BP is seeking to form joint ventures (JV) around its U.S. onshore natural gas fields to expand production and cut costs as rival energy giants rush to scale up shale businesses, three sources with direct knowledge of the talks told Reuters on Oct. 30.

However, interim BP CEO Murray Auchincloss told Reuters on Oct. 31 that rumors about the company’s shale business are “not true” and that the London-based supermajor has all the resources it needs.

According to an Oct. 30 report, three sources said BP held talks in recent weeks with several companies about tying up operations in the Haynesville Shale.

BP is also considering creating JVs in the Eagle Ford Shale, but the talks do not include its positions in the oil-rich Permian Basin for now, two of the sources added.

The JVs could cover leaseholds of varying sizes and would not have to be everything BP has within the basin.

The rapid growth in U.S. shale oil and gas operations over the past 15 years has upended global markets, turning the U.S. into a major exporter of energy.

But scale is key to maintaining low costs in the shale.

By increasing the size of its operations as part of a JV, BP and its partners would be able to drill more, longer shale wells to increase output, while sharing costs between the parties.

Auchincloss said BP doesn’t need additional U.S. resources.

“We have a ton of resources. They’re very high quality, and they’ve got incredible growth rates that rival what has been done by some of the competition,” Auchincloss said.

He would not comment directly on the Reuters report that BP was seeking to form JVs around its U.S. onshore natural gas fields but said that “these rumors in the press about BPX are not true” referring to BP’s shale business.

The push to grow has driven a wave of consolidation efforts among shale producers this year.

In October, Exxon Mobil and Chevron both announced plans to acquire rivals Pioneer Natural Resources and Hess, respectively, for a combined $113 billion, two of the largest mergers in the sector in decades.

By pursuing joint ventures, BP can achieve growth ambitions while avoiding spending billions on acquisitions. However, agreeing on the value of the combined assets and how to divide the venture's ownership are among the hurdles BP would have to clear with potential partners, the sources said.

BP plans to invest around $2.5 billion per year in its shale business, with an average of 12 to 15 rigs in operation. Production is expected to double to 650,000 barrels of oil equivalent per day (boed) by 2030 from 2022 levels, the company said in a presentation last month.

BP has natural gas reserves of 13 Tcf in the Haynesville, where it holds more than 500,000 net acres, it said.

The company already has a JV in the Eagle Ford with privately-held Lewis Energy since 2010. Since then, BP added to its position in the South Texas basin through the 2018 acquisition of BHP’s onshore U.S. operations for $10.5 billion.

BP aims to sharply slash greenhouse-gas emissions and grow renewable and low-carbon energy businesses in the coming decades.

Earlier this year the company scaled back plans to cut oil and gas output by 2030, targeting a 25% reduction from 2019 levels instead of the previous 40% reduction target, as investors press the board to focus on high-margin operations.

Auchincloss, who took over from Bernard Looney last month after his abrupt resignation for failing to disclose relationships with employees, told investors at an event in Denver this month that BP will be able to maintain oil and gas production steady for years.

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