Total Share Discussion Threads

[waldron] 15/2/2015 16:46

MERCI SARK

[sarkasm] 15/2/2015 11:17

TIDMTTA



The Board of Directors of Total (Paris:FP) (LSE:TTA) (NYSE:TOT) met on February 11, 2015, and agreed to propose to the Annual Shareholders' Meeting on May 29, 2015, a 2014 annual dividend of 2.44 euros per share, an increase of 2.5% compared to the 2013 annual dividend. This corresponds to a fourth quarter 2014 dividend of 0.61 euros per share, unchanged compared to the previous three 2014 interim quarterly dividends.



The Board will also propose to the Annual Shareholders' Meeting the alternative for shareholders to receive the fourth quarter 2014 dividend in cash or in new shares of the company discounted by 10%.



Subject to approval at the shareholders' meeting:



-- the ex-dividend date for the fourth quarter dividend will be June 8,

2015;


-- the price of each new share will be equal to 90% of the average

opening Total SA price on the Euronext Paris over the 20 trading days

preceding the shareholders' meeting, reduced by the amount of the

fourth quarter dividend, and rounded up to the nearest euro centime;


-- the payment of the dividend in cash or the delivery of shares issued

in lieu of the cash dividend is set for July 1, 2015.



American Depositary Receipts ("ADRs") will receive the final quarterly installment of the 2014 dividend in dollars based on the then-prevailing exchange rate according to the following timetable:


ADR ex-dividend date June 3, 2015
ADR record date June 5, 2015
ADR distribution date for cash or shares July 10, 2015
issued in lieu of the cash dividend



Registered ADR holders may also contact JP Morgan Chase Bank for additional information. Non-registered ADR holders should contact their broker, financial intermediary, bank or financial institution for additional information.



* * * * *



About Total



Total is one of the largest integrated oil and gas companies in the world, with activities in more than 130 countries. Its 100,000 employees put their expertise to work in every part of the industry - exploration and production of oil and natural gas, refining, chemicals, marketing and new energies. Total is working to help satisfy the global demand for energy, both today and tomorrow. www.total.com



TOTAL S.A.



Martin DEFFONTAINESMike SANGSTER



Nicolas FUMEXPatrick GUENKELMagali PAILHE



Tel. : + 44 (0)207 719 7962Fax : + 44 (0)207 719 7959



Robert HAMMOND (U.S.)Tel. : [phone]Fax : [phone]



www.total.com

[sarkasm] 15/2/2015 10:37

By
Inti Landauro in Paris And
Selina Williams in London
Updated Feb. 12, 2015 6:41 p.m. ET
0 COMMENTS

Total SA on Thursday became the latest casualty of the oil-price swoon, reporting a $5.66 billion net loss for the latest financial quarter and promising to shed billions more in cost savings, including 2,000 layoffs by 2017.

‘We don’t gamble at the casino. We need a company that resists whatever the [oil] price is.’
—Total Chief Executive Patrick Pouyanne

The company swung to a net loss for the three months to the end of December from a net profit of $2.23 billion in the same quarter the previous year. Total wrote off $6.5 billion of the value of its less profitable shale and oil-sands ventures, as well as its unprofitable European refineries.

Total said that it intends to become profitable at an oil price of $70 a barrel; Brent crude was trading at $55.80 a barrel on London’s ICE Futures exchange on Thursday morning. Still, the company proposed raising its dividend in the hopes of keeping investors from selling the stock.

Chief Financial Officer Patrick de la Chevardière said in an interview Thursday said the company is preparing for a sustained period of low oil prices, sounding a more cautious note on the commodity than some of his peers.

The company reported its loss a week after rival BP PLC said it had failed to turn a profit in the fourth quarter. Total’s loss came from the write-down of assets that have become less valuable since oil began trading near $50, mainly on shale gas fields in the U.S., oil sands in Canada and refineries in Europe.

