PARIS, Aug. 27 (UPI) — French energy company Total said Thursday it was selling a gas terminal and associated pipeline infrastructure in the British North Sea to release more capital.
The company said it was selling its stake in the St. Fergus gas terminal to the region’s North Sea Midstream Partners for around $905 million.
“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,” Total Chief Financial Officer Patrick de La Chevardiere said in a statement.
North Sea Midstream Partners will operate the pipeline infrastructure on behalf of regional operating partners. The company said adding the gas assets to its portfolio would help ensure North Sea sector durability.
“We see midstream infrastructure as crucial to the longevity of the North Sea and firmly believe that the independent ownership of such infrastructure can help maximise the ultimate economic recovery of the British continental shelf’s oil and gas reserves, consistent with the findings of the Wood Review,” Chief Executive Officer Andy Heppel said.
The British government last year said it was moving forward with recommendations from retired businessman Ian Wood, who found there may be an additional 4 billion barrels of oil equivalent available for recovery in the North Sea.
In July, the French energy company attributed cost-cutting to only modest declines in profits, which were down 4 percent to $2.97 billion in the second quarter. Revenue for Total was down 29 percent to $44.7 billion.
For North Sea Midstream Partners, the deal comes amid an expected upturn in the North Sea energy sector. Though most regional fields are in decline, industry body Oil & Gas U.K. said a report on the first half of the year production from offshore basins is on pace to increase.
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