Total Secures Final Approval for Maersk
The Danish Energy Agency, a government regulator, announced March 2 that it had approved Total’s $7.45bn takeover of Maersk Oil.
When it announced the planned Maersk takeover in August 2017, Total said it expected it to close in 1Q 2018. At 4Q results last month, Total CEO Patrick Pouyanne said the Danish approval was the last regulatory approval required.
The agency said it approved the deal on February 28, adding that its approval is based on an examination of the buyer's financial strength, technical ability, and ability to drive and develop the energy business.
The approval includes conditions, among which are that financial obligations contained in various licences (including the Tyra area and gas pipelines) are supported by a parent company guarantee from Total. There are also stipulations that the agency be informed of any future changes in the co-operation agreement governing the DUC joint venture between Total, Anglo-Dutch Shell, US major Chevron and state Nordsofonden.
DUC operates several fields, including the key Tyra offshore gas hub that handles 90% of Denmark’s offshore gas production – redevelopment of which could last from late 2019 until mid-2022. DUC agreed a krone 21bn ($3.4bn) redevelopment of the Tyra gas field in December 2017.
In addition, Danish shipping and logistics group AP Moller – Mærsk, the seller of Maersk Oil, is liable to remove existing facilities if it subsequently appears that Total is unable to cover the costs.
At the same time, the Danish government has called on Total to enter into a dialogue with the Danish Energy Agency on the modernisation of its licence terms to exceed general conditions for Danish North Sea licences, as far as possible.
Gas production and processing at the Tyra gas field in the Danish North Sea will cease from November 2019 until July 2022 as its platform is rebuilt, which will require Denmark to significantly step up gas imports from Germany during that period. (The banner photo above shows the Tyra East platform, courtesy of Maersk Oil)