United States: TotalEnergies Expands its Natural Gas Production in Texas
TotalEnergies acquires Lewis Energy Group's 20% interest in Dorado leases, boosting natural gas production capacity in Texas and strengthening U.S. LNG integration. The acquisition will increase TotalEnergies' net U.S. natural gas production by 50 Mcf/d in 2024, with potential for more in 2028. The company aims to reach 15 Mt/y LNG export capacity by 2030 with projects like Rio Grande LNG. TotalEnergies is the world's third-largest LNG player, focusing on increasing natural gas sales mix to 50% by 2030.
Positive
TotalEnergies' acquisition of Lewis Energy Group's 20% stake in Dorado leases enhances its natural gas production capacity in Texas.
The deal will boost TotalEnergies' net U.S. natural gas production by 50 Mcf/d in 2024, with potential for further increases by 2028.
The company aims to achieve a 15 Mt/y LNG export capacity by 2030 through projects like Rio Grande LNG in Texas.
TotalEnergies is the world's third-largest LNG player, with a global portfolio of 44 Mt/y in 2023, focusing on increasing natural gas sales mix to close to 50% by 2030.
The acquisition strengthens TotalEnergies' position in the U.S. LNG market and aligns with its goal to reduce carbon emissions and promote the transition from coal to natural gas.
The acquisition by TotalEnergies of a 20% interest in the Dorado leases in the Eagle Ford shale gas play represents a strategic move to bolster its position in the U.S. natural gas market. This move is expected to increase TotalEnergies' net U.S. natural gas production by 50 million cubic feet per day (Mcf/d) in 2024, with potential further increases by 2028. Considering the current natural gas prices and market trends, this could significantly enhance TotalEnergies' revenue from its U.S. operations.
Furthermore, the integration into the U.S. LNG value chain is noteworthy. As the largest exporter of U.S. LNG, TotalEnergies' expansion in natural gas production is likely to improve its supply stability for LNG export operations, which is important given the volatile nature of global energy markets. The company's position as a leading LNG player is reinforced by its stake in the Cameron LNG plant and the upcoming Rio Grande LNG project. This vertical integration can be seen as a hedge against market fluctuations and a step towards a more resilient business model in the energy sector.
From an environmental perspective, the reported emission intensity of around 10 kg CO2e/boe for the Dorado field is a figure that stakeholders should consider. In comparison to industry norms, this intensity level is relatively low, which aligns with the growing investor and consumer demand for cleaner energy production. TotalEnergies' commitment to reducing carbon emissions and eliminating methane emissions is aligned with global efforts to transition to lower-carbon energy sources.
However, the expansion of fossil fuel operations, such as natural gas, must be weighed against the long-term goal of reducing greenhouse gas emissions and combating climate change. The company's involvement in renewables, CCS (Carbon Capture and Storage) and low-carbon fuels is a positive sign, though the scale and effectiveness of these initiatives in offsetting emissions from increased natural gas production remain to be critically evaluated.
The U.S. energy policy landscape significantly influences TotalEnergies' strategic decisions. The increase in natural gas production capacity and the integration into the LNG value chain align with the U.S. policy of promoting energy independence and export capacity. The U.S. has been encouraging the development of its natural gas resources and the expansion of LNG exports to create jobs, support allies and exert geopolitical influence.
TotalEnergies' investment in the U.S. also reflects the broader trend of energy companies adapting to the energy transition by diversifying their portfolios to include both traditional and renewable energy sources. The company's investments in renewable energy projects and the LNG sector are an example of how energy companies are positioning themselves in a changing policy environment where there is pressure to provide cleaner energy while also ensuring energy security.
04/08/2024 - 02:40 AM
PARIS --(BUSINESS WIRE)--
Regulatory News:
TotalEnergies (Paris:TTE) (LSE:TTE) (NYSE:TTE) has agreed to acquire the 20% interest held by Lewis Energy Group in the Dorado leases operated by EOG Resources (80% ) in the Eagle Ford shale gas play, increasing its natural gas production capacity in Texas and further strengthening its business integration in the U.S. LNG value chain.
TotalEnergies increases its natural gas production in the U.S
Located in Texas , the Dorado field will allow TotalEnergies to increase its net U.S. natural gas production by 50 million cubic feet a day (Mcf/d) in 2024, with the potential for an additional 50 Mcf/d by 2028. The field has an emission intensity of around 10 kg CO2 e/ boe. In 2023, TotalEnergies’ net U.S. natural gas output reached around 340 Mcf/d (450 Mcf/d technical production).
