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Total’s deal with Chevron for assets in the Gulf of Mexico shows that the French oil major’s appetite for exploration is returning. an analyst said today.
Valentina Kretzschmar. director of corporate analysis at Wood Mackenzie. also said Total’s $237 acquisition of a 23 percent stake in renewable energy company Eren demonstrated its commitment to green power.
Ms Kretzschmar said: “Total is sharpening its long-term focus by increasing its exposure to deepwater exploration and renewables.
“The exploration partnership with Chevron covers 16 blocks in deepwater Gulf of Mexico (GoM). and captures seven prospects operated by Chevron.
“The move is an indication that Total’s appetite for exploration is coming back. Since 2009. Total’s GoM drilling has been operated by Cobalt under their strategic alliance for the basin. This led to the large North Platte discovery in 2012. followed by several dry exploration wells.
“The new Chevron partnership could revitalise Total’s portfolio in the GoM.“
On the Eren purchase. she said: “Total still lacks exposure to offshore wind projects. which in Wood Mackenzie’s view provides the scale and scalability. on a par with upstream mega-projects.“
Ms Kretzschmar added: “The acquisition of Maersk Oil ticked many boxes. but it did not address Total’s long-term growth challenge. We expect Total to focus on accessing long-life. low-cost resources. while continuing to high-grade its portfolio.
“Mergers and acquisitions. discovered resource opportunities and exploration are all on the cards. supported by its strong financial position. Increasing exposure to gas and renewables will remain strategic priorities.“
