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Total signed a deal with Maersk Oil for $ 7.5 billion



Total buys oil and gas business Maersk in the transaction worth $ 7.45 billion.



21.Aug.17 4:14 PM
By Daria Zaytseva
Photo Toinnov.com

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Total signed a deal with Maersk Oil for $ 7.5 billion

According to the French company, this transaction will strengthen its activities in the North Sea and until 2019 will increase its production to 3 million barrels per day, and will increase profit and cash flow.

For the Danish company A.P. Moller Maersk sale of Maersk Oil with reserves of approximately 1 billion barrels of oil, corresponds to the strategy of focusing on its shipping business and other activities announced last year.


Total was betting on new, rather than mature, fields in the North Sea, and the acquisition gives it further economies of scale, making it the second largest player in the region with a production of about 500,000 barrels of oil equivalent per day.


The purchase also signals that some oil companies are ready to invest in order to replenish stocks and increase production, waiting for the recovery of oil prices. Total CEO Patrick Pouyanne said the company offered a deal to Maersk as an alternative to a floating business.


Under the terms of the transaction, A.P. Moller Maersk will receive $ 4.95 billion in Total shares, and Total will take on $ 2.5 billion of Maersk Oil debt.


The Danish oil company has access to high-quality deposits in the Norwegian and British North Sea, which, according to Pouyanne, will help increase Total's output to 3 million barrels of oil equivalent by 2019, compared to 2.5 million barrels per day today.


A.P. Moller Maersk rose 2.8 percent to 14.50 GMT, while Total shares slightly changed.




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