BHP Multinational Mining Begin Talks To Exit Oil And Gas Industry | horse

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Multinational miner BHP has begun talks to exit the oil and gas industry by merging its hydrocarbon business with Australia’s largest independent gas producer, Woodside Petroleum.

BHP said the merger with Woodside was one option being evaluated as part of a strategic review of its oil and gas business, and its place in the company’s long-term portfolio.

BHP added that the Woodside merger and its oil and gas business, estimated to be worth between $13 billion and $15 billion, could include the distribution of shares in Woodside to BHP shareholders, but “no agreement has been reached regarding any such transaction.”

The talks emerged after recent speculation that BHP intends to divest its oil and gas assets, which range from oil and gas fields in Australia, Algeria and the Gulf of Mexico, to focus on producing minerals that can aid the green energy transition.

The $181 billion Anglo-Australian miner, which owns one of the world’s largest copper mines, earns the majority of its profits from producing iron and copper ore and plans to accelerate its shift toward these raw materials used in electricity infrastructure.

Saul Kavonic, an analyst at Credit Suisse Group, said BHP’s petroleum division “simply no longer fits BHP’s portfolio or future-facing strategy.”

“BHP should know that it is better to get out of petroleum sooner rather than later,” he added.

BHP has halved its oil and gas production in recent years after selling its US shale business to BP in 2018. The company’s oil and gas production fell from 235 million barrels in 2013 to about 103 million barrels in the 12 months to June.

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Contributors have criticized BHP’s continued investment in oil and gas, which is directly linked to the sharp rise in carbon dioxide emissions into the atmosphere responsible for the climate crisis.

At the company’s annual shareholder meeting last October, its president, Ken McKenzie, said that while BHP accepted “the science about climate change” and supported the Paris climate agreement, the reality is that all current plausible scenarios show that fossil fuels will be part of the energy mix. for decades.”

BHP CEO Mike Henry said the company saw oil and gas as “something to invest in in the short and medium term.”

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