Total S.A.: Is The Business Model Viable?
Richard Zeits • 10 Comments
Richard Zeits • 10 Comments
Today, 7:59 AM
- Iran's government says Royal Dutch Shell (RDS.A, RDS.B) will sign three MoU agreements in Tehran today to develop the South Azadegan, Yadavaran oil fields and the Kish gas field, confirming earlier reports.
- The government also says Total (NYSE:TOT), which last month signed the first deal by a Western energy firm since sanctions were lifted on Iran, will begin talks about new oil and gas projects but will not sign any deals today.
- "These preliminary agreements come at the right time for [Iran's] Pres. Rouhani, who can leverage on the nuclear deal bearing fruits for Iran's economy despite Trump's election," says an analyst at Wood Mackenzie.
- Foreign firms eyeing Iran's vast oil and gas reserves have made few inroads into the country despite the lifting of many sanctions and the new contracts that Iran hopes will improve the terms offered for oil development deals.
Today, 5:48 AM
- Royal Dutch Shell (RDS.A, RDS.B) and Total (NYSE:TOT) will sign initial agreements today to develop oil and gas fields in Iran, in the first European petroleum deals in the country since sanctions eased earlier this year.
- But the plans open both companies to potential risks from the incoming Trump administration.
- Though Total is French and Shell is jointly headquartered in London and The Hague, both companies have substantial American operations.
Yesterday, 2:57 PM
- BP has the highest exposure in the countries that have said they will cut oil production, Rystad Energy says, with the likely participation of Russia, where BP holds a 20% stake in Rosneft (OTC:RNFTF), puts it ahead of rivals Total (NYSE:TOT), Shell (RDS.A, RDS.B), ExxonMobil (NYSE:XOM), Eni (NYSE:E) and Chevron (NYSE:CVX).
- “If Russia should deliver on their production cut, we believe that the fields operated by Rosneft will be affected,” Rystad's Espen Erlingsen says. "Also in Iraq, the government will need to reduce production from the large Basra fields. Here the BP-operated Rumaila is a likely candidate for cuts.”
- BP has ~1.6M bbl/day of production in the affected countries, with Russia accounting for roughly half the total, according to the Rystad analysis; Total has ~700K bbl/day of output in the countries, Shell has 586K bbl/day, followed by XOM with 563K, Eni with 497K, and CVX 194K.
Mon, Dec. 5, 7:17 PM
- In addition to Pemex's farmout of the Gulf of Mexico's potentially lucrative Trion oil field to BHP Billiton, beating out BP, today's final phase of Mexico’s first oil and gas bid round awarded of eight of 10 deepwater blocks in the Gulf to a variety of global operators.
- In four other areas surrounding Trion in the Perdido Fold Belt, areas 1 and 4 went to China's Cnooc (NYSE:CEO), area 2 to a consortium of Total (NYSE:TOT) and ExxonMobil (NYSE:XOM), and area 3 to a group comprising Chevron (NYSE:CVX), Pemex and Inpex.
- In the Salina basin to the south, areas 1 and 3 went to a consortium of Statoil (NYSE:STO), BP and Total (TOT), area 4 to Sierra Offshore and a Mexican entity, and Area 5 to a group led by Murphy Oil (NYSE:MUR) and Sierra Offshore; areas 2 and 6 received no bids.
- CEO, STO and Pemex each submitted individual bids that did not win an award, while consortia that unsuccessfully submitted bids were Eni (NYSE:E) and Lukoil (OTC:LUKOF, OTCPK:LUKOY), and Royal Dutch Shell (RDS.A, RDS.B) and Atlantic Rim Mexico.
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.