Total completes $1.5 bln Engie’s upstream LNG assets buy

Total said on Friday it has closed the acquisition of Engie’s portfolio of upstream liquefied natural gas (LNG) assets for an overall value of $1.5 billion.

Additional payments of up to $ 550 million could be payable by Total in case of an improvement in the oil markets in the coming years.

This 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, an LNG tanker fleet as well as access to regasification capacities in Europe.

“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 commoditized LNG market. This transaction makes Total the second largest global LNG player among the majors with a worldwide market share of 10 percent and the group will manage an overall LNG portfolio of around 40 mt per year by 2020,” said Patrick Pouyanné, chairman and CEO of Total.

He added the acquisition also grants the company a position in the US LNG market, with the 16.6 percent stake in the Cameron LNG project.

Following the transaction, Total takes over the teams in charge of the upstream LNG activities at Engie.

By 2020, Total’s LNG portfolio will include a total volume of LNG managed of 40 mt/year and a liquefaction capacity portfolio of 23 mt/year. It will also include a worldwide LNG trading contracts portfolio of 28 mT/year and will make Total a key European market supplier with regasification capacities of 18 mt/year.

The portfolio will also include a fleet of 18 LNG carriers, of which 2 FSRUs.