TotalEnergies sells Brunei operations to Hibiscus Petroleum

French energy giant TotalEnergies has recently announced the sale of its operations in Brunei to Malaysian company Hibiscus Petroleum for a substantial sum of $259.4 million. This decision aligns with TotalEnergies' strategic focus on divesting mature assets to channel resources into more promising ventures. One such venture includes their plan to allocate 30% of their exploration budget for 2024 towards projects in Namibia.

The acquisition presents a significant opportunity for Hibiscus Petroleum to establish a presence in Brunei's energy sector by acquiring a well-established natural gas asset in a stable neighboring country. The deal involves Hibiscus taking over TotalEnergies' 37.5% stake in Block B, which encompasses the MLJ field situated 85 km offshore. Currently, this asset yields 9,000 barrels of oil equivalent per day and holds production rights until 2039.

Post-acquisition, Hibiscus anticipates a substantial increase in gas and condensate production by 7,900 barrels of oil equivalent per day in 2024. The company aims to optimize operational efficiency, cut down costs, and invest in extending the field's productive lifespan. The transaction is slated to be completed in the fourth quarter of 2024.

While the purchase is not expected to impact Hibiscus Petroleum's profits for the financial year ending in June 2024, the company foresees promising profitability in the future. Block B is a joint venture involving Shell Deepwater Borneo (35%) and Brunei Energy Exploration Sdn Bhd (27.5%), a company owned by the Brunei Minister for Finance Corporation.

The sale of TotalEnergies' Brunei operations to Hibiscus Petroleum marks a strategic move for both companies. TotalEnergies' divestment strategy opens up avenues for new investments, while Hibiscus Petroleum gains a valuable asset in Brunei's energy sector. This acquisition not only enhances Hibiscus' production capabilities but also sets the stage for future growth and profitability in the region.