Anglo-Australian mining company BHP Billiton is set to buy £2.9bn ($4.75bn) of shale gas assets from US firm Chesapeake Energy.

BHP will take a stake in the shale field in Fayetteville, Arkansas which currently produces more than 400mn cubic feet (11mn cubic meters) of natural gas per day.

BHP Billiton chief J. Michael Yeager said: “This transaction marks BHP Billiton’s entry into the US shale gas business. The operated position we are obtaining will immediately make BHP Billiton a major North American shale gas producer.”

Chesapeake’s Fayetteville shale reserves include around 487,000 acres of leasehold and natural gas- producing properties, the second largest position in one of the largest gas fields in the world.

The UK government is currently in the process of reviewing UK policy on the subject of shale gas use. Those in favour of it say that if it can be developed economically then it could make a useful contribution to the UK’s gas supply in terms of diversity and security of supply.