BHP Billiton announces plans to exit US Lower 48 Report

Insight 08 September 2017

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Report summary

BHP Billiton's planned exit from the US Lower 48 flies in the face of industry trends. Operators that have built prime growth portfolios in unconventionals, tight oil in particular but gas too, are the envy of the ‘have nots’. The ‘haves’, like BHP Billiton, typically look to high grade and expand, taking advantage of economies of scale and technological know-how. Besides being prompted by activist investor Elliott Advisors, BHP Billiton’s motivation to sell is driven by a need for greater focus across its diversified commodities business, and a desire to realise value from assets which would be more highly prized by others. The US Lower 48 currently represents less than 10% of the conglomerate’s entire Enterprise Value.

Executive summary
BHP calls time on US Unconventionals
US Lower 48 portfolio: what is up for grabs?
US Lower 48 portfolio monetisation options
What does this mean for BHP's remaining E&P business?
Appendix:
- BHP global upstream portfolio summary
- US Lower 48 portfolio benchmarking
- US Lower 48 asset benchmarking