Total SA Warns of Rising Costs and Need for Project Revisions

France’s Total warned peers of escalating costs, calling on them to revise some projects. 

“Costs are becoming too high. Projects of $50 billion leave one thinking ‘Isn’t it crazy?’” Christophe de Margerie, chief executive officer of the Paris-based company, told Bloomberg on Friday.

Budgets are rising fast also in the United Kingdom. Chevron ditched its £6 billion Rosebank project west of Shetland, while Statoil postponed a final investment decision on Bressay heavy oilfield in the North Sea.

“We have to redefine how we can develop some fields without spending as much money. It probably means reinventing, going back to the architecture of projects,” De Margerie explained in the sidelines of the World Economic Forum in Davos.