Other oil companies have also reported lower earnings, but rivals Exxon Mobi l Corp., Royal Dutch Shell PLC and Chevron Corp. managed to turn a profit.
Market Talk

Total SA’s Dividend/Stock Option Surprises Some French oil giant Total SA didn’t surprise anyone when it proposed increasing its cash dividend, raising it by 2.5% to €2.44 ($2.74) a share—a strategy that could help retain investors during a rocky period. But some observers were taken aback by the option to take the dividend in the form of stock at a 10% discount to the market price. Lydia Rainforth of Barclays PLC wrote in a note to investors that French companies often offer discounts on scrip dividends, and that it would help the company conserve cash. But it also poses a potential problem for current Total investors, who may see their shares diluted by a flood of new stock. “We would also look for clarity in the post-results meeting as to how and when Total would look to offset the dilution created by the scrip dividend option,” Ms. Rainforth wrote. ([e-mail])

Total SA Joins the Capex Cutting Bandwagon Total SA on Thursday joined a host of other big oil companies in slashing its capital expenditures budgets, proposing 10% cut to about $23-24 billion in 2015. BP PLC said last week it would cut its spending on capital and exploration by 20%, to about $20 billion, while Royal Dutch Shell PLC has said it would dole out about $15 billion less over the next three years. Chevron said its capital spending would be about 13% less this year. Analysts have cheered the cuts, calling them necessary belt-tightening in the era of $55-a-barrel oil prices. But investors looking to the long-term have cautioned that the cuts could hurt the companies’ attempts to capitalize when oil prices rebound. ([e-mail])

Market Talk is a stream of real-time news and market analysis that’s available on Dow Jones Newswires.

As with its rivals, Total said it would aggressively cut costs as it reduces its break-even oil price by 36% from last year’s $110 a barrel. As well as the layoffs, the company said it would sell assets valued at $5.5 billion and freeze the hiring of new staff at its production, refinery and petrochemicals operations as part of a $4 billion plan to lower costs and rein in investments this year.

Total Chief Executive Patrick Pouyanné said Thursday that the restructuring plan shows the company’s determination to come to grips with the shift in oil markets.

Mr. Pouyanné, who was holding his first corporate news conference as CEO since he succeeded the late Christophe de Margerie , insisted that he wasn’t overreacting to the situation.

“We don’t gamble at the casino. We need a company that resists whatever the barrel price is,” he said at a news conference. Before taking the CEO job, Mr. Pouyanné ran Total’s beleaguered refining and petrochemicals unit, where he had conducted a cost-cutting effort.
More

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As Oil Price Drops, Texas Lenders Watch for Fallout (02/11/15)
Tullow Suspends Dividend Amid Oil Rout (02/11/15)
Drilling Slows as Oil Price Drops (02/11/15)

Halliburton to Cut 8% of Workforce(02/10/15)
Oil Prices Hurt Exxon’s Profit (02/02/15)

With new projects coming on stream, the company expects to raise its output by more than 8% in 2015 from 2.15 million barrels of oil equivalent in 2014.

Total has proposed increasing its cash dividend, raising it by 2.5% to €2.44 ($2.77) a share while offering shareholders the option of taking the dividend in the form of stock at a 10% discount to the market price.

“It’s not unusual. We did this in 1995,” Mr. de la Chevardière said. “We need the financial flexibility while we face low oil prices, the duration of which we don’t know.”

He said that even if oil prices only went back up to $70 a barrel, that by 2017, the company would still have enough cash flow to consider a share buyback to offset the dilution created by the scrip dividend option. Oil is currently trading at less than $60 a barrel.

Excluding the write-downs and adjusting for changes in inventories, the company reported a net profit of $2.8 billion in the quarter, down from $3.84 billion in the same period a year earlier. The company’s overall revenue declined 19% in the fourth quarter to $52.51 billion from $64.98 billion.

