BP to buy US shale assets from mining giant for €8bn

BP has struck its biggest deal in nearly two decades by agreeing to buy US shale oil and gas assets from mining giant BHP for $10.5bn (?8bn).
The move by the British oil company comes as it continues to pay $65bn in damages for the Deepwater Horizon disaster in the Gulf of Mexico in 2010.
With the deal, BP will get access on the energy-rich region of the Permian basins in Texas, which is currently producing 3.5 million barrels a day - about a third of Saudi Arabia's output.The sale also provides an exit for Anglo-Australian miner BHP, which spent $20bn buying the assets in 2011.The investment turned sour after prices collapsed, hammering profits.
BP to buy US shale assets from mining giant for €8bn

BHP had been under pressure from investors to sell the businesses
BHP had been under pressure from investors, including US hedge fund Elliott Management, to sell the assets.Despite the shale operations proving to be a poor investment for BHP, BP chief executive Bob Dudley called the businesses "world class" with rising oil prices boosting their prospects.
He said in a statement: "This is a transformational acquisition... a major step in delivering our upstream strategy and a world-class addition to BP's distinctive portfolio."Given our confidence in BP's future - further bolstered by additional earnings and cash flow from this deal - we are increasing the dividend, reflecting our long-standing commitment to growing distributions to shareholders."It also announced plans to buy back up to $6bn of its own shares, as it sells off some businesses.BP beat rivals Royal Dutch Shell and Cheveron for the assets, which analysts thought would be valued at up to $10bn.
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BHP chief executive Andrew Mackenzie: "We are pleased that we have agreed to sell all of our shale assets in two simple transactions that provide certainty for shareholders and our employees.""The sale of our onshore US assets is consistent with our long-term plan to continue to simplify and strengthen our portfolio to generate shareholder value and returns for decades to come."
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