Total To Cut Capex Further

Total CEO Patrick Pouyanne has revised the company's guidance in a September 22 presentation to equity analysts in London.

He said Total aimed to delivering growth with capital expenditure of $15bn to $17bn per year from 2017, $2bn/yr less than its previous guidance due to further capex discipline and cost deflation.

Total would also increase savings from operational expenditure (opex) to $4bn from 2018, from $3bn, and grow production at an average of 5%/yr in 2014-2020, rather than out just to 2019.

Total chairman and CEO Patrick Pouyanne (Photo credit: Total)

Pouyanne said that expanding Total’s activities along the “full gas value chain” would be one of five priorities for its medium-term growth – the others being lowering the breakeven of its oil portfolio both up- and downstream, expanding in marketing, positioning itself in low-carbon businesses, and becoming the most profitable European integrated major.

Earlier this week, analysts Wood Mackenzie reported how significantly oil majors have high-graded their exploration portfolios and reduced their budgets, during the oil price downturn since 2015, adding that they were becoming leaner, more efficient, and gassier. 

Mark Smedley