A consortium led by Italian gas network company Snam and including the GIC fund and France's EDF has signed an agreement with Total to buy its TIGF networks and storage business in southwest France, the consortium said in a joint statement Friday.
TIGF operates 5,000 km (3,100 miles) of major pipelines in southwest France, as well as storage sites with a working capacity of 2.6 billion cubic meters.
TIGF has been valued at around Eur2 billion-3 billion ($2.6 billion-3.9 billion) and Total is selling the company as part of a $15 billion-20 billion asset sale program.
The consortium, which is 45% held by Snam, 35% held by Singaporean sovereign fund GIC and 20% held by EDF, entered into exclusive negotiations with Total in early February.
The consortium's new acquisition agreement follows a consultation process with TIGF's employee representative bodies.
France's energy sector continues to be significantly regulated, and there has been much opposition to the sale of TIGF.
A four-day strike was called by unions last September, which ceased all withdrawals or injections into TIGF's storage sites and significantly reduced cross-border capacity with Spain.
EDF is the dominant electricity company in France and is 85% owned by the state.
The company is looking to expand in Europe's gas market and its inclusion in a bid was seen as a way of allaying some fears over job losses at the company.
Last year, EDF gained control of Italian energy firm Edison, making it the second-largest gas operator in Italy.
EDF intends to use Edison as its platform to expand gas activities and is also involved in several European salt cavern storage projects as well as building the Dunkirk LNG terminal in northern France.
The closing of the transaction remains subject to approvals by the relevant regulatory and antitrust authorities.
