French giant Total will launch 10 upstream projects in the next 18 months, as the company targets a US$3.5 billion costs savings for the year.
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Image of Total CEO Pouyanné, from Total. |
In 2017, Total is anticipating its production to grow by more than 4%, and an average growth rate of 5% per year from its 2014-2020 forecast.
“As a result of this growth, the sensitivity of the portfolio to Brent increases to $2.5 billion for a $10/bbl change in Brent in 2017. The group plans to take advantage of the favorable cost environment by launching around 10 projects over the next 18 months and adding attractive resources to the portfolio,” Total said in its Q4 2016 report.
Projects scheduled to come onstream in 2017-2018 include: Moho Nord, off the Congolese coast (54%); Libra Pioneiro, offshore Brazil (20%); Edradour-Glenlivet, off the UK (60%); Yamal LNG in Russia (20%); Ichthys LNG, off Australia (30%); Kaombo North, off Angola (30%); Martin Linge, off Norway (51%); Kaombo South, off Angola (30%); and Egina, off Nigeria (24%).
The French major will also start up onshore projects.
Total also said it will continue to cut costs with the objective of achieving $3.5 billion of cost savings in 2017, and bringing its production costs down to $5.5/boe for the year.
In addition, Total said that its investments are moving into the sustainable range needed to deliver profitable future growth, and are expected to be between $16 and $17 billion in 2017, including resource acquisitions.
“After falling from $100/bbl in 2014 to $52/bbl on average in 2015, Brent prices were highly volatile in 2016, fluctuating between $27 and $58/bbl, with an average $44 for the year,” Total Chairman and CEO Patrick Pouyanné said. “In this difficult environment, the group demonstrated its resilience by generating adjusted net income of $8.3 billion and had the highest profitability among the majors due to the strength of its integrated model and commitment of its teams to reduce the breakeven.”
Total's $10 billion asset sale program, which has included the 15% stake in Gina Krog off Norway, is about 80% complete.
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