TotalEnergies, largest exporter of U.S. LNG
With over 10 million tons (Mt) in 2023, TotalEnergies was the number one exporter of U.S. LNG, thanks to its 16.6% stake in the Cameron LNG plant in Louisiana and several long-term purchasing agreements. The Company’s LNG export capacity will reach 15 Mt/y by 2030 following the start-up of the first phase of the Rio Grande LNG project in Texas , currently under construction.
"This acquisition strengthens our production of natural gas in the United States , contributing to reinforce TotalEnergies' LNG integration with a low cost and low emission upstream gas feed,” said Nicolas Terraz, President, Exploration & Production at TotalEnergies . "We are pleased to partner with EOG Resources, an operator recognized for its strong technical expertise.”
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TotalEnergies in the United States
TotalEnergies is deploying its integrated energy model in the United States , where it has been active since 1957. With over 10 Mt of output in 2023, TotalEnergies is the leading exporter of US LNG, thanks to its 16.6% stake in the Cameron LNG plant in Louisiana and long-term supply contracts. By 2030, this capacity will reach 15 Mt/y, following the start-up of the Rio Grande LNG plant in South Texas .
Texas , the Company is integrated throughout the LNG value chain.
Texas , and a trading center in Houston .
Mexico , and in refining and petrochemicals, centered on its platform in Port Arthur (Texas ). TotalEnergies is also present in CCS and in low-carbon fuels, such as biogas and e-NG.
TotalEnergies, the world’s third largest LNG player
TotalEnergies is the world’s third largest LNG player with a global portfolio of 44 Mt/y in 2023 thanks to its interests in liquefaction plants in all geographies. The Company benefits from an integrated position across the LNG value chain, including production, transportation, access to more than 20 Mt/y of regasification capacity in Europe , trading, and LNG bunkering. TotalEnergies’ ambition is to increase the share of natural gas in its sales mix to close to 50% by 2030, to reduce carbon emissions and eliminate methane emissions associated with the gas value chain, and to work with local partners to promote the transition from coal to natural gas.
About TotalEnergies
TotalEnergies is a global integrated energy company that produces and markets energies: oil and biofuels, natural gas and green gases, renewables and electricity. Our more than 100,000 employees are committed to provide as many people as possible with energy that is more reliable, more affordable and more sustainable. Active in about 120 countries, TotalEnergies places sustainability at the heart of its strategy, its projects and its operations.
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Cautionary Note
The terms “TotalEnergies”, “TotalEnergies company” or “Company” in this document are used to designate TotalEnergies SE and the consolidated entities that are directly or indirectly controlled by TotalEnergies SE. Likewise, the words “we”, “us” and “our” may also be used to refer to these entities or to their employees. The entities in which TotalEnergies SE directly or indirectly owns a shareholding are separate legal entities. This document may contain forward-looking information and statements that are based on a number of economic data and assumptions made in a given economic, competitive and regulatory environment. They may prove to be inaccurate in the future and are subject to a number of risk factors. Neither TotalEnergies SE nor any of its subsidiaries assumes any obligation to update publicly any forward-looking information or statement, objectives or trends contained in this document whether as a result of new information, future events or otherwise. Information concerning risk factors, that may affect TotalEnergies’ financial results or activities is provided in the most recent Universal Registration Document, the French-language version of which is filed by TotalEnergies SE with the French securities regulator Autorité des Marchés Financiers (AMF), and in the Form 20-F filed with the United States Securities and Exchange Commission (SEC).
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TotalEnergies Contacts
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Source: TotalEnergies SE
What is the impact of TotalEnergies' acquisition of Lewis Energy Group's 20% interest in Dorado leases?
The acquisition boosts TotalEnergies' natural gas production capacity in Texas.
What is the potential increase in TotalEnergies' net U.S. natural gas production by 2028?
TotalEnergies aims to potentially increase its net U.S. natural gas production by an additional 50 Mcf/d by 2028.
What is TotalEnergies' LNG export capacity goal by 2030?
TotalEnergies aims to achieve a 15 Mt/y LNG export capacity by 2030.
How does TotalEnergies plan to increase its natural gas sales mix by 2030?
TotalEnergies aims to increase the share of natural gas in its sales mix to close to 50% by 2030.
What is TotalEnergies' position in the U.S. LNG market?
TotalEnergies is strengthening its position in the U.S. LNG market with the acquisition and projects like Rio Grande LNG in Texas.
