Talos Energy has sold its carbon capture and storage business to TotalEnergies for about $148 million and says it doubled its money. TotalEnergies gets three Gulf Coast storage projects. It has already said it plans to sell two of them. That leaves a question about what the price was really for.
Key takeaways
- TotalEnergies announced on 18 March 2024 that it had acquired Talos Low Carbon Solutions (TLCS), the carbon capture and storage business of Talos Energy, for about $148 million, made up of $125 million plus customary reimbursements, adjustments and retained cash.
- Talos Low Carbon Solutions holds three carbon storage projects in Texas and Louisiana: a 25 percent share of Bayou Bend in Texas alongside Chevron (50 percent, operator) and Equinor (25 percent), plus interests in Harvest Bend in Louisiana and Coastal Bend in Texas.
- Through the TLCS acquisition TotalEnergies holds a 65 percent operated interest in Harvest Bend and a 50 percent interest in Coastal Bend, and it intends to divest its interests in both projects after closing.
- Talos Energy said the sale of TLCS was monetised at about two times its invested capital and an internal rate of return above 100 percent, with further contingent payments due on a final investment decision or later sales at Harvest Bend and Coastal Bend.
- Morgan Stanley acted as financial adviser, Latham & Watkins as legal adviser and ARC Advisory Group as technical adviser to Talos Energy on the TLCS sale; Talos will use the proceeds to repay borrowings under its credit facility.
What did TotalEnergies actually buy for $148 million?
It bought one shared interest in a large storage site and two other positions it does not intend to keep. Carbon capture and storage, or CCS, means capturing carbon dioxide from industrial plants and injecting it into deep rock formations for permanent storage. The value of a CCS business sits mostly in its storage rights, because good geology near large emitters is scarce and slow to permit.
Bayou Bend is the asset that fits that description. It covers licences dedicated to carbon dioxide storage both offshore and onshore, spanning about 600 square kilometres. Leap describes it as having the potential to store several hundred million tons of carbon dioxide because of its location, size and geology. Its intended customers are industrial emitters around the Houston Ship Channel and the Beaumont and Port Arthur region.
TLCS owned a quarter of it. Chevron holds half and operates the project, and Equinor holds the other quarter. So TotalEnergies has joined a three-way partnership of large energy companies rather than taking control of a site.
The transaction had an effective date of 1 January 2024 and closed on the day it was announced. Leap's structured record leaves the deal value undisclosed, while its narrative cites the $148 million total and the $125 million base price.
Why does TotalEnergies plan to sell two of the three projects?
Because the stated intention points to Bayou Bend as the asset it wanted, with Harvest Bend and Coastal Bend coming as part of the package. TotalEnergies takes a 65 percent operated interest in Harvest Bend in Louisiana and a 50 percent interest in Coastal Bend in Texas. Coastal Bend was developed jointly by Talos Energy and Howard Energy Partners. TotalEnergies said it intends to divest both after closing.
The contingent payment terms fit that reading. Talos keeps a right to further payments if either project reaches a final investment decision or is sold on. Leaving Talos exposed to the upside on those two projects likely reduced the cash TotalEnergies had to pay upfront, and it suggests neither side thought the two projects could be priced with confidence on the day.
For Talos the logic is simpler. The company wanted to focus on cash generation in its core upstream oil and gas business and to cut debt. A business it built early returned about twice its invested capital, and the cash went straight to the credit facility.
How does the price compare with Chevron's entry into Bayou Bend?
It is far higher than Bayou Bend alone would justify on Chevron's 2022 terms, which suggests the value of the site rose quickly. In May 2022 Chevron agreed to buy 50 percent of Bayou Bend from Talos Energy and Carbonvert, and Leap records that deal at $50 million. Grossed up to the whole project, that implies about $100 million for 100 percent of Bayou Bend in 2022. On the same terms, a 25 percent interest would have been worth about $25 million.
TotalEnergies paid a $125 million base price for that 25 percent plus the two other projects, less than two years later. Either the two smaller projects carry most of the value, which sits awkwardly with the plan to sell them, or Bayou Bend was worth considerably more in 2024 than in 2022. Equinor's purchase of Carbonvert's 25 percent in August 2023, traced in the Bayou Bend timeline, would settle the question, but its price was not disclosed.
Enerdatics records 63 carbon capture and storage transactions in the United States between January 2022 and June 2025. Forty-two are joint ventures or partnerships, 12 are corporate deals and nine are asset deals. Only 11 carry a structured deal value, together worth $3,889.8 million, and the TLCS sale is not one of them even though the seller published its price. The largest priced deal is the $1,800 million business combination between AMCI Acquisition Corp. II and LanzaTech in 2022.
What does the sale signal for US carbon storage?
It signals consolidation of Gulf Coast storage rights into the hands of large energy companies. The founding partners of Bayou Bend were an upstream oil producer and a specialist carbon storage developer. Within three years both had sold, and the project passed entirely to Chevron, Equinor and TotalEnergies. Most US CCS activity in the Enerdatics record is still partnership work with no money disclosed. Where money does change hands, the buyers in this case are majors taking positions that early movers assembled.
The same pattern appears in carbon removal, where Occidental bought Carbon Engineering for $1.1 billion after years of collaboration. The open question for TotalEnergies is what Harvest Bend and Coastal Bend fetch when it sells them, and whether those sales trigger the contingent payments Talos is still waiting for.
Frequently asked questions
How much did TotalEnergies pay for Talos Low Carbon Solutions? About $148 million, made up of a $125 million purchase price plus customary reimbursements, adjustments and retained cash. Further contingent payments may follow if Harvest Bend or Coastal Bend reaches a final investment decision or is sold.
Who owns the Bayou Bend CCS project? Chevron holds 50 percent and operates the project. Equinor and TotalEnergies each hold 25 percent, TotalEnergies through its purchase of Talos Low Carbon Solutions.
Why did Talos Energy sell its carbon storage business? Talos said the sale lets it focus on cash generation and capital allocation in its core upstream business. It used the proceeds to repay borrowings under its credit facility and reported about two times its invested capital on TLCS.
Ready to get deal-ready answers in seconds? Try Enerdatics Leap AI and access verified intelligence across M&A, financings, PPAs, projects, and energy market developments through natural language.
.jpeg)
