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BIL
BIBLT
BIL - BHP Billiton Plc - Announces Acquisition of Chesapeake Energy
Corporation`s Fayetteville USA, Shale assets
BHP Billiton Plc
Share code: BIL
ISIN: GB0000566504
Date 22 February 2011
Number 05/11
BHP BILLITON ANNOUNCES ACQUISITION OF CHESAPEAKE ENERGY CORPORATION`S
FAYETTEVILLE USA,
SHALE ASSETS
BHP Billiton today announced it has agreed to acquire all of Chesapeake Energy
Corporation`s (Chesapeake) interests in the Fayetteville Shale, USA, including
the midstream pipeline system, for US$4.75 billion, which BHP Billiton expects
to fund from the Group`s cash resources.
The acquisition is consistent with BHP Billiton`s strategy of investing in
large, long-life, low cost assets with significant volume growth from future
development. It also supports our goal of diversification by geography,
customer and product. BHP Billiton will become the operator of Chesapeake`s
operated interests in the field.
Chesapeake`s Fayetteville shale assets include approximately 487,000 acres of
leasehold and producing natural gas properties located in Arkansas, USA. This
is the second largest position in one of the largest gas fields in the world.
This acquisition will increase BHP Billiton`s net reserve and resource base by
45 per cent. These assets currently produce over 400 million cubic feet of
gas per day and include development options that will support substantially
higher production over a 40 year operating life. BHP Billiton and Chesapeake
have also agreed a 12 month services agreement to ensure the safe transfer of
operations to BHP Billiton.
The assets acquired generate strong margins and returns on capital at today`s
prices. Depending on regulatory approvals, BHP Billiton expects to close in
the first half of 2011.
"The Fayetteville Shale is a world-class onshore natural gas resource," said
J. Michael Yeager, Chief Executive of BHP Billiton Petroleum. "This
transaction marks BHP Billiton`s entry into the US shale gas business. The
operated position we are obtaining will immediately make BHP Billiton a major
North American shale gas producer. It provides access to a competitive, long-
life resource basin that benefits from our ability to invest through the
economic cycles. Longer term, the expertise we gain here will be usable
elsewhere as we continue to grow our business."
CAPITAL MANAGEMENT PROGRAM - A$5 BILLION OFF-MARKET BUY-BACK
BHP Billiton also announces an Off-Market tender Buy-Back (Off-Market Buy-
Back) of BHP Billiton Limited shares that will form an important part of its
expanded US$10 billion capital management program (see separate announcement).
The Off-Market Buy-Back, with a target size of A$5 billion but which BHP
Billiton Limited may vary at its discretion, will commence immediately in
accordance with the Off-Market Buy-Back timetable, which is separately
available. The On-Market Buy-Back of BHP Billiton Plc shares will continue,
including over the period of the Off-Market Buy-Back process.
Important notice:
This press release does not constitute, or form part of, any offer or
invitation to sell, or any solicitation of any offer to purchase any
securities in any jurisdiction, nor shall it or the fact of its distribution
be relied on in connection with any contract thereof. No indications of
interest in the Off-Market Buy-Back are sought by this press release, which
relates to the BHP Billiton capital management program. Shareholders who are
(or nominees who hold BHP Billiton Limited shares on behalf of or for the
account of persons who are) in the United States or US persons, (within the
meaning of Regulation S under the United States Securities Act of 1933)
residents of Canada or who are otherwise excluded foreign persons will not be
eligible to participate in the Off-Market Buy-Back described in this press
release. ADRs and restricted employee shares may not be tendered into the Off-
Market Buy-Back. Off-Market Buy-Back documents, including the booklet
describing the terms of the Off-Market Buy-Back and tender forms, when issued,
will not be distributed or sent into the United States or Canada.
Further information on BHP Billiton can be found on our Internet site:
www.bhpbilliton.com
Australia United Kingdom & South Africa
Brendan Harris, Investor Andre Liebenberg, Investor Relations
Relations Tel: +44 20 7802 4131
Tel: +61 3 9609 4323 Mobile: +44 7920 236 974
Mobile: +61 437 134 814 email: Andre.Liebenberg@bhpbilliton.com
email:
Brendan.Harris@bhpbilliton.com United Kingdom & Americas
Ruban Yogarajah, Media Relations
Amanda Buckley, Media Relations Tel: US +1 713 966 2907 or
Tel: +61 3 9609 2209 UK +44 20 7802 4033
Mobile: +61 419 801 349 Mobile:UK +44 7827 082 022
email: Amanda.Buckley@bhpbilliton.comemail: Ruban.Yogarajah@bhpbilliton.com
Kelly Quirke, Media Relations Americas
Tel: +61 3 9609 2896 Scott Espenshade, Investor Relations
Mobile: +61 429 966 312 Tel: +1 713 599 6431
email: Kelly.Quirke@bhpbilliton.comMobile: +1 713 208 8565
email: Scott.Espenshade@bhpbilliton.com
Fiona Martin, Media Relations
Tel: +61 3 9609 2211
Mobile: +61 427 777 908
email: Fiona.Martin2@bhpbilliton.com
BHP Billiton Limited ABN 49 004 BHP Billiton Plc Registration number
028 077 3196209
Registered in Australia Registered in England and Wales
Registered Office: 180 Lonsdale Registered Office: Neathouse Place
Street London SW1V 1BH United Kingdom
Melbourne Victoria 3000 Australia Tel +44 20 7802 4000
Tel +61 1300 55 4757 Fax +44 20 7802 4111
Fax +61 3 9609 3015
Members of the BHP Billiton group which is headquartered in Australia
Date: 22/02/2011 07:05:45 Produced by the JSE SENS Department.
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