TotalEnergies has agreed to divest its fully owned subsidiary TotalEnergies EP (Brunei) to Malaysian independent oil and gas exploration and production company Hibiscus Petroleum in a deal worth $259m.

Under the terms of the conditional share purchase agreement, Hibiscus Petroleum’s wholly owned subsidiary Simpor Hibiscus will acquire TotalEnergies Brunei’s 37.5% operated interest in the Block B Maharaja Lela/Jamalulam (MLJ) field offshore Brunei.

Other parties involved in Block B, located 85km off the coast of Brunei, are Shell Deepwater Borneo and Brunei Energy Exploration with 35% and 27.5% stakes, respectively.

TotalEnergies chief financial officer Jean-Pierre Sbraire said: “This transaction fits with our strategy to actively manage our portfolio by monetising mature assets and to allocate our talents to the most promising assets.”

The Maharaja Lela/Jamalulam offshore field was discovered in 1989 and has been producing gas and condensate since 1999. It has production rights of up to 15 years, expiring on 23 November 2039.

Through the acquisition, Hibiscus Petroleum aims to add a net of up to 21.7 million barrels of oil equivalent (MMboe) to its 2P reserves. This showcases an increase of 36% from 60.9MMboe to 82.6MMboe as of 1 January 2024.

The company’s total daily net production of oil, condensate and gas is expected to increase by approximately 7,865boe per day from 21,398boe per day to 29,263boe per day in CY2024.

According to Hibiscus Petroleum, the deal will bring the gas production share of the company’s portfolio to almost 50%.

Besides, the transaction will also contribute towards fulfilling the Malaysian company’s goal of becoming a net zero emissions producer by 2050.

Hibiscus Petroleum managing director Kenneth Pereira, said: “The additional volumes from this transaction are material for Hibiscus Petroleum and will provide an uplift of nearly 86% to our gas production whilst bringing us closer towards achieving our 2026 Mission of growing the Group’s net production to 35,000 – 50,000 boe per day.”

The transaction is expected to be completed in Q4 this year, subject to Hibiscus Petroleum’s shareholders’ approval.