BHP Billiton's petroleum arm is expecting double digit volume growth for the next four or five years following flat production volumes over the last two fiscal years, the company said today.
BHP Billiton's petroleum arm is expecting double digit volume growth for the next four or five years following flat production volumes over the last two fiscal years, the company said today.
Speaking to journalists at a media conference at the Australian Petroleum Production and Exploration Association (APPEA) conference in Perth, chief executive Michael Yeager said overall the company feels pretty good about the future.
"We're speaking about 10 per cent volume growth year-on-year for the next four or five year ... that's from a base of 320,000 barrels per day from the two previous fiscal years," Mr Yeager said.
The confidence in future growth stems from a variety of projects in various stages of development, Mr Yeager said, including the recent start up of the Stybarrow project, which produces 80,000 barrels a day, and the expansion of train five of the North West Shelf project.
Meanwhile the finalisation of remediation plans for the delayed Neptune oil and gas project in the Gulf of Mexico should see that project coming online in the second quarter with Mr Yeager stressing the company has the technical know-how to do it.
Additionally Mr Yeager said that in relation to the proposed BHP merger with rival Rio Tinto, BHP's petroleum division - which currently contributes some 20-25 per cent of earnings to the overall group - will seriously consider any acquisitions opportunities.
"The petroleum arm of BHP Billiton will still be a part of the [overall] company and will have tremendous expandability, it will not be subject to the type of anti-trust related activities and we will certainly be looking for the opportunities to take advantage of that," he said.
"Right now we have analysis in that area [acquisitions] that we're proud of."
Last year there was speculation that BHP's petroleum division could be sacrificed to finance the merger proposal with Rio, however Mr Yeager today confirmed the division's importance to the overall group and its relation to the mining sector, which Rio had previously said was no good fit for a mining business.
"We haven't spent one minute talking about petroleum doing anything but being a core part of this and being bigger," he said.
Meanwhile, Mr Yeager said liquefied natural gas projects in Western Australia were becoming increasingly viable.
"All of these projects are getting legs - the same is true for Scarborough.
"There has been a huge change in the LNG supply/demand fundamentals."
He said BHP Billiton was considering which company it would partner with at the Scarborough project offshore WA.
"Five years ago, you couldn't have given it away."
He said BHP Billiton had its technical project team working on its Macedon gas project off WA for the first time, drilling a second well.
He said Macedon has a much smaller resource to Scarborough "and doesn't have the same oomph to be part of an LNG project".
BHP Billiton continued to consider building a new LNG facility at Onslow, he added.
Mr Yeager also said the mining giant's plans worked to an oil price substantially lower than the current oil price of about $US106 per barrel.
