PARIS - TotalEnergies (EPA:TTEF) (Paris:TTE) (LSE:TTE) (NYSE:TTE) is poised to become the sole owner of SapuraOMV Upstream Sdn (SapuraOMV) following the signing of an agreement to acquire a 50% stake from Sapura Upstream Assets Sdn Bhd (SUA) for $530 million, subject to customary closing adjustments. This move comes after an initial agreement to purchase OMV's 50% share in SapuraOMV on January 31st, 2024. Both transactions are expected to close in the second half of 2024, pending regulatory approvals and other conditions.
SapuraOMV's key assets include a 40% operated interest in block SK408 and a 30% operated interest in block SK310, both situated offshore in Malaysia's Sarawak region. The company's 2023 output contributed approximately 500 Mcf/d of natural gas and 7 kb/d of condensates, supporting operations at the Petronas-operated Bintulu LNG plant. Additionally, SapuraOMV has stakes in exploration licenses across Malaysia, Australia, New Zealand, and Mexico, with a notable discovery in Mexico's block 30 in 2023.
Patrick Pouyanné, Chairman and CEO of TotalEnergies, expressed the strategic alignment of the acquisition, highlighting the growth of gas production to meet increasing demand and the emphasis on low-cost, low-emission assets. He also underscored the potential for further development in Malaysia and the strengthening of TotalEnergies' partnership with Petronas.
TotalEnergies, an integrated global energy company, has a diverse portfolio that includes oil, biofuels, natural gas, green gases, renewables, and electricity. With a workforce exceeding 100,000 employees, the company operates in approximately 120 countries, focusing on delivering sustainable energy solutions.
The acquisition is part of TotalEnergies' broader presence in Malaysia, where it also holds interests in two exploration phase Production Sharing Contracts (PSCs) and has signed an agreement in June 2023 with Petronas and Mitsui to develop a carbon storage project in Southeast Asia.
This strategic expansion by TotalEnergies is based on a press release statement.
InvestingPro Insights
As TotalEnergies (NYSE:TTE) moves forward with its strategic acquisition in Malaysia, its financial health and market performance continue to be of interest to investors. According to InvestingPro real-time data, TotalEnergies boasts a robust market capitalization of $174.34 billion USD, underscoring its significant presence in the energy sector. The company's P/E ratio stands at 8.17, suggesting an attractive valuation relative to its earnings. Additionally, with a PEG ratio of 0.77 for the last twelve months as of Q4 2023, TotalEnergies may offer growth at a reasonable price.
From an operational standpoint, TotalEnergies has demonstrated a strong return over the last three months, with a price total return of 14.89%. This performance is indicative of the company's resilience and the positive reception of its strategic decisions by the market. Furthermore, the company's dividend yield as of March 2024 is 3.26%, which is a testament to its commitment to returning value to shareholders, having maintained dividend payments for 48 consecutive years.
Two InvestingPro Tips that may be particularly relevant to investors considering TotalEnergies' latest move include its position as a prominent player in the Oil, Gas & Consumable Fuels industry and its trading at a low P/E ratio relative to near-term earnings growth. These insights suggest that TotalEnergies is well-positioned within its industry and may be undervalued based on its growth prospects. For investors seeking further analysis and tips, there are 8 additional InvestingPro Tips available on the platform for TotalEnergies, which can be accessed with an additional 10% off a yearly or biyearly Pro and Pro+ subscription using the coupon code PRONEWS24.
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