Subject: RT: BHP sale of Timor Sea oil fields to Paladin in doubt
Wednesday November 17, 3:34 PM
BHP sale of Timor Sea oil fields to Paladin in doubt
SYDNEY, Nov 17 (Reuters) - Australia's Woodside Petroleum Ltd. may execute pre-emptive rights to buy out partner BHP Billiton Ltd/Plc's stake in oil fields in the Timor Sea, blocking an acquisition by the U.K's Paladin Resources Plc.
BHP Billiton has already agreed to sell its 25 percent interest in the Corallina oil field and 33 percent interest in the Laminaria field to Paladin for $150 million, subject to Woodside and Royal Dutch/Shell . not exercising preemptive rights over the stake.
Asked on Wednesday whether Woodside, which operates both fields, would exercise its pre-emptive right to BHP's stake, Woodside Chief Executive Officer Don Voelte told Reuters: "We have rights, the right of first refusal, but there is no decision at this point."
Analysts have said Woodside might knock back the Paladin deal for strategic reasons.
Woodside operates the nearby Kuda Tasi and Jahal fields which it has been seeking to develop through a tie-in to the Northern Endeavour -- a floating production, storage and offloading facility connected to the ageing Laminaria and Corallina fields.
But the Kuda Tasi and Jahal joint venture could not agree on the tie-in.
Woodside has until mid-December to exercise its pre-emptive right.
BHP said it decided to sell the Corallina and Laminaria fields because they were non-core to its future petroleum strategy. It said the sale was expected to be completed early next year.
Woodside has a 50 percent stake in the Corallina field and a 45 percent interest in Laminaria. Shell is the only other stakeholder in both fields.
Woodside is 34 percent-owned by Shell.
The Laminaria and Corallina fields, discovered in 1994 and 1995 respectively, are naturally declining.
Last year, the fields produced a total 17.4 million barrels of oil compared with 31.7 million barrels in 2002. Production began in November 1999.
Woodside shares closed up 2.8 percent at A$19.09 in a firmer overall market.
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