Total acquires Engie’s upstream LNG business in $1.49 billion

Total acquires Engie’s upstream LNG business for $1.49 billion

5:28 AM, 9th November 2017
Total logo

PARIS, FRANCE: Total SA has signed an agreement with Engie to acquire its portfolio of upstream liquefied natural gas (LNG) assets for an overall enterprise value of $1.49 billion.

This portfolio includes participating interests in liquefaction plants, notably the interest in the Cameron LNG project in US, long-term LNG sales and purchase agreements, an LNG tanker fleet as well as access to regasification capacities in Europe.

The transaction is expected to close by mid-2018.

Following the transaction, Total will take over the teams in charge of the LNG activities at Engie, which represents around 180 employees.

In addition, in parallel with this transaction, Total and Engie agreed to cooperate to promote the use of biogas and renewable hydrogen, with Engie becoming Total's priority supplier in this field.

This deal will bring to Total:

  • 2.5 metric tonnes per annum (mtpa) of liquefaction capacity to reinforce Total's existing portfolio, bringing it to 23 mtpa by 2020, with:
  1. 16.6 percent equity stake in the Cameron LNG liquefaction plant with 3 trains currently under construction in Louisiana and the potential to expand by adding two further trains.
  2. 5 percent equity stake in the first train of the Idku LNG project in Egypt.
  • A portfolio of long-term LNG purchase and sale contracts, enabling the group in increasing its overall portfolio to 28 mtpa by 2020, with a diversified supply from Algeria, Nigeria, Norway, Russia, Qatar and US, and outlets balanced between Europe and Asia.
  • The access to regasification capacities of 14 mtpa in Europe, which, combined with the existing 4 mtpa of Total, allows the group to balance its consolidated purchase and sales portfolio.
  • A fleet of 10 LNG tankers which will be consolidated with the 3 LNG carriers of Total.

Overall, combining its interests in liquefaction plants and its portfolio of third-party supply contracts, the group will manage a global volume of nearly 40 mtpa.

“The combination of these two complementary portfolios will allow the group to manage an overall volume of around 40 million tonnes of LNG per year by 2020, making Total the second largest global player among the majors with a worldwide market share of 10 percent. With the equity stake in the Cameron LNG project, Total will also become an integrated player in the US LNG market, where the Group is already a gas producer,” said Patrick Pouyanne, chairman & CEO of Total.

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