BHP Billiton Ltd. (NYSE: BHP) has put its Fayetteville shale gas assets in the U.S. back on the block, the world's largest miner said April 26, as it seeks to focus on more lucrative opportunities in oil.
BHP first tried to sell the Fayetteville assets more than two years ago, having made the shale gas investment in 2011 before writing it down by $2.8 billion a year later after gas prices dropped.
But it shelved the idea of a sale in February 2015, saying at the time it planned to "maximize value" of the assets. BHP valued the business at $919 million at the end of 2016, according to its annual accounts.
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In a corporate operations review published April 26, BHP said the gas-rich Fayetteville Field in Arkansas was under review and that it was now "considering all options, including divestment."
Macquarie Bank analysts in a note said divestment of Fayetteville was the most likely course of action.
Analysts have linked the revived sale to activist investor Elliott Management's call earlier this month for BHP to spin off its petroleum division, much as BHP did with the aluminum and other non-core operations when it created South 32 in 2015. BHP has rejected the call by Elliott, which claims to hold a 4.1% interest in BHP's U.K.-listed shares.
BHP on April 26 denied any link between Elliott's move and prospects for Fayetteville including divestment and said the move was instead part of an ongoing review.
Within the petroleum business, BHP has long made it clear it intends to focus on liquid products in the United States, a more lucrative business than dry gas.
In February, it agreed to spend $2.2 billion to fund its share of investment for the second phase of the Mad Dog oil field in the Gulf of Mexico.
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