling BHP Billiton Petroleum (Arkansas) and BHP Billiton Petroleum (Fayetteville) to a unit of the Merit Energy Company for $300m. The price of the BP deal looks better than many had been expecting. At the time Elliott Management started pushing for a divestment of the assets in April last year, brokers valued them at an average of $6.5bn. First-round bids for the business from BP, Chevron and Royal Dutch Shell had come in at between $7bn and $9bn, people familiar with the matter told Kiel Porter and Dinesh Nair of Bloomberg News last month. By BHP’s own numbers, net operating assets in the three basins were worth about ...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.