Total has concluded its previously announced acquisition of Engie’s portfolio of upstream liquefied natural gas (LNG) assets in a $1.5bn deal.
The company is expected to make additional payments of up to $550m in the event of an improvement in the oil markets in the coming years.
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The portfolio includes participating interests in liquefaction plants, notably the interest in the Cameron LNG project in the US, long-term LNG sales and purchase agreements.
Total will also acquire LNG tanker fleet and obtain access to regasification capacities in Europe.
Total chairman and CEO Patrick Pouyanné said: “Acquiring Engie’s LNG business is a real step change for Total, allowing us to leverage size and flexibility in the fast-growing and increasingly commoditised LNG market.
“This transaction makes Total the second largest global LNG player among the majors with a worldwide market share of 10% and the group will manage an overall LNG portfolio of around 40Mt per year by 2020.
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By GlobalData“It also helps us to build a position in the US LNG market, with the 16.6% stake in the Cameron LNG project.”
Upon acquisition, Total takes over Engie’s teams in charge of the upstream LNG activities, which represents around 180 employees.
The completion of the deal follows the signing of an agreement by Total last November to acquire Engie’s portfolio of upstream LNG assets.
By 2020, Total will have a total volume of LNG managed of 40Mt/y, a liquefaction capacity portfolio of 23Mt/y, distributed among the Middle East, Australia, Russia and the US.
The company will also have a fleet of 18 LNG carriers, of which two will be floating storage and regasification units (FSRUs).
