Total Closes the Maersk Oil Acquisition and Becomes the Second-Largest Operator in the North Sea
Monday 12 March 2018
Total announced the closing of the Maersk Oil acquisition signed on 21st of August 2017. It brings to Total around 1 billion barrels of oil equivalent of 2P/2C reserves and resources, mainly in the OECD countries, and a production of about 160,000 barrels of oil equivalent per day (boe/d) in 2018, ramping up to more than 200,000 boe/d by the early 2020s.
The acquisition of Maersk Oil allows the Group to reinforce its existing leading positions in the U.K. and in Norway, as well as to enter Denmark, making Total the second-largest operator in the North Sea with an output of 500,000 boe/d by 2020.
The transaction also strengthens other growth areas of Total, in particular in Algeria and in the Gulf of Mexico in the United States. It is immediately accretive to both cashflow per share and earnings per share.
The effective date of the transaction is the 8th of March 2018. Under the agreed terms, A.P. Moller-Maersk will receive a consideration of $4.95 billion in Total shares (around 97.5 million shares based on average share price of the 20 business days prior the signing date of the 21st of August 2017) and Total will assume $2.5 billion of Maersk Oil’s debt.
Key assets of Maersk Oil
North Sea
8.44 % of the giant Johan Sverdrup oil field, Norway
- start-up planned in 2019
- Phase 1: production capacity of 440,000 boe/d
- Phase 2: expansion to 660,000 boe/d
49.99 % of the Culzean gas field, U.K.
- start-up planned in 2019
- production capacity of 100,000 boe/d
31.2 % of the Tyra producing gas field, Denmark
- start-up of redevelopment phase planned after 2020
- redevelopment enabling a production capacity of 55,000 boe/d
United States
25% of the Jack producing oil field
- production capacity of 50,000 boe/d
Algeria
12.25% of the El-Merk, Hassi Berkine producing oil fields
- production capacity of 400,000 boe/d