BHP to sell onshore US oil and gas assets for $US10.8bn

BHP's Fayetteville shale asset. Image: BHP

BHP has entered into agreements for the sale of its interests in the Eagle Ford, Haynesville, Permian and Fayettville onshore US oil and gas assets for a combined base cash consideration of $US10.8 billion ($14.2 billion).

According to a statement from BHP, BP subsidiary BP American Production Company has agreed to acquire 100 per cent of Petrohawk Energy Corporation, the BHP subsidiary which holds the Eagle Ford, Haynesville and Permian assets, for a consideration of $US10.5 billion.

MMGJ Hugoton III, a subsidiary of Merit Energy Company, has agreed to acquire 100 per cent of the issued share capital of BHP Billiton Petroleum Arkansas and 100 per cent of the membership interests in BHP Billiton Petroleum Fayetteville — the holder of the Fayetteville assets — for a total consideration of $US0.3 billion.

BHP said both sales are subject to the satisfaction of customary regulatory approvals and conditions precedent.

We are pleased that we have agreed to sell all of our shale assets in two simple transactions that provide certainty for shareholders and our employees, BHP chief executive officer Andrew Mackenzie said in the statement.

Mackenzie said the sale of the BHPs onshore US assets is consistent with the companys long-term plan to continue to simplify and strengthen its portfolio to generate shareholder value and returns for decades to come.

BHP will continue to operate the assets until completion and will work closely with the purchasers to ensure a smooth transition of ownership.

The business expects completion to occur by the end of October 2018.