Scotland: TotalEnergies Farms Down 25.5% of the Seagreen Offshore Wind Farm to PTTEP
- TotalEnergies secures a significant investment of $689 million from PTTEP, contributing to a $4.3 billion enterprise value for the Seagreen offshore wind farm.
- The offshore wind farm has a substantial capacity of 1,075 MW and is fully operational, providing electricity to power more than 1.6 million homes.
- The partnership with PTTEP and the exploration of renewable energy opportunities align with TotalEnergies' transition strategy and profitability targets.
- None.
Insights
The divestment of a 25.5% equity stake in the Seagreen offshore wind farm by TotalEnergies to PTTEP represents a strategic realignment of assets, optimizing the company's portfolio towards renewable energy sources. The transaction's valuation at a multiple of 13 times the expected average EBITDA for the next five years indicates a premium against the backdrop of an accelerating global shift to sustainable energy. The enterprise value of $4.3 billion for the wind farm underscores the significant capital investments and anticipated returns in the renewable sector.
The partnership expansion into renewable energies through a Memorandum of Understanding (MoU) suggests a long-term strategic collaboration, potentially leading to increased competitiveness and diversification. For stakeholders, the short-term cash inflow from the sale could be directed towards further renewable investments or strengthening the balance sheet, while the long-term implications include a more sustainable and possibly profitable energy mix.
Energy sector investors may interpret this move as a positive step towards TotalEnergies' commitment to net zero by 2050 and its target of 35 GW of renewable capacity by 2025. The deal may also serve as a bellwether for future valuations and partnerships within the industry.
From a financial perspective, TotalEnergies' sale of a stake in the Seagreen offshore wind farm for £522 million enhances liquidity and may improve return on capital employed (ROCE), a critical metric for energy companies. The deal's multiple of 13 times EBITDA suggests confidence in the project's profitability and the growing investor appetite for renewable assets. The projected EBITDA is a crucial indicator of operational performance and future cash flow generation capabilities.
Investors should note that the transaction's completion is contingent upon governmental and regulatory approvals, which introduces a degree of uncertainty. The impact on TotalEnergies' stock performance will depend on market perception of the company's strategic shift and the actualization of profitability targets in the Integrated Power business.
It is also worth considering the effect of currency exchange rates on the deal's value, as fluctuations between the pound sterling and the dollar could influence the final transaction amount received by TotalEnergies.
The Seagreen project, being the world's deepest fixed bottom wind farm, represents a significant technological and environmental milestone. The capacity to power over 1.6 million homes aligns with global sustainability goals and the transition to low-carbon energy sources. TotalEnergies' continued investment in offshore wind, with a portfolio exceeding 16 GW, positions the company as a leader in the transition to sustainable energy.
The collaboration with PTTEP reflects a broader industry trend where traditional oil and gas companies are increasingly partnering with national energy firms to leverage their expertise in large-scale energy projects, while diversifying into renewables. This strategic pivot is not only a response to environmental concerns but also a business imperative, as the renewable energy market continues to exhibit high growth potential.
For the broader community, the expansion into renewables promises environmental benefits and supports the creation of a resilient and diversified energy supply chain, which is critical in the context of climate change and energy security concerns.
TotalEnergies (Paris:TTE) (LSE:TTE) (NYSE:TTE):
In line with its renewables business model, TotalEnergies has signed an agreement with Thailand’s national oil and gas company PTTEP for the sale of a
This transaction implies an enterprise value of
With a total capacity of 1,075 MW, Seagreen is the world’s deepest fixed bottom wind farm. Fully operational since October 2023, Seagreen is comprised of 114 turbines which can provide enough electricity to power more than 1.6 million homes, equivalent to two-thirds of all homes in
In addition, TotalEnergies and PTTEP have signed a Memorandum of Understanding (MoU) to explore joint opportunities in the development of renewable energies.
"After a long history of partnership in gas production in
“PTTEP is also very delighted to extend its partnership and collaboration with TotalEnergies in offshore wind as well as other potential renewable energy to foster mutual business growth in the future. The success also marks a significant step for PTTEP in diversifying into the high-growth potential clean energy sector for a sustainable future”, said Montri Rawanchaikul, CEO of PTTEP.
The completion of the transaction is subject to receipt of applicable governmental and regulatory approvals.
TotalEnergies and offshore wind
TotalEnergies’ portfolio in offshore wind has a total capacity of more than 16 GW, with most farms bottom-fixed. These projects are located in the
TotalEnergies and electricity
As part of its ambition to get to net zero by 2050, TotalEnergies is building a world class cost-competitive portfolio combining renewables (solar, onshore and offshore wind) and flexible assets (CCGT, storage) to deliver clean firm power to its customers. At the end of 2023, TotalEnergies’ gross renewable electricity generation installed capacity was 22 GW. TotalEnergies will continue to expand this business to reach 35 GW in 2025 and more than 100 TWh of net electricity production by 2030.
About TotalEnergies
TotalEnergies is a global multi-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 energy that is ever more affordable, cleaner, more reliable and accessible to as many people as possible. Active in more than 130 countries, TotalEnergies puts sustainable development in all its dimensions at the heart of its projects and operations to contribute to the well-being of people.
@TotalEnergies TotalEnergies TotalEnergies TotalEnergies
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
Media Relations: +33 (0)1 47 44 46 99 l presse@totalenergies.com l @TotalEnergiesPR
Investor Relations: +33 (0)1 47 44 46 46 l ir@totalenergies.com
Source: TOTALENERGIES SE
FAQ
What is the agreement signed by TotalEnergies (TTE) with PTTEP related to?
What is the capacity of the Seagreen offshore wind farm and how many turbines does it consist of?
What is the expected average EBITDA multiple for the Seagreen offshore wind farm over the next 5 years?
What is TotalEnergies' ambition in terms of renewable electricity generation capacity by 2030?
