TotalEnergies E&P USA, a subsidiary of France’s energy giant TotalEnergies, has expanded its carbon capture and storage (CCS) arsenal by acquiring Talos Low Carbon Solutions (TLCS), a subsidiary of the U.S.-based Talos Energy. The sale entails all assets in Talos’ CCS business, including its three projects along the U.S. Gulf Coast.
TotalEnergies will pay $125 million for these assets plus customary reimbursements, adjustments, and retention of cash, which combined totals approximately $148 million. Talos intends to use the proceeds from the sale to repay borrowings under its credit facility and for general corporate purposes. Upon the completion of the transaction, the French player will own a 25% share in the Bayou Bend project, alongside Chevron (50%, operator) and Equinor (25%). This is a major CO 2 storage project located along the Texas Gulf Coast, close to the company’s assets in the region.
Patrick Pouyanné , Chairman and CEO of TotalEnergies, commented: “ TotalEnergies is pleased to enter the Bayou Bend project through the acquisition of Talos Low Carbon Solutions. Ideally located close to our Port Arthur refinery and our petrochemicals assets in La Porte, this project will be instrumental for the reduction of direct emissions from our US operations. This transaction gives momentum to the decarbonization of hard-to-abate US emissions and marks a milestone on our journey to get to net zero by 2050, together with society.”
The Bayou Bend project is a carbon transportation and storage solution for industrial emitters located in the Houston Ship Channel and Beaumont – Port Arthur region, one of the largest industrial corridors in the United States. Comprising licenses dedicated to CO 2 storage, offshore and onshore, covering about 600 km 2 , the project could enable the storage of several hundred million tons of CO 2 .
In addition, TotalEnergies will own a 65% operated interest in the Harvest Bend (Louisiana) project and a 50% interest in the Coastal Bend (Texas) project. With these assets being located farther away from the oil major’s other existing assets, the firm intends to divest its interest in these two projects after the closing of the acquisition.
Timothy S. Duncan , Talos’ President and CEO, highlighted: “Since TLCS’s inception, we have successfully applied our energy expertise as an early mover aimed at developing decarbonization solutions along the U.S. Gulf Coast. Strong market interest during our capital raise provided the strategic option to fully monetize the business to TotalEnergies, an established global leader in CCS development.
“Robin and our entire CCS team did an outstanding job crystallizing value for Talos shareholders for a strong financial return. The transaction will further enable Talos to prioritize cash flow generation and optimal capital allocation in our core Upstream business. We are also continuing to explore business development and strategic M&A opportunities.”
TotalEnergies underlines that it is on track to enable significant decarbonization of European businesses through projects such as Northern Lights in Norway, Aramis in the Netherlands, and Bifrost in Denmark.