Weak Market Hits Total in Q1

Substantially lower Asian and European spot gas prices, and lower Brent crude, took the shine off Total's Q1 results, published April 26. The French company's output – split overall marginally in favour of gas – was up 9% at 2.95mn barrels of oil equivalent/day, and the company made two big finds – Brulpadda ('Bullfrog') off South Africa and Glengorm in the UK – and is partner in a third.

And with new fields on line, chiefly the liquids-rich Ichthys field off Australia, Angola's Kaombo South and Nigeria's Egina, cashflow was up 15% to $6.5bn, and return on equity was unchanged at 12%. CEO Patrick Pouyanne said operational performance had been good and spending discipline had been maintained.

But upstream's adjusted net income was $1.722bn, down 5% on the same period in 2018 and that sector's adjusted net income was down 4% at $2.8bn. The average Brent price was down 6%.

Split out separately for the first time, the Integrated Gas & Power sector sold more LNG thanks in part to the liquids-rich Ichthys field and the ramp-up of Yamal LNG trains in Russia. The Engie LNG division purchase will allow the group to manage an overall volume of around 40mn mt/year by 2020.

That will rise when Papua LNG and Arctic LNG-2 are operational and rise further if the Tellurian-operated Driftwood LNG terminal goes ahead. Total invested in both the latter projects this year and signed the gas agreement for the first to enable the launch of the engineering phase.

In Q1 it sold 3.2mn mt of equity production, up 52% on last year and 7.8mn mt in total, or double Q1 2018 sales; but weak spot prices – down 30% in Asia and 11% in Europe – hit the bottom line. Adjusted net operating income for IGP was $592mn, up 23% notionally on Q1 2018.