Denmark is quickly getting out of the oil business and jumping into the wind power industry. The country’s biggest industrial and shipping conglomerate, A.P. Moller-Maersk, has sold off their oil and gas division to a French company called Total. While they’ll still be receiving some profits from oil being harvested in the homeland, that money will be going toward improving the renewable energy infrastructure.
The $7.45 billion deal between Maersk and Total still needs to be finalized, but it’s expected to be approved and closed at some point next year. 67 percent of that amount will be shares of Total’s company. According to Bloomberg, these are three separate divestments -- drilling, tankers, and the supply service unit -- that were formerly combined into one section. Adding together how much each segment will generate in revenue made up the multi-billion dollar deal.
Total, the French company, is considered one of the seven biggest oil companies in the world. They’ll still be harvesting oil from the North Sea, and some revenue from that is going to Maersk. Patrick Pouyanne, CEO of Total, said in a statement that the purchase will provide job opportunities as they continue to push oil and gas production:
“With Maersk Oil’s technical and operating competencies and Total’s experience and strong financial position, we have an exceptional opportunity to boost the combined competitive position in several core upstream regions and deliver growth, value creation and career opportunities.”
What the Danish company is doing is separating themselves from oil-related activities and will be using that revenue to continuing building renewable energy sources. Maersk CEO Soren Skou believes this alternative is better than simply abandoning the oil fields based on his statement in the press release.
“In determining the best future ownership structure for Maersk Oil, it has been imperative for us that the capabilities and assets created in Maersk Oil continue to be developed, and that long-term investments are upheld, especially in the Danish part of the North Sea.”
Denmark, along with other Scandinavian countries, are moving rapidly toward renewable sources. Norway will soon have the largest data center in the world created by Kolos and HDR, and all of it will be fueled by renewable energy. A hydropower plant next to it will have the capacity to produce a gigawatt of power, and it will also help that the environment the data center is located at will be extremely cool to help with manufactured heat.
Danish utility company Dong Energy has become the biggest company involved with offshore wind development and is working all over Europe and the United States to install these projects. In similar fashion, they’ve sold their oil and gas segment to a German corporation for $1.3 billion.
While Maersk is separating itself from oil-related activities, they’re still benefitting from the area they’re in and that profit will be used toward renewable energy. Around one gigawatt annually will come from the revenue they receive from this new deal. By 2050, Denmark is hoping that they will be completely out of the fossil fuel industry.
More from Green Matters
More From Green Matters
This study found that it's raining plastic — here's why.
Conservationists Criticize U.S. Rollbacks to Endangered Species Act — Here's Everything You Need to Know
The Trump administration made some controversial changes.
Here's what we need to do.