"Flush with cash and the only bidder in the room - it's a dream...

"Flush with cash and the only bidder in the room - it's a dream position for BHP Billiton if it wants to take a tilt at Woodside Petroleum. But it's a lousy bind to be in for the seller of Woodside shares - Shell.

Shell took the unusual step of selling 10 per cent of Woodside to the broader market last night. It suggests that if there was a corporate buyer out there they were not putting their hand up when investment bank auctioneer UBS came calling.

But when there is only one potential buyer the rules of the game get changed.

Advertisement: Story continues below If BHP is genuinely interested in taking Woodside it has no need to do much at all. It would have been perfectly happy to see Woodside's shares sell at a 7 per cent discount to the market.

Whoever bought that stock will be happy enough to sell into a takeover bid at a 30 per cent premium down the track.

It might seem a bit of an assumption to say that BHP Billiton is the only buyer. It is based on the fact that the Howard Government banned Shell from a $10 billion bid nine years ago.

And that was at a time when the Coalition had a firm grip on political power.

Canberra today is a minefield of minority interests - many of which are commercial irrationalists but have loudspeakers and plenty of sway.

Against this backdrop it's hard to see Labor giving approval for a foreign player to buy a major part of Australia's liquefied natural gas assets.

That just leaves BHP which has just been left at the altar by the Canadians and the market reckons is on the rebound.

The match appears to be so perfect.

But BHP is in a position to dictate the timing and there are other oil and gas assets on the market so it might want to do some more scoping before it commits to Woodside.

Shell has said it won't sell any more of the remaining 24.2 per cent for a year

http://www.smh.com.au/business/shell-shocked-but-for-bhp-woodsides-a-dream-20101109-17lcb.html