TotalEnergies, the French major with a world-class LNG portfolio of 44 million tonnes per annum, is increasing its natural gas infrastructure investments by paying £450 million ($575M) for a gas-fired power plant in the UK to help mitigate its large holdings of intermittent renewables in the British energy markets.
TotalEnergies has signed an agreement with the North American institutional investor EIG for the acquisition of all the shares of West Burton Energy in the UK Midlands.
West Burton Energy owns and operates the West Burton B gas-fired power plant in the English county of Nottinghamshire.
West Burton B comprises three combined-cycle gas turbines (CCGT) with total output of 1.3 gigawatts.
Commissioned in 2013, it is one of the UK’s most advanced power plants and supplies some 1.8 million homes. A 49 MW battery storage system was added in 2018.
“This acquisition rounds out TotalEnergies’ renewable power generation capacity in the UK with a flexible asset that mitigates intermittency to enable the supply of firm power to customers,” explained the French company.
Capacity needs
“Given the size of the company’s renewable portfolio in the country, which currently stands at 1.1 GW of gross installed capacity and 4.5 GW under development, TotalEnergies assesses its need for gas-based power generation capacity at 700 MW, so the company therefore plans to divest 50 percent of the acquired assets,” TotalEnergies added.
“The deal will also allow TotalEnergies to strengthen its trading capabilities in the country’s electricity and gas markets,” said the company.
TotalEnergies plans to supply the gas-fired power plant from its natural gas production in the UK where it operates 30 percent of the projects.
Earlier in June, TotalEnergies also signed two new LNG medium-term and long-term LNG accords in Asia.
These comprised a sales and purchase agreement (SPA) with Indian Oil Corp. (IOCL) for the delivery to India of up to 800,000 tonnes per annum of LNG for 10 years from 2026.
Korean LNG
The second accord was a heads of agreement with Korea South-East Power for the delivery to South Korea of up to around 500,000 tonnes per annum of LNG for five years from 2027.
The company said that these agreements allow TotalEnergies to secure medium-term outlets for its global LNG supply portfolio.
They also strengthen the company's footprint in Asian markets, where it is particularly committed to supporting its customers with their decarbonization strategies.
