BHP Billiton Ltd.’s recent announcement of a $2.8B charge for the diminished value of its dry gas Fayetteville Shale assets (see Shale Daily, Aug. 7) wasn’t the only bad shale-related news to come from the Australian company. Its Petrohawk Energy Corp. unit has been turning in sour numbers as well.
BHP bought Petrohawk Energy last year for $12.1 billion (see Shale Daily, July 18, 2011), but during the second quarter the unit was a loss-maker, posting a loss of US$46.4 million versus a profit of US$74.8 million during the year-ago quarter. For the first half of the year, Petrohawk lost nearly US$101.8 million compared with a profit of nearly US$42.9 million during the year-ago period.
During the second quarter and the first half of this year Petrohawk revenues from oil/natural gas as well as midstream operations were both up. However, marketing revenues during the second quarter were non existent, compared with nearly US$149.5 million during the year-ago quarter. For the first half of the year the company posted a marketing segment loss of US$67 million, compared with gains of more than US$290 million during the year-ago period.
Total operating revenues were US$487.1 million during the second quarter, down from US$597.4 million during the year-ago quarter.
Back when BHP bought Petrohawk, executives were enthusiastic about shales and dry gas in the United States.
“Petrohawk has a focused portfolio of three world-class onshore natural gas and liquids rich shale assets,” said BHP Billiton Petroleum CEO J. Michael Yeager. “With over a decade of significant investment and volume growth ahead, this transaction would build on our recent acquisition of the Fayetteville Shale in Arkansas and provides the potential to more than double our existing resource base.”
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