UK: Total gets $905M from North Sea sale
- Business & Finance
French oil company Total will sell all of its interests in the FUKA and SIRGE gas pipelines and the St. Fergus Gas Terminal to North Sea Midstream Partners for £585 million (around $905 million), subject to the customary approvals.
“The sale of these midstream transportation assets is another example of Total’s strategy of active portfolio management and the strong potential to unlock value from a range of infrastructure assets,” said Patrick de La Chevardière, Chief Financial Officer at Total. “Transferring ownership to an entity specializing in midstream UK assets creates value for us and ensures a long and bright future for the facilities.”
The Frigg UK Pipeline (FUKA) is a 362-kilometer, 32” gas pipeline that was originally constructed in 1977 to connect the Frigg Field on the UK – Norway median line to the St. Fergus Gas Terminal in Scotland. The Frigg Field is now decommissioned but the FUKA pipeline is still operational, delivering gas from some 20 fields in the Northern North Sea to the terminal at St. Fergus. Total holds a 100% operated interest in the FUKA pipeline.
The St. Fergus Gas Terminal is a three-train processing plant with a capacity of 2,648 million cubic feet of gas per day (Mmscf/d), currently serving over 20 fields. Total holds a 100% operated interest in the terminal.
The Shetland Island Regional Gas Export System (SIRGE) is a 234-kilometer, 30” gas pipeline with a capacity of 665 Mmscf/d connecting the Shetland Gas Plant to the FUKA pipeline. Total holds a 67% operated interest in the SIRGE pipeline alongside Dong E&P (UK) Limited (18.3%), Chevron North Sea Limited (7.2%) and OMV (UK) Limited (7.5%).
Following the completion of the sale, North Sea Midstream Partners will have an agreement with px Group for the operation and maintenance of the assets.
In the UK, Total’s equity production was 89,000 barrels of oil equivalent per day in 2014. More than 90% of Total’s production in the UK comes from several operated fields located offshore in two major zones: the Alwyn/Dunbar area in the Northern North Sea and the Elgin/Franklin area in the Central Graben, where the West Franklin Phase 2 project was brought on stream earlier this year.
Also, the company’s coming start-up of the Laggan-Tormore project in the West of Shetland area, Total is opening up its third hub in the UK, and, as Total put it, a new frontier gas production area for the industry.