Is France’s biggest energy firm boosting its stake in a major U.S. shale play because its home country banned fracking?
According to the Daily Caller, the years-long fracking ban in France may have prompted Total to turn its attention to unconventional reserves in the United States.
The French parliament banned fracking in 2011, citing concerns about potential environmental damage.
The ban was upheld by France’s highest court in 2012 following a challenge filed by Schuepbach Energy after the company’s exploration permits were revoked when the ban went into effect, according to the New York Times.
France may also expand that ban to include shale gas imports.
French Energy Minister Segolene Royal said in May that her department is researching possible means to ban shale gas imports, Reuters said.
While France has been reluctant to embrace hydraulic fracturing, the country’s largest energy firm is now the sole operator in one of the largest shale gas plays in the United States.
Total U.S.A. announced on Friday that it has acquired the remaining majority stake in over 200,000 Barnett shale acres from Oklahoma-based Chesapeake Energy.
Total E&P USA exercised its preemption right to acquire Chesapeake Energy’s 75 percent interests in the jointly held Barnett Shale operating area in North Texas.
Total E&P USA has owned the remaining 25 percent in the Barnett assets since December 2009.
With the preemption, Total E&P USA will be the 100 percent owner and operator of the assets.
Properties in the proposed transaction include about 215,000 net developed and undeveloped acres, wells, leases, minerals, buildings and properties.
The acquisition now makes Total the only operator in the Barnett play, according to the Wall Street Journal.
According to the U.S. Energy Information Administration, France holds unproven technically recoverable shale wet gas reserves of 136.7 trillion cubic feet.
While the France’s unproven shale gas reserves are the largest in Western Europe they fall short of the estimated 622.5 trillion cubic feet of wet shale gas in the United States.
Although Barnett shale production has been declining over the last four years, the area has played an integral role in helping upstreams perfect modern fracking technology.
According to the Texas Railroad Commission, natural gas production in the Barnett play peaked at 5.743 billion cubic feet per day in 2012 but declined to 3.89 trillion cubic feet during the first half of 2016.
“With the new conditions created by the exit of Chesapeake and the associated restructuring of the midstream contracts, we believe that we can extract significant value from the substantial, well located resource base of the play by combining focused upstream operating efficiency, streamlined midstream contract management and marketing savvy through Total’s trading affiliate Total Gas & Power North America,” Total E&P USA president and CEO José Ignacio Sanz said last week when the deal was announced.
