Total S.A.: Is The Business Model Viable?
Richard Zeits • 10 Comments
Richard Zeits • 10 Comments
Wed, Nov. 30, 9:50 AM
- Shares of energy companies surge at the open, as hopes for an OPEC deal to cut production send crude oil futures soaring.
- Reports say Saudi Arabia is prepared to accept "a big hit" to production and agree to Iran freezing output at pre-sanctions levels.
- In early trading: XOM +2.2%, CVX +2.3%, RDS.A +3.6%, BP +3.4%, TOT +1.7%, STO +5.1%, PBR +8.1%, COP +7.2%, MRO +12.1%, APC +8%, DVN +12.7%, HES +9.5%, ENB +2.1%, PSX +0.8%, SLB +4.2%, HAL +8.3%, BHI +4.3%, KMI +4.8%, EPD +2.7%, ETP +3.8%, WMB +5.4%, RIG +11.3%, SE +2.2%, CHK +9.4%.
- ETFs: XLE, VDE, ERX, OIH, XOP, FCG, ERY, GASL, DIG, DUG, BGR, XES, IYE, IEO, FENY, IEZ, PXE, GASX, PXI, FIF, PXJ, RYE, NDP, GUSH, PSCE, DRIP, DDG, FXN, CRAK
Tue, Nov. 29, 10:20 AM
- Crude oil continues to slide - WTI now -3.8% at $45.27/bbl, and Brent -3.8% at $46.40/bbl - dragging oil and gas equities (XLE -2.1%) down with it.
- Iran's oil minister says he is not prepared to reduce supply, and Saudi Arabia says it would not participate in a production deal without Iran and Iraq.
- Reuters reports that Iran has written to OPEC saying Saudi Arabia needs to cut oil output to 9.5M bbl/day; Saudi has said it was prepared to reduce its production only by 500K bbl/day from current levels of 10.5M.
- In early trading: XOM -1%, CVX -1.7%, RDS.A -1.4%, BP -1%, TOT -0.3%, STO -1.8%, PBR -3.7%, COP -2.9%, MRO -4%, APC -2.8%, DVN -2.7%, HES -3.6%, ENB -2.3%, PSX -1.2%, MPC -0.8%, SLB -2.2%, HAL -2.3%, BHI -2.1%, KMI -1.4%, EPD -2%, ETP -2.2%, WMB -2.4%, SE -2.3%, CHK -2.6%.
- ETFs: XLE, VDE, ERX, OIH, XOP, FCG, ERY, GASL, DIG, DUG, BGR, XES, IYE, IEO, FENY, IEZ, PXE, GASX, FIF, PXJ, RYE, NDP, GUSH, DRIP, DDG, FXN, CRAK
Tue, Nov. 29, 8:55 AM
- Chevron (NYSE:CVX) is teaming up with Mexico's Pemex and Japan’s Inpex to bid for the right to explore for oil and natural gas in Mexico's first-ever deepwater auction, set for Dec. 5.
- The auction marks the first time Mexico's state-owned operator will partner with private companies to develop crude in the Gulf of Mexico, and is one of seven groups and eight individual bidders to qualify for participation.
- Total (NYSE:TOT) is joining forces with BP and Statoil (NYSE:STO) in one group, and with ExxonMobil (NYSE:XOM) in another, while Eni (NYSE:E) and Lukoil (OTCPK:LUKOY, OTC:LUKOF) also joined up, and Anadarko Petroleum (NYSE:APC) and Royal Dutch Shell (RDS.A, RDS.B) formed another group; other companies involved include BHP, CEO, MUR.
- The Mexican regulator has not specified which bids are for the Trion field joint venture with Pemex or for the other areas.
Fri, Nov. 25, 9:39 PM
- Total (NYSE:TOT) says it will lead a consortium of companies to build a liquid natural gas import terminal in Ivory Coast meant to feed the country's growing electricity consumption, with a final investment decision on the project expected in Q1 2017.
- The project aims to build and operate a floating storage regasification unit with an initial capacity of 100M cf that would gradually be brought up to 400M cf; the cost of the project, expected to take ~18 months to complete, has been cut to $100M from an earlier estimate of $200M.
- The consortium is 34% owned by TOT, 26% controlled by Azerbaijan's state-owned SOCAR, 13% by Royal Dutch Shell (RDS.A, RDS.B), and 11% by Ivorian state oil company Petroci, with smaller stakes held by Golar LNG (NASDAQ:GLNG) and Endeavor Energy.
