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SNR Denton, Vinson Advise on Total's $2.5 Billion Sale to Sinopec
The Am Law Daily
Vinson & Elkins and SNR Denton have taken lead roles on French energy giant Total's $2.5 billion sale of a 20 percent stake in an offshore Nigerian oil field to the China Petroleum & Chemical Corp., better known as Sinopec.
SNR Denton is advising on the Total side of the deal, working with an in-house legal team led by Total group general counsel Peter Herbel; Marc-Olivier Nicolas, who is with a related holding company; and Marie-Joelle Lanista, who is with Total's exploration and production division.
An SNR Denton spokeswoman declined to comment on the names of the firm lawyers advising Total on the sale to Sinopec.
The transaction -- the latest in a series of outbound M&A deals involving Chinese energy companies -- is the first major deal for SNR Denton since it unveiled its plans to build the world's largest energy practice via a three-way combination announced earlier this month with Canada's Fraser Milner Casgrain and Paris-based Salans, according to our previous reports.
London-based legal giant Norton Rose moved quickly to challenge that move to claim energy dominance by announcing its own tie-up with Fulbright & Jaworski, the Houston-based Am Law 100 firm known for its energy and oil and gas practices. If approved, the combination would result in the creation of Norton Rose Fulbright, a 3,800-lawyer global firm with a focus on emerging markets for energy and other natural resources.
As it happens, both Norton Rose and Fulbright have handled past assignments for Total, which is based in a massive skyscraper in a business district outside Paris. Norton Rose, for instance, took the lead advising Total on its investment in a $1.44 billion liquefied natural gas terminal project in France last year, while Fulbright advised the company earlier this year on its $2.32 billion acquisition of a stake in U.S. shale assets held by Chesapeake Energy.
Vinson, like Fulbright, is an Am Law 100 firm with Texas roots and energy expertise. And Beijing-based Sinopec, one of the world's largest companies by revenue, is a longtime Vinson client.
The firm advised Sinopec earlier this year on an $8.5 billion joint venture with Saudi Aramco aimed at building a new refinery in the western Saudi Arabian city of Yanbu. Vinson also took the lead for Sinopec last year on its $5.2 billion purchase of Brazilian assets held by Portuguese oil and gas company Galp Energia, as well as the $2.1 billion acquisition of Canada's Daylight Energy. In 2010 the firm advised Sinopec on its $7.1 billion purchase of a 40 percent stake in the Brazilian unit of Spanish oil and gas company Repsol, as well as the company's $2.45 billion buy of Argentine oil and gas assets held by Occidental Petroleum.
China-based Vinson energy projects M&A partners David Blumental, Paul Deemer and Xiao Yong were named Dealmakers of the Year by The American Lawyer in 2010 for their work representing Sinopec in 2009 on its $7.2 billion acquisition of Addax Petroleum, which at the time was the largest-ever purchase of a foreign company by a Chinese buyer.
Sinopec rival The China National Offshore Oil Corp., also known as CNOOC, made a $15.1 billion bid for Canadian oil producer Nexen this summer. The American Lawyer reported in its November issue that the proposed deal marks a change in strategy by CNOOC and its outside lawyers less than a decade after the company failed to close on its $18.5 billion takeover offer for U.S. oil company Unocal. (Chevron later bought Unocal for $17.9 billion.)
Terms of Sinopec's deal with Total call for the Chinese energy giant to take control of the OML 138 block that includes the French company's stake in the Usan offshore oil field, which Total owns jointly with Chevron, Exxon Mobil and Nexen, the Calgary-based company poised to be bought by CNOOC. The sale by Total, which is seeking to sell off $20 billion in assets in order to restructure its operations, requires the approval of Nigerian regulators. The country holds about 28 percent of the oil reserves on the African continent, which, in turn, count for about 8 percent of global supply.
Three Vinson media representatives did not immediately respond to requests for comment on the names of the lead lawyers from the firm advising Sinopec. Shao Jingyang serves as Sinopec's general counsel.
The boom in energy-related transactional work has kept Vinson's lawyers busy lately. The firm advised Denver-based Antero Resources on its announced $325 million sale three weeks ago of natural gas and pipeline assets in Colorado, Summit Midstream Partners on its $207 million acquisition of ETC Canyon Pipeline in October, and private equity giant TPG Capital on the sale that same month of a stake in an Italian cellulosic ethanol joint venture called Beta Renewables to Danish biotech company Novazymes.
In September, Vinson advised Denver-based oil and gas producer Triangle Petroleum on a pipeline development joint venture in North Dakota with private equity firm First Reserve; private equity-owned Sidewinder Drilling on its $242 million purchase of Union Drilling; private equity firm Riverstone Holdings on its $500 million investment partnership with Kaiser Midstream to form Sage Midstream; and private equity giant The Carlyle Group on its agreement to buy power plant developer Cogentrix Energy from Goldman Sachs for an undisclosed sum.