Total has signed an agreement to divest a 4% interest in the Ichthys LNG project in Australia to operating partner INPEX for an overall consideration of US$1.6 billion. The transaction, which is subject to Australian regulatory approvals, reduces Total’s interest in the asset to 26%.
“This transaction is part of our constant portfolio review to optimise our capital allocation. Ichthys is part of a wave of Australian LNG projects, which have unfortunately experienced major cost overruns and delays during their construction phase. The final CAPEX estimate provided by the Operator is around US$45 billion to be compared to an updated figure around 40 B$ in 2017. In line with our capital discipline policy, we have therefore decided to control our capital employed in Ichthys by monetising a 4% stake after the project start-up and de-risking,” commented Arnaud Breuillac, President, Exploration & Production at Total. “We are of course committed to the Ichthys project with our remaining 26% interest contributing to our growth both in production and cash flow from 2019 and beyond. LNG is a core area for Total - the world second-largest privately owned player with a strong pipeline of low breakeven pre-FID projects in our portfolio”. At full capacity, the Ichthys offshore facilities and the two-train onshore liquefaction plant will supply 8.9 million tpy of LNG and 1.65 million tpy of LPG, along with 100 000 bpd of condensate.
The first LNG cargo was exported on the October 22nd 2018, the first offshore condensate cargo was exported on 1 October 2018, and the first LPG cargo was exported on the 16 November 2018. The two LNG trains are now fully operational.