On 2 March 2018, the Danish Energy Agency issued its approval of A.P. Moller-Maersk A/S’s sale of Maersk Oil & Gas A/S to Total. The Danish Energy Agency’s approval of the transfer contains conditions, including that A.P. Moller-Maersk, as seller, assumes a secondary liability for the decommissioning of existing Danish offshore facilities corresponding to Maersk Oil’s 31.2% interest in the Danish Underground Consortium, should Total be unable to cover such costs.
On 21 August 2017, A.P. Moller-Maersk A/S announced the sale of Maersk Oil & Gas A/S to Total for a total US$ 7.45 billion in shares and debt. Under the agreed terms, A.P. Moller-Maersk will receive a consideration of US$ 4.95 billion in Total shares and Total will assume US$ 2.5 billion of Maersk Oil’s debt. Total will issue to Moller-Maersk, 97.5 million Total shares (based on the average Total share price on the 20 business days prior to 21 August 2017) which represents 3.75% of the enlarged share capital of Total.
Total said Maersk Oil brings to Total the following:
• Proved plus probable reserves (2P) and resources (2C) of approximately 1 billion barrels of oil equivalent (boe), 85% of which are in OECD countries (more than 80% in the North Sea).
• The addition of 160,000 boe/d of mainly liquids production in 2018, acquired at an average price of US$ 46,000 per boe/d, offering high margins with an estimated free cash flow break-even of less than US$ 30/barrel and growing to more than 200,000 boe/d by the early 2020’s further strengthening Total’s leading production growth outlook.
• Total expects to generate operational, commercial and financial synergies of more than US$ 400 million per year, in particular by the combination of assets of Total and Maersk Oil in the North Sea, an area of excellence for both companies.
• The transaction is immediately accretive to both earnings and cash flow per share underpinning Total’s dividend profile.
Maersk Oil production comes from Denmark, UK, Norway, Kazakhstan, US Gulf of Mexico and Algeria. Exploration and development activities are on-going in Angola, Kenya, Brazil, Kurdistan in Iraq and in above producing countries. As at 31 December 2016, Maersk Oil proved plus probable reserves were reported to be 550 MMboe.
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