Mining heavyweight BHP Billiton Limited (ASX: BHP) has confirmed it is "marketing" its Fayetteville shale asset in Arkansas to potential suitors with the intention being to divest the field if (and only if) it maximises shareholder value.
BHP only purchased the field in 2011 from Chesapeake Energy, shortly before also acquiring the shale assets of Petrohawk Energy. The miner paid US$4.75 billion for the assets when gas prices were sitting above US$4 per unit and was forced to undertake a US$2.84 billion write-off roughly one year later as gas prices plummeted, sliding below US$2 per unit.
As it stands, gas prices have recovered significantly, making BHP Billiton believe now might be the time to sell. Selling the acreage, which Deutsche Bank values at around US$2.1 billion, would allow BHP to focus on the development of its high quality Haynseville gas field. The company said: "In time, we expect to fully develop our Haynesville gas field, given the quality of the acreage."
The announcement follows on from the miner's plans to divest its non-core assets to instead concentrate on maximising the value from its core operations, being iron ore, copper, coal and petroleum. The company plans to have the divestment complete sometime early in the 2015 calendar year.
