Yemisi Izuora
French integrated multinational oil and gas company, Total said it has completed the acquisition of Danish Maersk Oil in a deal that was signed in August 2017.
The company said in a statement the effective date of the transaction is March 8, 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, and Total will assume $2.5 billion of Maersk Oil’s debt.
“This major acquisition is a success on many levels,” said Patrick Pouyanne, Chairman and Chief Executive Officer of Total. “First, it illustrates our strategy to build on our strengths and grow our presence in Total’s core areas, like the North Sea, to strengthen our leadership there. Second, it brings high-quality and low-breakeven assets, enhancing our worldwide portfolio. Third, the strong overlap between Maersk Oil and the Group’s assets will generate more than $400 million of synergies per year.”
According to the company, the acquisition will give Total an access to around 1 billion barrels of oil equivalent of 2P/2C reserves and resources, mainly in the Organisation for Economic Co-operation and Development, OECD, countries, and production of about 160,000 barrels of oil equivalent per day (boepd) in 2018, which will be ramped up to more than 200,000 boepd by early 2020s.
“We are committed to preserve and further develop Maersk Oil’s heritage by relying on the strong competencies of its teams. Our regional hub for North Sea activities is now headquartered in Copenhagen. Moreover, we welcome a major new shareholder A.P. Moller-Maersk which will hold 3.70 per cent of the Group’s capital,” Pouyanne added.
The company said the acquisition of Maersk Oil will allows the group to reinforce its existing leading positions in the United Kingdom, Norway, as well as to enter Denmark, making Total the second-largest operator in the North Sea with an output of 500,000 boepd by 2020.