Malaysian oil & gas firm swoops up TotalEnergies’ Brunei business for $259 million

France’s energy giant TotalEnergies has set the wheels in motion to divest its affiliate in Brunei to Hibiscus Petroleum, a Malaysian independent oil and gas exploration and production company, enabling the latter to take over an offshore asset.

TotalEnergies’ sale of its wholly-owned subsidiary, TotalEnergies EP (Brunei), to Hibiscus Petroleum for $259 million is expected to close in the fourth quarter of 2024. The French player’s Brunnei business arm owns and operates a 37.5% interest in Block B, with Shell Deepwater Borneo (35%) and Brunei Energy Exploration (27.5%) as partners.

Located 85 kilometers off the coast of Brunei, the block contains the Maharaja Lela/Jamalulam (MLJ) field, which came on stream in 1999. The field represented a net production for TotalEnergies of approximately 9,000 barrels of oil equivalent per day in 2023.

Jean-Pierre Sbraire, CFO of TotalEnergies, commented: “This transaction fits with our strategy to actively manage our portfolio by monetizing mature assets and to allocate our talents to the most promising assets.”

Hibiscus expects Block B to add a net of up to 21.7 MMboe to its 2P reserves, a hike of 36% from 60.9 MMboe to 82.6 MMboe as of January 1, 2024, while total daily net production of oil, condensate, and gas is anticipated to increase by about 7,865 boe per day from 21,398 boe per day to 29,263 boe per day in CY2024.

According to the Malaysian firm, the acquisition will bring the gas production share of its portfolio to almost 50%, which is aligned with its energy transition strategy of acquiring gas-weighted assets in stable regulatory jurisdictions.

Dr. Kenneth Pereira, Hibiscus Petroleum’s Managing Director, remarked: “The additional volumes from this transaction are material for Hibiscus Petroleum and will provide an uplift of nearly 86% to our gas production whilst bringing us closer towards achieving our 2026 mission of growing the group’s net production to 35,000 – 50,000 boe per day.

“In addition, employees of TotalEnergies Brunei, who have been operating this asset safely and efficiently for many years will be joining the group as part of the transaction.”

TotalEnergies is currently working on multiple projects, spanning geographies. A few days ago, the French giant made a hull reservation with SBM Offshore for a floating production storage and offloading (FPSO) unit destined to work at its oil project offshore Suriname.

The company also recently made a final investment decision (FID) for a solar-powered LNG project in Oman and another for an oil project offshore Angola.