Total agrees £6bn deal to buy Maersk Oil
French supermajor Total has become the second largest North Sea operator at a stroke with a surprise multi-billion dollar swoop on Danish oil and gas firm Maersk Oil. The $7.45bn (£5.79bn) deal is the largest North Sea takeover in a decade and is even more of a rarity at a time when other oil majors are quietly retreating from UK waters. The move will hand Total a stake in the one of the basin's largest oil discoveries ever made. In addition to the Johan Sverdrup field it will include the Culzean gas project, which will be capable of providing 5pc of UK gas demand by the end of the decade. Patrick Pouyanne, Total's chief executive and chairman, described the takeover as an “exceptional opportunity” for Total to snap up high quality assets that fit with the group's core regions. “The combination of Maersk Oil's North Western Europe businesses with our existing portfolio will position Total as the second operator in the North Sea with strong production profiles in the UK, Norway and Denmark, thus increasing exposure to conventional assets in OECD countries,” he added. Mr Pouyanne told its investors the deal would unlock savings of $400m a year in overlapping activities with an immediate production boost of low-cost oil to take the company over the 3 billion barrel of oil a day threshold. Maersk's oil portfolio is profitable at prices of $30 a barrel, meaning investors can expect profitable oil flows even if the market continues to hover at around $50 a barrel in the years ahead. None the less the plans met with a muted response from shareholders who may need to be patient to reap the full benefit of the deal. Maersk is focusing on transport and logistics Total will hand Maersk $4.95bn in Total shares, and assume ...Read the rest of this story
