Completion of the proposed merger of BHP’s oil and gas portfolio with Woodside Petroleum Ltd is targeted for 1 June 2022, subject to the satisfaction of conditions precedent including approval by Woodside shareholders at the Woodside general meeting on 19 May 2022. The effective date of the merger is 1 July 2021. The half year financial results for 31 December 2021 were prepared on the basis that BHP Petroleum is a discontinued operation.

Total petroleum production increased by two per cent to 77 MMboe. No further production guidance for the 2022 financial year will be provided for Petroleum given the business is presented as a discontinued operation.

Crude oil, condensate and natural gas liquids production increased by eight per cent to 37 MMboe, reflecting the additional 28 percent working interest acquired in Shenzi in November 2020, new production from Atlantis and Shenzi, increased volumes from Ruby following first production in May 2021, and lower impact from weather events in the Gulf of Mexico. The increase was partially offset by natural field decline across the portfolio.

Natural gas production decreased by three per cent to 244 bcf, reflecting natural field decline, decreased production at North West Shelf and unplanned downtime at Angostura. The decline in production has been partially offset by increased volumes from Ruby and higher seasonal demand for gas at Bass Strait.

In the central Gulf of Mexico, the Wasabi-2 well encountered sub-commercial hydrocarbons and was plugged and abandoned. This completes the Wasabi exploration program, with results under evaluation to determine next steps.

On 2 March, 2022, BHP signed a farm-out agreement with a subsidiary of Shell plc. to assign 40 per cent equity in each of the two Barbados offshore Exploration Licences – the Bimshire and Carlisle Bay Blocks. The agreement is subject to customary regulatory approvals and third-party consents. Completion of the deal is expected by the end of the June 2022 quarter.

Petroleum exploration expenditure for nine months ended March 2022 was US$362 million, of which US$261 million was expensed. An approximately US$540 million exploration and appraisal program is being executed for the 2022 financial year.