In what could be the beginning of a wave of Big Oil tie-ups, Total SA agreed Monday to pay an estimated $7.45 billion, including debt, to buy the exploration arm of shipping giant A.P. Moller-Maersk.

Exploration and production (E&P) companies have hinted in recent quarterly conference calls that they are more inclined — and more able following the oil price debacle — to buy relatively cheap assets. Up to now, small purchases have been the order of the day for producers, with the big dealmaking concentrated in the oilfield services (OFS) sector.

Buying Maersk Oil & Gas A/S would enhance Total’s opportunity set, said CEO Patrick Pouyanne. He hinted during the 2Q2017 conference call last month that the company was ready to “take advantage of the low-cost environment” to seek acquisitions.

“This transaction delivers an exceptional opportunity for Total to acquire, via an equity transaction, a company with high quality assets which are an excellent fit with many of Total’s core regions,” Pouyanne said Monday. “The combination of Maersk Oil’s northwestern Europe businesses with our existing portfolio will position Total as the second operator in the North Sea with strong production profiles in UK, Norway and Denmark,” increasing exposure to conventional assets in developed countries.

“Internationally, in the U.S. Gulf of Mexico (GOM), Algeria, East Africa, Kazakhstan and Angola there is an excellent fit between Total and Maersk Oil’s businesses allowing for value accretion through commercial, operating and financial synergies.”

The Maersk deal would increase Total’s overall production by 160,000 boe/d in 2018. It also would strengthen core Total regional businesses, including in the U.S. GOM, where Total has a one-third stake in the Chinook field and a 17% interest in the Tahiti field. It also is involved in an exploration campaign that led to a discovery on North Platte, in which it has a 40% interest

In late 2009 Maersk Oil made its mark in the GOM after agreeing to pay $1.3 billion to buy Devon Energy Corp.’s GOM deepwater portfolio. The transaction, which included up to $4 billion in additional investments over time, was focused on prospects in the Lower Tertiary Trend, including Devon’s half-interest in the Cascade facility and its 25% stake in Chevron Corp.’s Jack and St. Malo projects. All of the developments are in the Walker Ridge blocks offshore Louisiana.

Total also works in the U.S. onshore, as a producer in the Barnett Shaleand elsewhere, and it trades natural gas and natural gas liquids (NGL) produced by affiliate Total E&P USA and nonaffiliated producers. Total also markets petroleum coke produced by the Port Arthur, TX, refinery, and NGLs extracted from the Utica Shale.

In addition, Total has reserved liquefied natural gas (LNG) regasification capacity at the Sabine Pass terminal in Louisiana. In addition, it has a 23% interest in Tellurian Investments Inc. to develop an integrated gas project at the Driftwood LNG terminal in Texas.

The combination with Maersk Oil would provide Total with around 1 billion boe of proved and probable (2P) and contingent (2C) reserves, 85% of which are in developed nations that are members of the OECD, i.e. the Organisation for Economic Co-Operation and Development. More than 80% of the reserves are in the North Sea.

Under the agreed terms, A.P. Moller-Maersk would receive $4.95 billion in Total shares (about 97.5 million, or 3.75%), and Total would assume $2.5 billion of Maersk Oil’s debt. Total also has offered the possibility of a seat on its board to A.P. Moller Holding A/S, the main shareholder.

The proposed transaction is set to be completed in early 2018.

Total expects to generate operational, commercial and financial synergies of more than $400 million/year with the transaction. It plans to add an anchor point in Denmark to host its North Sea business unit and supervise operations in Denmark, Norway and the Netherlands.

The transaction, said Pouyanne, “is in line with our announced strategy to take advantage of the current market conditions and of our stronger balance sheet to add new resources at attractive conditions…This transaction will deepen and accelerate this strategy significantly, as Total will become a 3 million boe/d major by 2019 to the benefit of all Total shareholders.”