BHP BILLITON TO ACQUIRE PETROHAWK

BHP Billiton Ltd. (BHP), the world’s largest mining company, agreed to acquire Petrohawk Energy Corp. for $12.1 billion in cash to extend its shale oil production in the U.S.

Melbourne-based BHP will pay Petrohawk $38.75 a share, the two companies said today in a statement. That’s 65 percent more than the Houston-based company’s closing price on July 14.

The acquisition gives BHP three assets across about one million net acres in Texas and Louisiana. BHP agreed to pay $4.75 billion in cash in February for Chesapeake Energy Corp.’s Arkansas shale gas assets to tap growth in the U.S. gas market, the world’s biggest.

“Petrohawk has a focused portfolio of three world class onshore natural gas and liquids rich shale assets,” BHP Petroleum Chief Executive J. Michael Yeager said in the statement.

Petrohawk fell 1.8 percent to close yesterday at $23.49 at in New York. BHP fell 0.1 percent to A$43.60 at the 4:10 p.m. close of Sydney trading yesterday.

The purchase would be the largest acquisition of a U.S. exploration and production company since Exxon Mobil Corp. bought XTO Energy Inc. for $34.9 billion in 2009, according to Bloomberg data.

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Permalink Reply by mskillerbee on July 18, 2011 at 16:36

Shale Wizard,

Thank you for the insight.  If someone gets to retire early out of this that would be fantastic; I am always thrilled when someone gets that kind of option. I didn't know that the employees were also stockholders which must be a bit exciting in a business with this much development and changes going on, good to know your jobs will be secure through this and i hope they will continue that way.

Guess I will just sit and wait to see if I get a response to my letter about what is up with the 8 months wait since production started.  I am getting better at waiting as I get older.....MOST of the time.

Thanks again!

Permalink Reply by IRielley on July 17, 2011 at 13:34
I agree with you Aubrey. When you read the press in BHP's backyard (Australia and South Africa), BHP has been pushing very hard to find acquisition candidates that will allow it to pump up its production output. The deal is being presented to shareholders as a fast method of achieving a 10% or greater year over year production growth. And they're budgeting many billions of dollars to make it happen.

I see this as good and bad news for those of us in north La. It is good news in the sense that we will probably soon see full section development in the core of the play, which means more jobs and economic growth. But, of course, the gas will be coming out of the ground at a less than desirable price, and that's the downside.
Permalink Reply by adubu on July 17, 2011 at 13:37
they can not get it out that fast IMO you will see NG prices >$7 in next 5 years or less
Permalink Reply by Cayman Bum on August 4, 2011 at 15:43
I will help her out. Petrohawk has charged royalty owners severance taxes on wells during payout some as much as nearly $1.5 million for 1 Haynesville shale well. They have not piad royalties to numerous royalty owners 2 of which I know they owe another $1mill to.  That is only 2 people and 1 well. How many other liabilities out there has BHP acquired that they do not even know about? How many people have received sev tax reimbursements for their wells during payout? And now we hear they were cash poor when they were receiving free capital from the royalty owners they were supposed to be paying!  E-N-R-O-N!
Permalink Reply by BirdDawg, plain ole' idiot on July 17, 2011 at 7:56

Beverly,

Yes mam, I can. And everybody else on here can spell it also. Actually,, it is a pretty simple word to spell.

I fail to see any connection between BHP and ENRON, or any similarities. I have seen you post this at least three times, so maybe now you will cease to take up space with that.

Permalink Reply by William C. Morrison on July 17, 2011 at 8:07
I agree there is not a similarity with Enron.  Enron was operated by a bunch of crooks, not so at Petrohawk.  It is just that BHP Billington has a short attention span, looking for results immediately, if non, tend to jettison their purchases.  Later when things change, they regret it but . . .
Permalink Reply by Cayman Bum on August 4, 2011 at 16:13
BirdDawg, I am not saying BHP is bad. Their strong financial position is a blessing to Petrohawk. My question is how in the world did Petrohawk end up in dire financial straights with no capital or cash? I just hope BHP is aware of all the outstanding liabilities so they can continue with their positive plans that will benefit the oil and gas industry. I can't imagine where Petrohawk would have ended up without the BHP takeover...just look at what their stock price was before the takeover was announced. Clearly they don't owe anyone you know money. Ir you were an unpaid royalty owner you would be singing a different tune.
Permalink Reply by BirdDawg, plain ole' idiot on August 4, 2011 at 16:30

Cayman,

I guess I am missing something here. All I can find that I posted prior to your post was to the lady about the ENRON reference.

Permalink Reply by BeverlyRevelry on July 15, 2011 at 16:35
Can you spell E-N-R-O-N ?
Permalink Reply by Joe Aldridge on July 17, 2011 at 8:48
I think a lot of people are missing the REAL motive for buying these independents up. I think the knowledge and experience that has been developed by these companies is the true incentive behind buying them. The technology that has been developed by them is almost unbelievable and all of this has taken place in the past 5 years. This technology and experience  is useful WORLD WIDE and companies like Exxon and BHP have the ability to take it there.  These Independents as such don't.
Permalink Reply by william g morrison jr on July 17, 2011 at 9:34
Also it seems to me many of the "analysts" writing about this deal are focusing too much on natural gas and it's abundance and not giving enough to the value of the light oil and liquids involved.
Permalink Reply by jffree1 on July 18, 2011 at 7:43

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