Exxon Mobil Corp.'s potential sale of its 50% stake in the aging Gippsland Basin oil and gas development in Australia's Bass Strait is expected to attract few buyers, according to Wood Mackenzie research director Angus Rodger.
He said the buyers have to adjust with the age of the assets, declining production and decommissioning liabilities. Rodger expects stronger interest from local companies and the new operator to boost production to delay decommissioning spending.
Exxon also tried to sell its 50% stake in the Gippsland oil assets in 2016.
The price of the oil and gas assets could reach $3 billion, Reuters reported Sept. 18, citing analysts and bankers, but the deal value is expected to be slashed due to decommissioning costs.
Possible buyers include Japan's Mitsui & Co. Ltd., Beach Energy Ltd. and Cooper Energy Ltd., as they hold assets in the Bass Strait. Analysts told Reuters the companies might also bid in a consortium due to the price.
The sale is part of Exxon's goal to sell $15 billion in assets through 2021.
BHP Group holds the other 50% stake of the development, which supplies around 40% of east coast Australian gas demand.
