BHP to acquire Hess' stake in Shenzi oil field for $505 million

(Reuters) - BHP Group Ltd <BHP.AX> <BHP.L> said on Tuesday it had signed an agreement to acquire Hess Corp's <HES.N> entire stake in Shenzi oil and gas field in the Gulf of Mexico for $505 million.

BHP said the deal would take its ownership in the oil platform to 72%, with Spain's Repsol SA <REP.MC> owning the rest.

With the acquisition, BHP said it would be able to add about 11,000 barrels of oil equivalent per day of production to its portfolio and also grow high-margin barrels.

"This transaction aligns with our plans to enhance our petroleum portfolio by targeted acquisitions in high quality producing deepwater assets," said Geraldine Slattery, BHP's president of petroleum operations.

The Anglo-Australian company in August put up 50% of its stake in the Bass Strait oil and gas venture owned with Exxon Mobil Corp <XOM.N> for sale as revenue contribution from the operation dwindled in fiscal 2020 compared to a year ago.

Despite a plunge in crude prices this year, BHP remains bullish on oil as it has profitable prospects for at least the next decade.

In a separate statement, Hess said it was selling its 28% interest in Shenzi to "preserve cash and preserve the long term value of our assets in the current low oil price environment."

(Reporting by Anushka Trivedi in Bengaluru; Editing by Shinjini Ganguli)