RoydadNaft –  TotalEnergies has agreed to sell an indirect interest of approximately 10% in Malaysia’s offshore Block SK408 to Thailand’s state-backed PTTEP for an undisclosed sum, the French energy major announced on Tuesday.

Following the transaction, TotalEnergies will retain a 30.002% operating interest in the block, which includes the Jerun gas field that supplies natural gas to Malaysia’s Bintulu LNG complex. The complex, operated by state-owned Petronas, has an annual capacity of 29.3 million metric tons.

The deal marks another step in TotalEnergies’ portfolio optimization in Malaysia, following its acquisition of SapuraOMV Upstream last year in transactions totaling $1.6 billion to expand its natural gas presence. Amid pressure from investors to reduce debt, the company has been divesting mature assets and minority stakes.

“This transaction allows TotalEnergies to efficiently manage its portfolio in Malaysia while strengthening ties with PTTEP, a longstanding partner,” said Nicolas Terraz, President of Exploration & Production at TotalEnergies.

The two companies have a history of collaboration: In 2023, TotalEnergies sold PTTEP a 25% stake in the Seagreen offshore wind farm in Scotland for $661 million and entered a partnership to pursue joint upstream opportunities.

Block SK408 is jointly held by Petronas subsidiaries (30%) and Shell (30%), with TotalEnergies as operator.

Malaysia was the world’s fifth-largest LNG exporter in 2023, exporting nearly 28 million tons mainly to Japan, China, and South Korea, according to Kpler data. Thailand is Southeast Asia’s largest LNG importer.

In a separate development, TotalEnergies recently signed a 21-year agreement to supply solar power to Google-operated data centers in Malaysia.