* Norway's Statoil already sold 10 pct stake to BP, SOCAR
* Turkey's Botas in talks to take on Total's stake
* Lower Russian gas price makes new gas investments
* Total to focus its Azeri business on the Absheron gas
By Henning Gloystein and Oleg Vukmanovic
LONDON, Feb 28 France's Total plans to
sell its 10 percent stake in Azerbaijan's Shah Deniz II gas
field, sources with knowledge of the matter said, the second
major to cut exposure to a project aimed to provide an
alternative to Russian gas in Europe.
"Total's strategy is to divest from projects where it has a
minority stake and favour those where it is the operator," one
of the sources said on Friday.
A spokesman for Total declined to comment.
A representative of Turkish state pipeline firm Botas
confirmed it was in talks to buy Total's sake in the project.
Botas is developing the pipeline section to pump Azeri gas into
Turkey and onward towards the European Union.
"The acquisition of a 10 percent stake from Total is
commercially profitable," the representative said.
Analysts said Total's move was probably a result of lower
Russian gas prices, which made investment in expensive new gas
sources less attractive.
Russia's Gazprom has granted price reductions and
repayments to customers across Europe, including Germany's RWE
and E.ON, Italy's ENI and Edison
as well as and France's GDF Suez, in order to
make its gas more attractive against rising competition.
At the same time, European gas demand has been weak due to
the region's slow economic growth and to competition from
cheaper coal in the power generation sector.
"Facing weak demand and high (Russian) supply, prices have
gone down 15 percent in the last two months. This will make
alternative supplies more difficult to arrange when hub prices
are below 60 pence per therm," said Thierry Bros, senior gas
analyst at French bank Societe General.
TOTAL FOLLOWS STATOIL
Total would be following Norway's Statoil, which
cut its stake in the project from 25.5 percent to 15.5 percent
last December in a sale to Azeri state energy firm SOCAR and BP
, the project's technical operator, for $1.45 billion.
From around 2019, the estimated $28 billion Shah Deniz II
project plans to supply 16 bcm of gas per year, with 10 bcm
earmarked for Europe and 6 bcm for Turkey.
The sources said Total's withdrawal from the Shah Deniz
project would come as no surprise because the French major aims
to focus its Azeri efforts on the Absheron gas field, in which
it owns a 40 percent stake. Exploratory drilling found 150-300
billion cubic metres (bcm) of gas resources, and the find was
declared commercial in 2012.
Total has taken a more active approach to managing its
business in recent years, buying and selling assets more
frequently and focusing on projects for which it can be the
The group had sold $13 billion worth of assets by the end of
2013 under a programme to sell $15-$20 billion total between
2012 and 2014, a target it hopes to beat this year.