Australian oil and gas company, BHP, has signed a Membership Interest Purchase and Sale Agreement with Hess Corporation to acquire an additional 28% working interest in Shenzi, a six-lease development in the deepwater Gulf of Mexico, according to a press release.

The agreed purchase price between the two companies reached $505 million, meaning BHP’s working interest would become 72%. This is expected to add approximately 11,000 barrels of oil equivalent per day (boe/d) of production.

BHP President Petroleum Operations, Geraldine Slattery said: “This transaction aligns with our plans to enhance our petroleum portfolio by targeted acquisitions in high quality producing deepwater assets and the continued de-risking of our growth options. We are purchasing the stake in Shenzi at an attractive price, it’s a tier-one asset with optionality, and key to BHP’s Gulf of Mexico heartland.”

This transaction is consistent with the company’s strategy of targeting counter-cyclical acquisitions in high-quality producing or near producing assets. 

Shenzi is structured as a joint ownership: BHP (Operator, 44% interest); Hess (28% interest), and Repsol S.A. (28% interest).