French oil producer TOTAL S.A. (TOT) recently acquired Esso Italiana’s 25% stake in the Gorgoglione concession, comprising the Tempa Rossa field, where the company already has a 50% stake. As part of the deal, TOTAL also bought 51.7% interest each in two other exploration licenses in the same area from Esso Italiana.
Located in Basilicata, the Tempa Rossa project is crucial for the economic development of this region. Currently, the project is progressing on the tender calls for the main development contracts while regional and governmental approvals for the project are expected to come in by the end of this summer.
The parties involved in the project expect the final investment decision and implementation work to begin by year-end 2011. The companies expect first production from the project to start in 2015 at an initial rate of 50,000 barrels of oil per day.
This acquisition strengthens TOTAL’s footprint in Italy’s exploration and production sector, highlighting its commitment as a major player in the economic development of the Basilicata region. The deal is, however, subject to the approval of Italian authorities.
France-based TOTAL is one of the largest publicly traded, globally integrated oil and gas companies based on production volumes, proved reserves and market capitalization. The company has exploration and production operations across five continents.
TOTAL continues to prudently acquire and dispose assets to make its asset base more tuned to its long-term business strategy. During first quarter 2011, TOTAL made acquisitions worth $3.46 billion and simultaneously disposed assets worth $0.4 billion.
TOTAL S.A. currently retains a Zacks #3 Rank (short-term Hold rating). The company competes with BP plc (BP) and Exxon Mobil Corporation (XOM).
