TotalEnergies, Equinor Growth Tied to Eagle Ford, Marcellus M&A

Equinor’s North Henderson Unit 1H operates in the Marcellus Shale in Ohio. Equinor grew its non-op Marcellus portfolio last year with two transactions with EQT Corp. Norway’s Equinor and French energy firm TotalEnergies added U.S. shale gas exposure through M&A last year. (Source: Ole Jørgen Bratland/Equinor)

Chris

Mathews

Hart Energy

Thu, 05/01/2025 - 02:27 PM

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Non-operated U.S. gas assets barely get a mention in earnings for TotalEnergies and Equinor ASA.

But TotalEnergies’ Eagle Ford Shale portfolio and Equinor’s Marcellus Shale portfolio—both non-op—are key production drivers for the two European energy firms.

Both companies were active in U.S. shale M&A last year. Equinor grew its non-op Marcellus portfolio through two transactions with EQT Corp.

The first deal in April included EQT’s 40% non-op stake in northeast Pennsylvania and around 225 MMcf/d of net production.

In exchange, Equinor paid $500 million to EQT and divested its operated Marcellus and Utica assets—around 36,000 acres in Pennsylvania and Ohio, adjacent to EQT’s existing footprint.

EQT later sold Equinor the remaining 60% non-op package—around 350 MMcf/d of net production—for $1.25 billion.

It was an opportune time to buy: Natural gas prices were “quite a bit lower” when Stavanger, Norway-based Equinor made the acquisitions than where they are today, said President and CEO Anders Opedal.

“We do believe in natural gas in the long term, both in Europe and also elsewhere,” Opedal said April 30 during Equinor’s first-quarter earnings call.

The two deals increased Equinor’s U.S. production by 80,000 boe/d in the first quarter.

Equinor avoids hedging and tries to capture spot market volatility with its gas volumes. The company realized an average North American gas price of $4.06/MMBtu—about 11% more than the average $3.65 Henry Hub price, Opedal said.

“What we have seen in the Northeast are periods of cold spells and very high natural gas prices,” he said. “The way we market and trade, we will be able to capture that.”

Opedal declined to comment on Equinor’s appetite for future U.S. onshore M&A.

Shale gas is a relative bright spot in Equinor’s U.S. asset portfolio. The company said it’s also considering legal options after the U.S. government ordered work to halt on its 810-megawatt Empire Wind project offshore New York.

TotalEnergies’ taps Texas gas

U.S. shale plays an important and growing role in Paris-based TotalEnergies’ global gas strategy.

TotalEnergies acquired a 45% non-op stake in Eagle Ford dry gas assets from Lewis Energy Group last year. Production from the acquired assets could reach 400 MMcf/d by 2028.

Earlier in 2024, TotalEnergies purchased a 20% non-op interest in the Eagle Ford’s Dorado gas field from Lewis. EOG Resources is the operator and holds the other 80% stake.

The Dorado deal boosted TotalEnergies’ U.S. gas output by 50 MMcf/d, with the ability to ramp to 100 MMcf/d by 2028.

TotalEnergies’ Eagle Ford operators, EOG and Lewis, are increasingly tapping the Austin Chalk for gas output growth, Railroad Commission of Texas (RRC) data show. The Austin Chalk overlies the deeper Eagle Ford Shale.

TotalEnergies’ first-quarter output averaged 2.56 MMboe/d, up 4% year over year, the French supermajor reported April 30.

The new Eagle Ford gas interests were cited as a growth driver, in addition to offshore project startups and the acquisition of SapuraOMV’s upstream assets offshore Malaysia.

TotalEnergies also remains one of the largest gas producers in the historic Barnett Shale near Fort Worth, Texas.

The company operates technical production of around 500 MMcf/d in the Barnett, according to investor filings.

TotalEnergies is the second largest Barnett gas producer behind BKV Corp., which went public through an IPO last fall.

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Chris Mathews

Chris is the Senior Reporter of Shale and A&D at Hart Energy. He covers the North American upstream shale energy industry and the acquisition and divestiture deal markets.