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BHP sells Browse stakes for US$1.63bn

Nicholas Grove  |  12 Dec 2012Text size  Decrease  Increase  |  

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Nicholas Grove is a Morningstar journalist.

 

BHP Billiton (BHP) on Wednesday said it had agreed to sell interests in the Browse gas region off Western Australia to PetroChina for US$1.63 billion in cash.

The interests comprise an 8.33 per cent stake in the East Browse Joint Venture and a 20 per cent stake in the West Browse Joint Venture, the world's biggest miner said.

The transaction is subject to regulatory approval and other customary conditions. Completion is expected in the first half of the 2013 calendar year, BHP said.

"This is an excellent opportunity for both companies. PetroChina has acquired an interest in a world-class gas resource and BHP Billiton has exited a non-strategic asset," BHP Billiton chief executive Petroleum, J Michael Yeager, said in a statement.

The Browse Joint Venture participants hold a right to offer to match the transaction with respect to BHP's interests in the East and West Browse Joint Ventures and have a customary period to consider whether to make an offer to match, BHP said.

Also on Wednesday, BHP's rival Rio Tinto (RIO) said it will sell its 57.7 per cent stake in South African copper miner Palabora Mining Company for US$373 million.

The purchaser is a consortium led by the Industrial Development Corporation of South Africa and China's Hebei Iron & Steel Group, Rio said.

"Palabora is a good business but is no longer a natural fit within Rio Tinto's portfolio," Rio Tinto chief financial officer Guy Elliott said.

"Selling our stake reflects Rio Tinto's policy of continually reviewing our portfolio to generate best value for shareholders.

"I expect Palabora to continue prospering under its new ownership. During the transition we will continue to run the operations efficiently and safely."

The sale is subject to customary regulatory approvals in South Africa and China, which are expected to take four to six months, Rio said.