BP and Total deepen commitments to U.S. with major projects

BP logo in Buckinghamshire, England, on Jan. 15, 2015. (AP / Matt Dunham)

HOUSTON/LONDON — European oil and gas majors BP and TotalEnergies on Monday deepened their commitments to the United States, with BP approving a US$5 billion offshore oil field and TotalEnergies buying into an onshore gas field.

Higher investment in U.S. oil and gas production aligns with U.S. President Donald Trump’s goal to capitalize on the country’s hydrocarbon resources.

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BP, which currently produces around 2.3 million barrels of oil equivalent per day, is becoming increasingly reliant on the United States to shore up its oil and gas business following a strategic revamp announced in February to shift spending from renewables to hydrocarbons.

Increasing U.S. exposure

BP has vowed to increase its U.S. production to just over 1 million boed by the end of the decade, or just under half of its global target of 2.3 million to 2.5 million boed in that timeframe.

Its US$5 billion Tiber-Guadalupe project in the Gulf of Mexico, expected to begin production in 2030, will include a floating 80,000 boed platform to tap into an estimated 350 million boe in recoverable resources, BP said.

BP is considering selling minority stakes in Tiber as well as another fully BP-owned Gulf of Mexico project, Kaskida, sources have told Reuters.

French rival TotalEnergies said on Monday it would buy a 49 per cent stake in Continental Resources’ onshore gas fields in the U.S. state of Oklahoma, for an undisclosed sum.

The assets will net it around 150 million standard cubic feet per day of gas by 2030, or about 26,000 boed, helping to secure access to low-cost upstream gas as the company signs deals to deliver the fuel via ship to mostly Asian clients.

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TotalEnergies is the largest buyer of U.S. liquefied natural gas, purchasing 10 million metric tons per year, but its own output in the United States is much smaller.

Its U.S. upstream assets last year produced 93,000 boed, or about 3.8 per cent of Total’s global production, far behind its assets in Africa, Europe, the Middle East, Asia and Latin America.

This is set to change as Total seeks to balance its U.S. LNG purchases with increasing its own gas production in the country.

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Reporting by Sheila Dang in Houston, Stephanie Kelly in London, America Hernandez in Paris. Writing by Shadia Nasralla. Editing by Marguerita Choy, Barbara Lewis and Mark Potter