BHP To Buy Addl. 28% Working Stake In Shenzi From Hess In $505 Mln Deal

(RTTNews) - BHP Group Plc. (BHP.AX, BLT.L, BBL, BHP) announced Tuesday that it has signed a Membership Interest Purchase and Sale Agreement with Hess Corp. (HES).

The deal is to buy an additional 28 percent working interest in Shenzi, a six-lease development in the deepwater Gulf of Mexico. BHP and Hess have agreed to a purchase price of $505 million, subject to customary pre and post-closing adjustments.

The effective date of the transaction is July 1 with an expected close by December 2020, subject to the satisfaction or waiver of customary and transaction-specific conditions.

Shenzi is structured as a joint ownership, in which BHP is the operator with 44 percent interest. Along with Hess's 28 percent stake, Repsol S.A. also holds 28 percent interest.

Following the acquisition from Hess, BHP's working interest in Shenzi would rise to 72 percent and immediately add approximately 11,000 barrels of oil equivalent per day of production.

The company said the transaction is consistent with its strategy of targeting counter-cyclical acquisitions in high-quality producing or near producing assets.