The North Sea region is among the largest oil and gas producing zones in the world. It will issue 97.5 million Total shares to A.P. Moller - Maersk, equal to a 3.75 per cent stake in the company.
Brent crude, the worldwide oil price benchmark that sets prices in the North Sea region, was down 1.1 per cent to $52.13 a barrel, as traders took profits following a rally at the end of last week. Total will also get Maersk's 8.44% stake in the giant Johan Sverdrup oil development offshore Norway and become the second largest independent in Algeria through Maersk's oil interests there. Though the number of European deals so far this year stands at roughly half the level of those completed in 2016, their value has reached $16.8 billion, compared with $5.3 billion in all of 2016, according to Wood Mackenzie. Altogether, the Maersk Group has received shares for Dollars 4.95 billion in the French oil company, corresponding to a 3.76 percent ownership share.
Total will gain 160,000 boe/d in production, mainly liquids, production in 2018, rising to more than 200,000 boe/d by the early 2020s. "This deal demonstrates Total's purchasing power and free cash flow", said Mr Brenac.
Alongside Maersk Oil's UK North Sea assets, Total will also take over its Danish and Norwegian operations. "We intend to build on the strong operational and technical competencies of the Maersk Oil teams in the same way we managed to do it in Belgium with the teams of Petrofina in the refining & chemical businesses".
Total is also taking over short-term debt valued at Dollars 2.5 billion and closure obligations worth USD 2.9 billion. The cost savings will be seen "in particular by the combination of assets of Total and Maersk Oil in North Sea".
The deal may yet be the Maersk's biggest single transaction yet in the first steps to break itself up. Cost synergies should add value, with the North Sea a key area of overlap.
Commenting on the transaction, Patrick Pouyanne, Chairman and CEO said, This transaction delivers an exceptional opportunity for Total to acquire, via an equity transaction, a company with high quality assets which are an excellent fit with many of Totals core regions.
Maersk recently boosted its container business by buying Hamburg Sud, a German rival with a strong position in Latin America, for $4bn (£3.1bn).