Esbjerg-based companies: TOTAL’s acquisition of Maersk Oil is good news

However, it will mark the end of an era at the Port of Esbjerg when Maersk Oil welcomes its new owners at the end of the year, assuming the deal obtains regulatory approval. Maersk has resided at the Port of Esbjerg since 1962, when the company obtained exploration rights for the oil and gas fields in the North Sea.

The oil and gas venture has really taken off since then, and Maersk Oil today owns one third of DUC (Dansk Undergrunds Consortium), which accounts for about 90% of total Danish production in the North Sea.

The French oil behemoth TOTAL will now take the lead in the North Sea, which is good news, according to Lars Skov, Senior Vice President of SEMCO’s rig activities in the North Sea:

“In my opinion, TOTAL’s acquisition of Maersk Oil is a cause for optimism across the board. It is good news for Denmark’s activities in the North Sea and thus for all the subcontractors at the Port of Esbjerg currently providing services and equipment to Maersk Oil,” he says.

Flemming Copsø, CEO of COPCO, a chemicals company, agrees. Like Mr Skov and SEMCO, he has a solid business relationship with Maersk Oil from the company’s head office at the Port of Esbjerg. They are both looking forward to continuing the collaboration on North Sea activities with TOTAL. 

With the deal in place, we can now look ahead

Since Maersk presented its new strategy last autumn designating transport and logistics as the Group’s main focus, many of Maersk Oil's subcontractors have been holding their breath. A change of ownership may have huge consequences for the business, explains Mr Copsø, whose company, COPCO, supplies chemical solutions to the oil and gas platforms in the North Sea.

Ever since he started the business in 1991, Maersk Oil has been a key business partner, so he was relieved to hear the news about the new owners:

“It is really good that we now have clarity on the future of Danish oil and gas production. I have of course been keeping tabs on things and I knew something was brewing,” he says, adding that, in his view, the change of ownership is very good news:

“Maersk Oil has been a strong driving force for the Port of Esbjerg for more than half a century, but with their new strategy, it was clear that they would not be making the necessary investments in the North Sea. That is why having a new owner like TOTAL, which has the muscle and a clear focus on developing their oil and gas activities, is positive news.”

Lars Skov, Senior Vice President of SEMCO, shares this opinion. In March this year, SEMCO signed its largest contract to date with Maersk Oil to supply personnel for North Sea operations over the next five years. Mr Skov has therefore been awaiting the outcome of this state of limbo over the past year with equal measures of anxiety and excitement.

“As the vast majority of our activities are in the North Sea, we were well aware that what happened with Maersk Oil would have a huge impact on our business. In my view, this is a good outcome. When an oil company like TOTAL is the buyer it conveys a strong signal that they intend to expand their business and invest further in Denmark and Esbjerg – I am looking forward to that,” says Mr Skov.  

Bright prospects for North Sea activities

Indeed, everything suggests that TOTAL’s acquisition of Maersk Oil will prolong the life of the Danish oil and gas fields.

TOTAL has announced they will continue the existing activities in Esbjerg, where some 1,200 people are currently working for Maersk Oil; 600 at the head office at the port and the rest on platforms in the North Sea. TOTAL has also stated that the redevelopment of the Tyra field will be completed as planned.

The French company expects to produce a total of 500,000 barrels per day in the North Sea following the acquisition of Maersk Oil. Today, TOTAL’s oil production is primarily concentrated in Norwegian waters, where the company produces 235,000 barrels of oil equivalent (boe) per day. Combining TOTAL’s current activities in the North Sea with Maersk Oil’s activities will make the French oil behemoth the second largest producer in the North Sea, surpassed only by Statoil.

Mr Skov welcomes these ambitions. He sees a lot of unrealised potential in the North Sea which TOTAL could profitably invest in. Moreover, the current situation in the oil market is favourable in terms of exploring new opportunities:

“Oil prices remain low, but have nonetheless been stable for the past eight months. At the same time, the industry has seen massive restructuring in the wake of the recent crisis. This provides good conditions for seeking out new opportunities, and TOTAL has a successful track record of doing just that, in Africa for instance,” he explains.

More specifically, Mr Skov hopes that TOTAL will eventually start looking at some of the fields in the North Sea that DONG has previously declined to develop. Or that they will see the potential in extending operations in existing oil and gas fields to find unused reserves. 

A window to the world

In connection with the acquisition, TOTAL has made clear that they intend to make Denmark a hub for all their activities in the Netherlands, Norway, Denmark and the UK.

This announcement sends a strong signal that TOTAL has confidence in the expertise available in Denmark, according to both Mr Skov and Mr Copsø. And rightly so, says Mr Copsø. Denmark and, more specifically, Esbjerg possesses know-how and skills in the oil and gas industry which TOTAL can benefit from.

“There is a lot of know-how and knowledge of the North Sea here in Esbjerg that will definitely be useful for TOTAL, including both the in-house expertise at Maersk Oil and the network of subcontractors that we are a part of. The Port of Esbjerg has excellent infrastructure, which enables us to deliver good solutions,” he explains.

Therefore, Mr Copsø also expects the collaboration with TOTAL to pave the way for more international business for a number of the Esbjerg-based companies, including his own company, COPCO:

“At present, we mainly deliver to operations in the North Sea, but we hope that TOTAL will come to realise that our expertise and supply activities can also be useful outside the North Sea region,” says Mr Copsø, who adds that, in the long term, this could mean expanding the business and thereby creating more jobs at the head office in Esbjerg.

Mr Skov and SEMCO’s activities are also concentrated in the North Sea, in the so-called North Sea triangle made up of Norway, the UK and Denmark. Most recently, SEMCO won the hook-up contract in connection with the development of the Culzean gas production field in the UK. TOTAL will now take over this project, and Mr Skov expects it to be an excellent showcase for what SEMCO has to offer from its head office at the Port of Esbjerg.

“With TOTAL’s acquisition, we now have only one customer instead of two, and I expect this to add volume to the business, as TOTAL could be our ticket to more contracts,” he concludes.