Total sells $2.5 b oil field stake to Sinopec
By Joseph BAMIDELE
French oil giant Total, said it had signed a deal to sell a 20 per cent stake of it offshore oil field, OML 138 block to China’s Sinopec for $2.5 billion which will help the French oil group to fund its oil exploration plans.
The Nigerian offshore oil field, OML 138 block currently produces 130,000 barrels per day of oil equivalent and contains the Usan field, which started production in February.
The French group said in September it planned to sell assets worth between $15 billion and $20 billion in the period up to 2014 as part of a bolder approach to managing its business, which has seen it buy and sell assets more frequently.
Total, which is also selling its French gas network business, is ramping up spending on exploration to take advantage of the historically high price of oil, which averaged $113.6 a barrel in the first half of 2012.
Total’s chief executive, Christophe de Margerie, said earlier this month that the group did not intend to disengage from Nigeria altogether.
“It doesn’t mean we are scared and intend to start some kind of walking out of Nigeria … Total is happy to develop its projects in Nigeria,” he told reporters at an energy conference in Abu Dhabi.
Chinese companies have been among the most aggressive in targeting assets around the globe to help feed oil and raw material demand in the world’s second-biggest economy.
Sinopec, Asia’s largest refiner, has also snapped up energy assets in Britain and the United States recently to boost foreign earnings, as a slowdown in China hit profits.
Other shareholders in the OML 138 oil block, located 100 kilometres off the coast of Nigeria, are Exxon and Chevron, with 30 percent each, as well as Nexen , which owns 20 percent.
Total’s shares were up 2.5 percent by 1500 GMT, outperforming a 2.1 percent rise in the European oil and gas sector
Nigeria is Africa’s largest crude oil exporter and oil companies operating there have long had to deal with attacks on their pipelines and staff, with the country’s worst floods in 50 years seriously affecting their output over recent weeks.