Total acquires Maersk Oil in $7.45 billion deal

Total acquires Maersk Oil in $7.45 billion deal

10:28 AM, 21st August 2017
Total logo

PARIS, FRANCE: Total SA announced that it is acquiring 100 percent shares of Maersk Oil & Gas A/S (Maersk Oil), a wholly owned subsidiary of A P Moller – Maersk A/S, for $7.45 billion.

The transaction is expected to close in first quarter 2018.

Under the terms of the deal, A P Moller Maersk will get $4.95 billion in Total shares and Total will assume $2.5 billion of Maersk Oil's debt.

The combination with Maersk Oil offers Total an exceptional overlap of upstream businesses globally which will enhance Total’s competitiveness and value in many core areas, in particular through some high quality growing assets and through the delivery of synergies.

Key themes of transaction

Acquisition transforms Total’s North-West Europe outlook

  • This transaction will make Total the second-largest operator in the NW Europe offshore region which is the 7th largest oil and gas producing region globally.
  • Strengthens Total’s existing the North Sea offshore producing business in UK and Norway. The addition of Maersk Oil’s world class assets, including the operated UK gas field Culzean (49.99 percent working interest), close to the Elgin-Franklin hub operated by Total, and its stake in the giant Johan Sverdrup oil development (8.44 percent Working Interest) in Norway will bolster Total’s production profile in these countries.
  • Adds a new production hub with Maersk Oil’s operatorship and 31.2 percent ownership of the Danish Underground Consortium (DUC) producing assets in Denmark.
  • The pooling of Total’s and Maersk Oil’s technology and operating expertise will optimize the long-term value potential of the DUC assets to the benefit of Denmark and Total shareholders.  

Strengthening Total’s regional businesses:

The transaction also will strengthen other core Total regional businesses due to clear complimentary positions between Total and Maersk Oil including:

  • consolidating Total’s US Gulf of Mexico presence with the Maersk Oil interest in the Jack development in the Wilcox formation
  • becoming the second largest IOC in Algeria by production
  • complementing Total’s leading East Africa position via Maersk Oil’s Kenya assets
  • strengthening of Total’s Kazakh business via addition of operated production
  • benefiting of potential upsides in Angola and Brazil
  • pooling of Total and Maersk Oil geological and operational expertise in the Middle East - North Africa region.

“This transaction delivers an exceptional opportunity for Total to acquire, via an equity transaction, a company with high-quality assets which are an excellent fit with many of Total’s core regions. This transaction will deepen and accelerate this strategy significantly, as Total will become a 3rd one thousand barrels of oil equivalents per day major by 2019 to the benefit of all Total shareholders,” said Patrick Pouyanne, Chairman and CEO, Total.

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