- Total (TOT +2.5%) will continue to cut capital spending and operating costs while raising production, CEO Patrick Pouyanné tells investors.
- Pouyanné says TOT plans to cut its investment to $15B-$17B in 2017, down from an expected $18B-$19B this year, and sets up a target to cut costs by more than $4B in 2018, up from more than $2.4B expected this year and more than $3B targeted in 2017.
- Despite increased cost-savings and lower investment, the CEO says TOT will lift output by 5%/year until 2020 and by 1%-2% annually thereafter, as it counts mainly on the projects it has invested in before oil prices collapsed and it started cutting on investment.
- The announcement, while not a surprise, will raise investor interest in TOT, which has not performed significantly better than peers despite its operational outperformance, Macquarie says.