The Broken Hill Proprietary Company Limited (BHP) today announced the sale of its oil and gas interests in Papua New Guinea to Orogen Minerals Ltd for US$130 million (A$200million), with a further US$10 to15 million to be received in the event of future development of the gas resources. The Company expects to record an abnormal profit of approximately A$70 million as a result of this transaction.

The sale marks a total withdrawal by BHP from its oil and gas assets in Papua New Guinea and includes BHP's interests in the Kutubu (PDL-2), Gobe (PDL-4) and Moran (PDL -2) oil producing fields and other holdings in pipeline licences PL-2 and PL-3, retention leases APRL - 2 and APRL -3 (under applications) and exploration licence PPL-161.

The transaction forms part of the BHP's portfolio management activities designed to generate value through the active management of the Company's assets. It also marks a further stage in BHP Petroleum's efforts to concentrate its activities around focussed niche strategies.

President BHP Petroleum Philip Aiken said: "The Papua New Guinea oil and gas properties represent high quality assets. However, in the context of our broader strategic priorities, and given the Company's relatively low equity position, it was appropriate to extract greater value from these assets through divestment."