French supermajor Total is in talks to sell its 18% stake in an oil field in Iraq’s semi-autonomous Kurdistan region, with which it could raise around $ 500 million, Bloomberg reported, citing sources familiar with the matter.
Total is working with Jefferies Group on the potential sale of its stake in the Sarsang exploration block in northern Iraqi Kurdistan, which is operated by HKN Energy, a subsidiary of Dallas-based Hillwood International Energy.
Total is considering divesting its assets to cope with this year’s drop in oil prices and is preparing for the future of low-carbon energy. Total ended up with the stake in the Sarsang block after buying Maersk Oil, for which the block in the Iraqi region was a major asset.
According to Bloomberg sources, discussions are ongoing and no final selling decision has yet been made. While seeking to sell non-strategic assets, Total aims to reduce emissions and become a large energy company, like all European majors.
Total wants to increase its energy production by a 3rd, with half of the growth coming from LNG and the other half from electricity, mainly from renewable energies.
Total CEO Patrick Pouyanné told French newspaper Le Parisien in September that the company intends to be among the world’s top 5 producers of renewable energy. The company’s operating mix today is 55% oil, 40% gas and less than 5% electricity from renewable sources, Pouyanné said, noting that in 2050, Total’s operations will be divided into 20% oil, 40% gas and 40% renewable energy. .
Pouyanné said last week that strict investment discipline would be vital to following a 2 degree Celsius trajectory. “We are focusing on projects that can withstand low oil prices and higher carbon costs. This is the best way to protect against the risk of stranded assets, ”said the executive.