BHP has sold its US oil shale assets for $14.6 billion cash

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  • BHP is selling it US onshore oil and gas assets for $US10.8 billion.
  • The net proceeds will be returned to shareholders.
  • However, the deal is below book value and the miner expects to book an impairment charge of $US2.8 billion.

BHP is selling its entire interests in the Eagle Ford, Haynesville, Permian and Fayetteville Onshore US oil and gas fields for $US10.8 billion ($14.6 billion) in cash.

The sale, within analyst expectations of $US8 billion to $US10 billion but below book carrying value of $US13 billion, is covered in two deals.

BHP expects to recognise an impairment charge of $US2.8 billion post tax against the carrying value of its onshore US assets.

“The sale of our Onshore US assets is consistent with our long-term plan to continue to simplify and strengthen our portfolio to generate shareholder value and returns for decades to come,” says BHP chief executive officer Andrew Mackenzie.

Mackenzie says he expects to return the net proceeds from the transactions to shareholders.

“We will confirm how, and when, at the time of completion of the transactions,” he says.

BP American Production Company, a wholly owned subsidiary of BP Plc, has agreed to buy 100% of the issued share capital of Petrohawk Energy Corporation, the BHP subsidiary which holds the assets, for $US10.5 billion.

And MMGJ Hugoton III, a company owned by Merit Energy Company, has agreed to acquire 100% of the issued share capital of BHP Billiton Petroleum (Arkansas) Inc and 100% of the membership interests in BHP Billiton Petroleum (Fayetteville) LLC, which hold the Fayetteville assets, for a total consideration of $US300 million.

BHP has announced or completed more than $US18 billion of divestments over the last six years.

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