SYDNEY — BHP said it is in talks with Australian oil-and-natural-gas company Woodside Petroleum Ltd. on a potential deal to combine BHP’s petroleum unit with Woodside.
BHP is also assessing other options for the division as part of a strategic review, the company said, without elaborating.
Analysts estimate the petroleum business has a value of at least $15 billion, and a deal is being explored while BHP separately hunts for a buyer for its thermal-coal mining business.
Selling the petroleum business would lead to BHP focusing on mined commodities, which include iron ore, metallurgical coal, copper, nickel and potentially potash if it proceeds with a large Canadian project. Of these commodities, iron ore accounts for the largest share of BHP’s profits.
BHP said a possible deal with Woodside would include a distribution of Woodside shares to BHP shareholders. "While discussions between the parties are currently progressing, no agreement has been reached on any such transaction," the mining company said.
Woodside, which has a market value of around $15.5 billion, separately confirmed that it was in talks with BHP. "Woodside continuously reviews the composition of its asset portfolio and opportunities to create and deliver value for shareholders," the company said.