BP in no rush to make US shale acquisitions
"We will keep our eye open and see if there are things to add to it. But we are not in a hunt to make big acquisitions. They still look a little expensive to me," chief executive Bob Dudley said today.
BP has been running its onshore operations in the US lower 48 states as a standalone business for two years, in an attempt to speed up decision-making, cut costs, ensure better investment decisions and reduce the time it takes to bring resources on stream. There are signs the strategy is starting to pay off. BP's lower-48 production rose to 302,000 b/d of oil equivalent (boe/d) last year, from 284,000 boe/d in 2015, of which 84pc was natural gas. BP's production costs in the lower 48 declined to \\$7.44/boe from \\$8.73/boe in 2015, while capital expenditure fell to \\$812mn from \\$1.04bn.
Some of BP's peers — notably ExxonMobil and Chevron — have flagged up their US shale businesses as key growth areas over the next few years, led by their liquids-rich acreage in the prolific Permian basin. ExxonMobil recently agreed a deal worth up to \\$6.6bn for a package of US shale assets, including 250,000 acres in the Permian.
But BP is in no rush to emulate ExxonMobil's shale expansion.
"The lower 48 is a huge market with many small players. Some of the big companies have come in but nobody is dominant there. It is such a huge market that I would not rule out… that we would do something. But it is not a high priority focus that we need to go and do something in the lower 48," Dudley said. "We are not on the prowl".
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