LONDON/NEW YORK Oct 22 BHP Billiton,
the world's largest mining company, plans to sell roughly half
its acreage in the Permian Basin - a revived oil and gas region
in Texas and New Mexico - as it focuses on its most lucrative
BHP, already a significant oil and gas player, moved heavily
into U.S. shale in 2011, acquiring Fayetteville assets from U.S.
energy group Chesapeake and months later later Petrohawk
Energy, spending almost $17 billion - $20 billion, including
debt - just before a major downturn in U.S. natural gas prices.
The mining giant, also faced with cooling prices for its key
mined commodities, has since been trimming across its divisions
to focus on its more profitable core operations. It confirmed on
Tuesday it was selling down in the Permian Basin to concentrate
on acreage there that "holds the most interest".
"The drilling program has now defined our primary area of
focus in the basin and, while this program is at a relatively
early stage, we see the potential to build a sizeable business,"
a BHP spokeswoman said.
"As we continue with our evaluation, we will concentrate our
efforts on the acreage that holds the most immediate interest
for us while divesting some other parts of our holdings."
According to a request for proposals from adviser Scotia
Waterous and dated Oct. 16, BHP is selling 250,000 net acres in
west Texas - 165,000 net acres in the Delaware Basin and the
remainder in the Midland Basin.
That compares to BHP's total of 500,000 net acres in the
broader Permian Basin, according to its latest annual report.
BHP declined to comment on how much of the acreage up for
sale came from the 2011 Petrohawk acquisition, which gave BHP
325,000 net acres in the Permian, described at the time as
primarily oil, highly scaleable and with "significant upside
potential". The remaining acres were acquired separately.