French Energy giant, Total SA, has opted out of its deal with Occidental Petroleum to purchase Anadarko assets in Ghana. This comes after a collapse in a proposal to buy Algerian assets by the company earlier this month. The company cited low oil prices as one of its major reasons for backing out of the deal.

In August 2019, Total and U.S company Occidental agreed that Total would purchase Anadarko’s assets in Africa. The acquisition and transfer of assets in South Africa and Mozambique have been completed since then, but the completion of the deal, concerning the other two countries, fell through.

This is a major setback for Occidental, which intended to use the money generated from these sales to reduce its debt, and pay investors who funded its $37 billion Anadarko Petroleum buyout in August 2019. The projects in Algeria and Ghana were supposed to raise about $5billion for Occidental which is to begin repayment of its debt next year.

Both companies have also agreed to execute a waiver that allows Occidental to begin to look for other buyers for the Ghana assets, even though their sale agreement expires in September. A statement by Occidental said, “These assets in Ghana are world-class and function economically well at low prices with upside potential over the long term.”

The Chief Executive Officer of Total had stated earlier this month after the Algeria deal was unsuccessful, that it would continue to pursue the Ghana purchase even though it had “less appetite” for it. In a statement on Monday, 18th May 2020, the CEO stated that the decision to finally back out of the Ghana purchase reflected “the extraordinary market environment and the lack of visibility that the group faces,” as well as the “non-operated nature of the interests.”

Total looks to have backed out of the deal to make acquisitions elsewhere. In February this year, it made a successful entry into Spain’s solar market, with the acquisition of a portfolio of almost 2 gigawatts of renewable-power projects.

In a separate statement on Monday, Total announced that it had further cemented its place in the Spanish energy market by acquiring 2.5 million customers from Energias de Portugal SA, as well as two gas-fired plants. This will see the company become the fourth-largest supplier of gas and power in the country, based on an enterprise value of $558 million (€515 million).