BP buys big into Permian, U.S. shale with $10.5 billion deal

BHP Billiton is trimming the number of its U.S. drilling rigs, such as this one in the Eagle Ford Shale.

>>>In the years since oil prices collapsed, American drillers have reshaped the nation’s shale plays in hundreds of oil and gas deals worth a combined $208 billion. Here are the 30 largest transactions. less BHP Billiton is trimming the number of its U.S. drilling rigs, such as this one in the Eagle Ford Shale.

>>>In the years since oil prices collapsed, American drillers have reshaped the nation’s ... more Photo: BHP Billiton Photo: BHP Billiton Image 1 of / 47 Caption Close BP buys big into Permian, U.S. shale with $10.5 billion deal 1 / 47 Back to Gallery

British energy major BP is a huge Texas player now after agreeing to pay $10.5 billion for the shale assets of Australia's BHP Billiton.

The sale represents a major turnaround for BP as it seeks to grow again after the 2010 Deepwater Horizon tragedy in the Gulf of Mexico. The deal includes all of BHP's acreage in West Texas' booming Permian Basin, South Texas' Eagle Ford shale and Louisiana's Haynesville shale.

BP Chief Executive Bob Dudley said the deal is a transformative acquisition that gives BP a major presence in the onshore U.S., and not just the deepwater Gulf.

BP has largely shrunk this decade since the 2010 Gulf rig explosion, which killed 11 workers, spilled nearly 4 million barrels of oil, and cost the company billions of dollars to settle claims.

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On the other hand, BHP bought big into U.S. shale in 2011 with its acquisition of the Houston oil and gas company Petrohawk Energy for about $15 billion, including debt, and acreage from Oklahoma City's Chesapeake Energy for $5 billion.

But the Australian mining company took a big hit during the recent oil bust, writing down the value of its shale assets by $7 billion two years ago. It now considers the shale game too risky when weighed against its traditional mining holdings.

BHP announced its plans to sell the assets last year and BP proved the top bidder.