Total’s board of directors has appointed a new CEO, following the death of its chairman and CEO Christophe de Margerie (pictured right) in a plane crash in Moscow late on Monday night.
Patrick Pouyanné, Total’s President of Refining & Chemicals, was selected by Total’s board in Paris today (22 October) to be the company’s new CEO and President. The board of dircetors also appointed a new chairman, Thierry Desmarest.
Today, Total’s board also paid homage to its former chairman and CEO, describing him as an “exceptional human.”
“He dedicated his brilliant career to the development of the group, enabling its glowing success in the oil and gas sector and more recently in solar energy,” Total said in a statement. “The exceptional human and professional qualities that Christophe de Margerie exhibited during his time at Total were largely responsible for the success of the Group.”
The new leadership at Total comes at a time when the global industry is facing cut backs in capital spending. De Margerie, who had worked at Total since 1974, and had been its CEO since 2007, has recently been discussing the need for capital discipline.
At the firm’s investor day last month, Total said its production should grow to about 2.8MMboe/d in 2017, as 15 major projects start-up in the period from now. But, the firm said strict capital discipline will also be key. The firm will be selling an additional US$10 billion of assets in 2015-17, on top of $15-20 billion due to have been sold off in 2012-14.
Organic investment, which reached a peak of $28 billion in 2013, was projected to decrease to $26 billion in 2014 and to $25 billion in 2017. The group also announced a major program to reduce operating costs by $2 billion/yr by 2017, with an immediate impact as of 2015, without compromising a priority to safety.
Total is the fourth-largest of the Western multinational oil majors by market capitalization, after Exxon, Royal Dutch Shell and Chevron, and the second-largest company in France.
Under de Margerie's reign, reserves-life, or the number of years of current production that could be replicated using existing reserves, rose in every year but one, the longest such streak for Total since at least 1998, according to Bloomberg.
Total was reevaluating plans to explore for shale oil in Western Siberia with partner OAO Lukoil amid economic sanctions against Russia, the company said last month.
Image: Patrick Pouyanné. Photo from Total.
De Margerie's career spans 40 years, starting in Total's finance unit. He joined Total in 1974 and later rose to CEO in 2007, and chairman in 2010. Earlier this year, de Margerie – nicknamed "Big Mustache", due to his facial hair – helped negotiate the Paris-based company's entry into Russian shale under a Siberian drilling venture with OAO Lukoil. The company is also a partner in the vast Russian gas development on the Yamal Peninsula.
Until today, Pouyanné was President of Refining & Chemicals and a member of the Executive Committee. Pouyanné is a graduate of École Polytechnique and an Engineer of the French Corps des Mines. From 1989 to 1996, he held various positions in the French Industry Ministry and in ministerial offices, including Environment and Industry Technical Advisor to the Prime Minister from 1993 to 1995 and Chief of Staff to the Information Technology and Space Minister from 1995 to 1996. He joined Total in January 1997, as Chief Administrative Officer of Total E&P Angola and became Group Representative in Qatar and CEO of Total E&P Qatar in 1999.
In August 2002, he was named Senior Vice President, Finance, Economics and Information Systems in Exploration & Production. In January 2006, he became Senior Vice President, Strategy, Business Development and R&D in Exploration & Production. Patrick Pouyanné has been a member of Total’s Management Committee since May 2006.
In March 2011, he was appointed Senior Vice President, Chemicals and Senior Vice President, Petrochemicals. In January 2012, Patrick Pouyanné was appointed President, Refining & Chemicals and member of the Executive Committee.
Image: Thierry Desmarest. Photo from Total.
Thierry Desmarest is a graduate of the École Polytechnique and an Engineer of the French Corps des Mines, Desmarest served as Director of Mines and Geology in New Caledonia, then as technical advisor at the Offices of the Minister of Industry and the Minister of Economy. He joined TOTAL in 1981, where he held various management positions, then served as President of Exploration & Production until 1995. He served as Chairman and Chief Executive Officer of Total from May 1995 until February 2007, and then as Chairman of the Board of Total until May 21, 2010. He was appointed Honorary Chairman and remains a director of Total and Chairman of the Total Foundation.
Desmarest’s role as chairman of the board of directors will conclude at the end of 2015 in accordance with the age limits stipulated in Total’s bylaws. The positions of chairman of the board of directors and Chief Executive Officer will then be recombined.
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