Mon, Nov. 21, 7:14 PM
- ExxonMobil (NYSE:XOM) and Chevron (NYSE:CVX) are among the oil majors least prepared for a shift to a greener global economy, according to a report by CDP, a non-profit group that collects company environmental data on behalf of 800-plus institutional investors.
- Only Suncor Energy (NYSE:SU) scores worse in the study of the readiness of big energy companies in transitioning to a low carbon economy and a future in which natural resources such as water become increasingly scarce.
- European companies fare the best: Statoil (NYSE:STO) ranked first, in part because it had the highest share of gas in its stock of proven reserves, Eni (NYSE:E) scored second, thanks to its big gas projects in the pipeline, and Total (NYSE:TOT) was third due to its stakes in SunPower and the Saft batery maker.
- XOM "performs below its peers in its emissions performance and wider climate governance and strategy considerations," according to the report.
Mon, Nov. 21, 10:49 AM
- Total (TOT +2.3%) says it signed an agreement to team with Azerbaijan's state oil company SOCAR in developing the country's Absheron natural gas field.
- TOT, which does not disclose the amount the joint venture would invest in the field, expects the first phase of production ultimately will yield as many as 35K boe/day.
- TOT will operate the field and take a 40% stake, SOCAR also will own a 40% stake, and French power utility Engie (OTCPK:ENGIY) will hold the rest.
Thu, Nov. 17, 11:57 AM
- Nigeria's government says it reached a $5.1B settlement to reimburse foreign oil companies including ExxonMobil (NYSE:XOM), Royal Dutch Shell (RDS.A, RDS.B), Chevron (NYSE:CVX), Total (NYSE:TOT) and Eni (NYSE:E) for operating costs incurred during 2010-15.
- The amount, less than the $6.8B previously discussed, will be settled through crude oil sales over five years and will be interest free, according to the petroleum minister.
- Nigeria still owes the companies $2.6B from operations this year.
Tue, Nov. 15, 10:58 AM
- Kazakhstan's Kashagan oil field produced ~201K tons of oil, or nearly 1.7M barrels, in October, its first full month of operation, finally showing some results after multi-year delays and $55B spent in development.
- The October output figure is the equivalent of 52.6K bbl/day, while Kazakh officials have said that in order to reach commercial output the field needs to achieve stable production of at least 75K bbl/day.
- The consortium developing Kashagan consists of China National Petroleum (NYSE:PTR), ExxonMobil (NYSE:XOM), Eni (NYSE:E), Royal Dutch Shell (RDS.A, RDS.B), Total (NYSE:TOT), Inpex and KazMunaiGas.
Thu, Nov. 10, 5:59 PM
- Angolan state oil company Sonangol and its partners including Chevron (NYSE:CVX) say they have started production at the Mafumeira Sul offshore oil field with an initial output of 10K bbl/day.
- The $5.6B project is using early production systems while it is being fully developed to pump an estimated 110K bbl/day or more, Sonangol says.
- CVX holds a 39.2% interest in Mafumeira Sul while Sonangol has a 41% stake; other partners are Total (NYSE:TOT) and Eni (NYSE:E), with respective 10% and 9.8% holdings.
Wed, Nov. 9, 8:34 AM
- A top exec at French oil and gas company Total (NYSE:TOT) says the Trump election will have no impact on the company's investments in Iran.
- TOT yesterday announced a $4.8B deal to develop an Iranian natural gas field in the Persian Gulf, but WSJ quotes an exec at another unnamed European energy company trying to enter Iran as saying "it's going to be wait-and-see" before making any decision to follow TOT now that Trump has been elected.
- Trump consistently has savaged last year's deal with Iran over the country's nuclear policy that opened the way for western investment.
- TOT -2.3% premarket.
Wed, Nov. 9, 6:58 AM
- European press reaction to Trump's election is broadly positive when it comes to prospects for the oil and gas industry, Rigzone.com reports.
- London's Evening Standard newspaper says oil companies will be riding high and suggests that BP could potentially strengthen ties in the U.S.
- Spanish news service vozpopuli.com says Trump's win could benefit Spain's Repsol (OTCQX:REPYF, OTCQX:REPYY) since it means increased support for traditional energy companies.
- But French business website capital.fr says Trump may seeks to favor U.S. operators at the expense of foreign groups such as Total (NYSE:TOT) and Technip (OTCQX:TNHPF).
