The headquarters of the Spanish oil group Repsol, in Madrid, on December 16, 2014 (AFP/Archives/PIERRE-PHILIPPE MARCOU)
The Spanish oil group Repsol on Wednesday accelerated its transition to a “multi-energy” model by selling 25% of its hydrocarbon exploration-production branch for 4.8 billion dollars to finance investments in the renewables sector.
After several weeks of negotiations, an agreement was reached with the American investment fund EIG for a “25% stake” in “the exploration and production branch (Upstream)” of Repsol, announced the group in a press release.
As majority shareholder, Repsol will retain control of this branch of activity, which operates deposits in South America (Brazil, Peru, Venezuela, etc.) or North Africa (Algeria, Libya) and is expected to produce 570,000 barrels of oil equivalent per day this year.
The agreement, which values the upstream branch at 19 billion dollars, also provides for a possible IPO of these activities “from 2026 if market conditions are favorable”, a priori in the United States, specifies the group. , a European hydrocarbon heavyweight.
Thanks to this new agreement, “Repsol will achieve the key objectives of its 2025 strategy, based on the acceleration of the group’s energy transition, sooner than expected, assures in its press release the Spanish giant, which aims to become a “multi -energetic”.
This plan, presented at the end of 2020, provides in particular for 18.3 billion euros in investments by 2025. The objective is to allow the group to gradually turn to renewable energies or “green hydrogen” (produced with using renewable energy sources), with a view to achieving “net zero emissions” of CO2 “by 2050”.
This date of 2050 has been chosen by the European Union, but also by several other countries such as Japan and by many companies to achieve carbon neutrality.
– Investments in renewables –
This operation is the second large-scale in less than three months for Repsol, which announced in mid-June the sale of 25% of its branch dedicated to renewable energies to Crédit Agricole Assurances and the Swiss fund Energy Infrastructure Partners (EIP) for 905 millions of euros.
This operation, again intended to increase the oil group’s investment capacity in the so-called “low carbon” energy sector, should be finalized in the fourth quarter, according to the Spanish group.
The money recovered as part of this strategy will allow Repsol to “finance” “important projects” that the group “has for the years to come”, in connection “with the decarbonization” of the economy, underlined in a video the director general of Repsol, Josu Jon Imaz.
According to Mr. Imaz, the Spanish group will not leave the oil and gas sector, however, as these energies are “necessary” for an “orderly” energy transition. But “we must reduce the carbon impact of our products”, he insisted.
Repsol has multiplied in recent months the announcements of projects in the renewable sector, particularly in solar and wind power, where its production capacity amounted to 3.8 gigawatts at the end of 2021. Its objective is to reach a total of 15 GW in 2030.
On the Madrid Stock Exchange, the Repsol title was stable at 11:00 GMT, in a market down 0.15%. In a note, the investment bank RBCCM considered the agreement with EIG to be “positive”, as it was likely to “support Repsol’s long-term strategy” with regard to renewables.
Most of the oil groups, like the French TotalEnergies, the British BP or the Anglo-Dutch Shell, have undertaken in recent years, to varying degrees, a diversification of their activities in the renewable energy sector.
This transition is nevertheless considered too slow by NGOs and scientists, who have been calling for years to drastically reduce the use of fossil fuels to fight against global warming.
© 2022 AFP
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