Energy

BHP approves funding for Shenzi North, Trion oil projects in Mexico

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Aug 6 (Reuters) - Global miner BHP Group (BHPB.L), (BHP.AX) said on Friday it would spend $544 million to develop its Shenzi North oil project in the Gulf of Mexico, and approved advancing its Trion oil project in Mexico into the design and engineering phase.

BHP, which is the operator of Shenzi North and holds a 72% stake in it, said the project will add two wells and underwater equipment to establish a new drill with the capacity to produce up to about 30,000 barrels of oil equivalent per day.

Spanish oil company Repsol SA (REP.MC), which owns the rest of the Shenzi North project, is expected to make a final investment decision (FID) later this year.

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BHP also agreed to spend $258 million to identify technical issues and cost estimates for its 60%-owned Trion project, with plans to conduct an FID in calendar 2022 with the other stake holder, Mexico's state-owned petroleum firm PEMEX.

"Both Shenzi North and Trion are strong growth assets for our business, providing attractive returns from relatively low carbon intensity resources," Geraldine Slattery, BHP's president of petroleum operations, said in a statement.

Production from the Shenzi North project is expected to start in fiscal 2024, the miner said.

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Reporting by Sameer Manekar in Bengaluru; Editing by Maju Samuel

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