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BHP to acquire additional interest in Shenzi
BHP Group Plc
Registration number 3196209
Registered in England and Wales
Share code: BHP
ISIN: GB00BH0P3Z91
NEWS RELEASE
Release Time IMMEDIATE
Date 6 October 2020
Release Number 16/20
BHP to acquire an additional 28 per cent working interest in Shenzi from Hess
BHP today announced that it has signed a Membership Interest Purchase and Sale
Agreement with Hess Corporation (Hess) to acquire an additional 28 per cent
working interest in Shenzi, a six-lease development in the deepwater Gulf of Mexico.
Shenzi is structured as a joint ownership: BHP (Operator, 44 per cent interest); Hess
(28 per cent interest) and Repsol S.A. (28 per cent interest).
BHP and Hess have agreed to a purchase price of US$505 million, subject to
customary pre and post-closing adjustments.
The acquisition would bring BHP’s working interest to 72 per cent and immediately
add approximately 11,000 barrels of oil equivalent per day of production (90 per cent
oil).
This transaction is consistent with our strategy of targeting counter-cyclical
acquisitions in high-quality producing or near producing assets. While our strict
Capital Allocation Framework tests ensure all investments are resilient to low points
in the commodity cycle, we also recognise the potential for price upside over the
medium term given the global slowdown in development activity, and we are well
positioned to participate in that upside. We continue to believe that the fundamentals
for oil and advantaged gas will be attractive for the next decade and likely beyond.
BHP President Petroleum Operations, Geraldine Slattery said: “This transaction
aligns with our plans to enhance our petroleum portfolio by targeted acquisitions in
high quality producing deepwater assets and the continued de-risking of our growth
options. We are purchasing the stake in Shenzi at an attractive price, it’s a tier one
asset with optionality, and key to BHP’s Gulf of Mexico heartland. As the operator, we
have more opportunity to grow Shenzi high-margin barrels and value with an
increased working interest.”
The effective date of the transaction is 1 July 2020 with an expected close by
December 2020, subject to the satisfaction or waiver of customary and transaction-
specific conditions.
Further information on BHP can be found at: bhp.com
Sponsor: UBS South Africa (Pty) Limited
Authorised for lodgement by:
Caroline Cox
Group General Counsel & Company Secretary
Media Relations Investor Relations
Email: media.relations@bhp.com Email: investor.relations@bhp.com
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Tel: +61 3 9609 3830 Mobile: +61 411 071 715 Tel: +61 3 9609 2222 Mobile: + 61 499 249 005
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BHP Group Limited ABN 49 004 028 077 BHP Group plc Registration number 3196209
LEI WZE1WSENV6JSZFK0JC28 LEI 549300C116EOWV835768
Registered in Australia Registered in England and Wales
Registered Office: Level 18, 171 Collins Street Registered Office: Nova South, 160 Victoria Street
Melbourne Victoria 3000 Australia London SW1E 5LB United Kingdom
Tel +61 1300 55 4757 Fax +61 3 9609 3015 Tel +44 20 7802 4000 Fax +44 20 7802 4111
Members of the BHP Group which is
headquartered in Australia
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Date: 06-10-2020 07:05:00
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