On completion of the transaction, BHP’s oil and gas business would merge with Woodside, and Woodside would issue new shares to be distributed to BHP shareholders. The expanded Woodside would be owned 52% by existing Woodside shareholders and 48% by existing BHP shareholders.
The merger is expected to be completed in the second quarter of the 2022 calendar year with an effective date of 1 July 2021.
On a proforma basis, the combined business will consist of an asset base producing around 200 million boe (FY21 net production), a production mix of 46% LNG, 29% oil and condensate and 25% domestic gas and liquids (FY21 net production) and 2P reserves of over 2 billion boe comprising 59% gas, and 41% liquids.
Woodside and BHP have developed a plan to targeted final investment decision (FID) for Scarborough (Australia) by the end of the 2021 calendar year, prior to the proposed completion date for the merger.
As part of this plan, Woodside and BHP have agreed an option for BHP to sell its 26.5% interest in the Scarborough Joint Venture to Woodside and its 50% interest in the Thebe and Jupiter joint ventures to Woodside if the Scarborough Joint Venture takes a FID by 15 December 2021. The option is exercisable by BHP in the second half of the 2022 calendar year and if exercised, consideration of US$1 billion is payable to BHP with adjustment from an effective date of 1 July 2021. An additional US$100 million is payable contingent upon a future FID for a Thebe development.
The Atlantis Phase 3 (US), Mad Dog Phase 2 (US), Shenzi North (US) and Sangomar Field Development Phase 1 (Senegal) projects remain on budget and on track.
Longer term embedded options include the Wildling (US), Trion (Mexico), Calypso (Trinidad and Tobago) and Browse (Australia) projects.
Read the latest issue of Oilfield Technology in full for free: Issue 2 2021
Oilfield Technology’s second issue of 2021 starts with a report from KPMG that examines the outlook for the Scottish oil and gas sector. The rest of the issue is dedicated to articles covering the offshore supply chain industry, offshore asset integrity, expandable liner technology, advances in drilling, data security, flow control, EOR and methane emissions.
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Read the article online at: https://www.oilfieldtechnology.com/drilling-and-production/17082021/woodside-and-bhp-commit-to-oil-and-gas-business-merger/