REPYF - BHP clears $800M capex for oil projects in U.S. Mexico

BHP (BHP -2%) says it approved $544M in capital spending to execute the Shenzi North oil project in the U.S. Gulf of Mexico, and $258M in capital spending to move the Gulf of Mexico's Trion oil project into the front end engineering design phase. The company says the Shenzi North project offers returns at a nominal internal rate of return exceeding 35%, a breakeven of ~$25/bbl and a payback of less than two years. BHP owns a 72% interest in Shenzi North, while Repsol (OTCQX:REPYF, OTCQX:REPYY) holds the remaining 28%; BHP is operator and 60% owner of the deepwater blocks containing the Trion discovery, with Pemex holding the other 40%. BHP and other global miners trade lower today as iron ore prices fall to their lowest levels since April.

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BHP clears $800M capex for oil projects in U.S., Mexico