Denmark: Oil Production Total Takes Over Maersk's Oil Business
Mærsk has signed an agreement to sell their complete oil business to Total for $ 7.45 billion in a combined share and debt transaction.
Copenhagen/Denmark — Total will take over Maersk Oil’s entire organisation, portfolio, obligations and rights with minimal pre-conditions, the Danish company announced. Planned development schedules and investments in strategic and sanctioned projects would be upheld.
The separation of the energy businesses was decided as part of last year’s strategic decision to focus Maersk’s future activities on transport and logistics, as well as a result of recent years’ oil and gas industry and market developments. Maersk Oil is the first of the four energy companies for which a future structural solution has now been identified. The solutions for Maersk Drilling, Maersk Supply Service and Maersk Tankers remain to be defined before the end of 2018.
The Danish company intends to separate out its oil and oil related activities to create an integrated transport & logistics company.
According to Total, Denmark will become the regional hub for all Total’s operations in Denmark, Norway and the Netherlands, based on Maersk Oil’s capabilities and strong position in the North Sea region.
Maersk has been the main operator in the Danish North Sea for half a century, establishing and maintaining Denmark’s position as self-sufficient within oil and gas. In addition, the business unit has significant presence in the British and Norwegian sectors, with nine licenses in Norway, including an 8.44 % ownership of Johan Sverdrup, one of Norway’s largest discoveries ever. In the United Kingdom, the company operates several offshore installations, as well as leading a number of project developments; most notably the Culzean gas development, where Maersk Oil is the operator and holds a 49.9 % ownership.
“Maersk Oil’s activities across the North Sea will become part of a leading global operator with a strong performance record and long-term growth interest in the sector. The combination of Total and Maersk Oil’s global footprint and geographical overlap will ensure the continued development of Maersk Oil’s worldwide strategic and selective assets,” says Claus V. Hemmingsen, Vice CEO of A.P. Moller - Maersk and CEO of the Energy division.
Denmark to Become Hub of Total's North Sea Business
Patrick Pouyanné, Chairman and CEO of Total, commented: "We will intensify and accelerate the push to optimise and extend the Danish oil and gas production. The addition of Maersk Oil’s strong capabilities and high quality assets to our business will create a leading international operator in the North West European offshore region, making Denmark a regional anchor point for Total’s North Sea business.”
This transaction will make Total the second largest operator in the North-West Europe offshore region which is the seventh largest oil and gas producing region globally. Post completion, Total will operate over 500 kboe/d (gross) production in this region.