BPT Beach Energy Limited

   By Ross Kelly 
 

SYDNEY--Chevron Corp. (CVX) said it will buy Australian shale gas assets from Beach Energy Ltd. (BPT.AU) for up to US$349 million, placing a bold bet on the potential to replicate the U.S. boom in unconventional gas output in the Outback.

Chevron, the second-biggest U.S. oil company behind ExxonMobil Corp. (XOM), said it has agreed to buy up to 60% of two blocks in central Australia's Cooper Basin covering an estimated 810,000 acres.

In a separate statement, Beach said Chevron will make an upfront cash payment and agree to fund its share of development costs to acquire 30% of the Australian company's stakes in the two permits. Chevron has also agreed an option to lift its holding up to 60% at a later date, depending on exploration results.

Write to Ross Kelly at ross.kelly@wsj.com

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