- Also, German business weekly WirtschaftsWoche notes Trump likely will pursue a turnaround in U.S. energy and climate policy.
Tue, Nov. 8, 10:23 AM
- Nigeria's government has reached an outline settlement to resolve a dispute with western energy firms that would pay the companies $5B to cover exploration and production joint venture costs in the country, Financial Times reports.
- Nigeria's petroleum minister tells FT that Royal Dutch Shell (RDS.A, RDS.B), ExxonMobil (NYSE:XOM), Eni (NYSE:E), Chevron (NYSE:CVX) and Total (NYSE:TOT) accepted the settlement of costs incurred during 2010-15, and hopes a deal can be finalized by year-end.
- The settlement, which would be a haircut on the $6B-plus the western companies claim they are owed by Nigeria, needs the approval of two government bodies and final signoff from Pres. Buhari.
- E&P costs are supposed to be split in the partnerships between the two sides, but western companies have accused Nigeria of failing to pay its portion of the expenses, which has caused the companies to hold back on investment.
Tue, Nov. 8, 7:54 AM
- Total (NYSE:TOT) confirms it signed a heads of agreement with the National Iranian Oil Co. for the development of phase 11 of South Pars, the world's largest gas field.
- TOT is the first western energy company to sign a major deal with Iran since the lifting of international sanctions earlier this year; the French major says it will avoid U.S. sanctions on Iran by using its own euro-denominated cash to finance the deal.
- TOT says it will operate the SP11 project with a 50.1% stake, while NIOC subsidiary Petropars will have a 19.9% stake and China's CNPC (NYSE:PTR) will 30%.
- The project’s first phase - the drilling of as many as 30 wells in the Persian Gulf - will require a $2B investment, and a second phase, expected when the wells are producing, will require an additional $2B, TOT Patrick Pouyanne says; an Iranian official said yesterday the project would require a $6B investment.
- The SP 11 project will have a production capacity of 1.8B cf/day, or 370K boe/day, and the produced gas will be fed into Iran's gas network.
Mon, Nov. 7, 8:37 AM
- Iran will sign a preliminary deal with Total (NYSE:TOT) to help develop an offshore gas field, the first under its new oil contract framework with a foreign company, WSJ reports, citing remarks from an oil ministry official in Tehran.
- The “heads of agreement” for development of the giant South Pars gas field also will include China National Petroleum (NYSE:PTR) and Iran’s state-owned Petropars, and will represent an investment of $6B, according to the government official.
- The agreement, which has not yet been confirmed by the companies, would mark a key step toward the return of Western companies to Iran’s giant fields; TOT and CNPC both signed deals years ago to develop the project before sanctions forced them to pull out.
- The South Pars field, which is shared by Iran and Qatar in the Gulf, contains 14T cm of gas, ~8% of the world’s known reserves.
Fri, Nov. 4, 10:59 AM
- France's Total (TOT -0.4%) and Italy's Erg are looking to sell a stake in their Italian refinery business to facilitate an auction of one of the country's biggest service station networks, Reuters reports.
- The sale is expected to begin by year-end, with non-core assets such as refineries and lubricants stripped out to make the deal more attractive, according to the report.
- The two companies jointly control TotalErg, which operates nearly 2,600 service stations in Italy with a ~11% market share and also owns 25% of the Sarpom refinery business; 75% of Sarpom is controlled by ExxonMobil's Esso unit.
Fri, Nov. 4, 10:21 AM
- Ten of the world’s biggest oil companies - including Saudi Aramco, Royal Dutch Shell (RDS.A, RDS.B), BP, Total (NYSE:TOT), Eni (NYSE:E), Statoil (NYSE:STO) and Repsol (OTCQX:REPYF, OTCQX:REPYY) - announce plans to invest a combined $1B over the next 10 years to develop low-carbon technologies.
- The group's Oil and Gas Climate Initiative, which is seeking ways the industry can support a global deal to fight climate change while continuing to produce their hydrocarbon reserves, says its investments initially will focus on carbon capture and storage technology and efforts to reduce methane emissions from the oil and gas industry.
- Environmental groups say the commitment is far from enough and represents a tiny fraction of the $90B-plus the companies expect to spend this year alone on finding and producing fossil fuels.
- The investment comes as last year’s Paris climate accord enters into force, and three days before delegates from nearly 200 countries meet in Morocco for the latest round of talks to flesh out the deal.