REPLACING BASS STRAIT—BHP PETROLEUM'S GLOBAL QUEST, 1970 TO 1994

Abstract

Twenty five years ago, after Bass Strait production had commenced in 1969, BHP Petroleum (BHP) began its global quest for a new Bass Strait. The first stepouts were close to home and opportunistic and the company preferred the role of non-operator, not having the necessary offshore operating expertise at that time. BHP had been driven overseas in its search by the punitive tax regime and limited prospectivity for another Bass Strait at home.

The first significant milestone was 1981, after the North West Shelf project go-ahead, with the company desiring to operate and expand overseas. With the discovery of petroleum in the Timor Sea, BHP had developed innovative engineering capabilities which were later enhanced through the acquisition of Hamilton Oil (1991). Acquisitions were considered important for the company's growth from the early 1980s onward and were highlighted in BHPP's first major strategic review in 1985 together with the need to undertake global basin studies.

As the 1980s progressed, there was a rapid expansion of staff due largely to acquisitions. BHP consolidated its US position with two acquisitions, then entered the downstream oil sector via the PRI (Hawaii) acquisition in 1989. The Hamilton acquisition helped to enhance the company's global reputation as a low cost, fast track offshore developer, a capability which helped capture the Dai Hung oilfield development opportunity, offshore Vietnam.

A major strategic review in 1992 identified opportunities in downstream gas and power and multiple entry points to the energy value chain are now being targeted. In addition, a more focussed approach to exploration is being employed.