VRS - there you go. Do your own due -dil....buddy ha ha haBHP...

VRS - there you go. Do your own due -dil....buddy ha ha ha

BHP could spear African oil asset

Edited by Sarah Thompson
Heading into reporting season, the expectation is that BHP Billiton will announce more capital management
initiatives alongside the release of its annual result ? barring a major acquisition. The sense in the market is
that BHP boss Marius Kloppers would be keener to seal a successful deal than to announce another major
share buyback.
BHP approached Potash Corp of Saskatchewan last year just ahead of the release of its results in August,
relieving pressure to return cash to shareholders at the time.
With that in mind, there is industry chatter that it may be sniffing around African oil opportunities.
The Big Australian has large petroleum businesses in the US and Australia, but it has been notably absent
from the major finds offshore from West Africa (and Brazil for that matter).
One idea being floated in the market is a bid for Tullow Oil, which among its assets owns 36.5 per cent of the
giant Jubilee oilfield offshore Ghana. Tullow has a market value of ?11.8 billion ($17.6 billion), with 37 million
barrels of oil-equivalent production expected this year. (Locally, Tullow is perhaps best known for buying
Australian-listed Hardman Resources for $1.5 billion in 2006, which gave it promising ground in Uganda).
BHP?s $US4.75 billion ($4.41 billion) acquisition of the Fayetteville shale gas assets has helped fill a hole in its
production caused by drilling delays in the Gulf of Mexico, but the Arkansas field produces lower-margin gas
rather than higher-margin oil.
Adding Tullow?s existing production ? and its extensive growth prospects ? could therefore be an interesting
proposition for BHP. But it might also spark competition from cashed-up Chinese state-owned oil companies.
Should BHP decide to make a smaller entry into the region, another option would be the purchase of Kosmos
Energy, which owns 23.49 per cent of the Jubilee oilfield. Kosmos rejected a $US5 billion bid from CNOOC
and Ghana National Petroleum Corp last year in favour of a float. It now has a market value of $US6.7 billion.