Write to Inti Landauro at [e-mail] and Selina Williams at [e-mail]

[waldron] 14/2/2015 08:17

US will not become energy independent: Total CEO
Holly Ellyatt | Stephen Sedgwick
18 Hours AgoCNBC.com
76
COMMENTSJoin the Discussion

Despite the so-called U.S. shale revolution and American aspirations for energy independence, the CEO of major oil giant Total told CNBC he was not convinced it would happen any time soon.

"The U.S. is still relying on oil from the Middle East. It is not true the U.S. will be independent in oil -- they continue to import," Patrick Pouyanne, the new chief executive of French oil giant Total, told CNBC this week.

Patrick Pouyanne, chief executive officer of Total
Chris Ratcliffe | Bloomberg | Getty Images
Patrick Pouyanne, chief executive officer of Total

He stressed that the U.S. "will not get" energy independence because it still consumes far more oil than it produces.

"For me, the world today is interdependent. This idea that you could be (energy) independent -- especially when you are the U.S., where you have many world companies; a country that is probably benefiting the most from the globalization of the world -- is just something that is strange to me, I don't believe in that," Pouyanne added.

Oil prices have fallen dramatically in recent months – and at one point were down around 60 percent from highs in June 2014, on the back of a glut in supply and lack of global demand. Brent crude is currently trading around $59 a barrel and U.S. crude is at $51.

Read MoreBrent back above $60 as 1986 fears fade

The Organization of Petroleum-Exporting Countries (OPEC) has been blamed for the volatility in prices after it refused to cut production to support the cost of oil. Many saw its inaction as a bid to retain market share in the face of increased competition from U.S. shale oil producers.

American oil production has grown steadily from 5 million barrels per day in 2005 to 8.6 million last year, according to the U.S. Energy information Administration.

If OPEC was hoping a low oil price would put the brakes on U.S. oil production, it might have worked. Some 87 rigs were deactivated in the week ending February 6, according to oilfield services company Baker Hughes, after a drop of 90 rigs over the previous seven days. It marks the largest absolute reduction in a single week since Baker Hughes started keeping records in 1987.
'Good news' for US economy

But Pouyanne said that, despite anger from some at OPEC's "game of chicken," the U.S. was still a major oil importer and its economy was benefitting from a lower oil price

"Maybe the U.S. independent producers are not happy; the U.S. investors in oil and gas are not happy. But globally speaking, for the U.S. economy…(the lower oil price) is good news," he said.

His comments come after Total reported a $6.5 billion writedown in the fourth quarter, mainly on its North American oil sands and shale assets, on Thursday. The oil major also announced cost-cutting measures to counteract the sharp decline in oil prices and said it would reduce investment by 10 percent from 2014's $26.4 billion.

Read MoreCrude oil production: The looming threat to American oil output

But Pouyanne was adamant that Total could "easily" withstand the lower oil price, despite its cost-cutting move.

"When you generate $25 billion of cashflow at $100 a barrel and eventually invest all of that -- even before giving a dividend to your shareholders -- that means we are at a very high level…we have a strong balance sheet we can face the situation for 1, 2, 3 years," he said. "I'm not worried about (it), let me be clear."

Pouyanne's appointment as CEO comes after the former Total head, Christophe de Margerie, was killed when his private jet collided with a snow plough in October. De Margerie was one of the most recognizable of the world's top oil executives and was a hard act to follow, Pouyanne said.

"Christophe was a unique personality. I worked for him for 12 years -- he was visionary on many items, he has a real charisma," he said, adding that it would be a "big mistake" to try to imitate de Margerie.

The CNBC Conversation with Patrick Pouyanne is broadcast Friday at 23:00 CET.

- Written by CNBC's Holly Ellyatt, follow her on Twitter @HollyEllyatt.
Holly EllyattAssistant Producer, CNBC.com
Stephen Sedgwick
Stephen SedgwickAnchor, CNBC

[waldron] 11/2/2015 18:50

FT: Shell, BP in standoff with Abu Dhabi over concessions as Exxon walks • 12:43 PM
Carl Surran, SA News Editor

Royal Dutch Shell (RDS.A, RDS.B) and BP are resisting efforts by Abu Dhabi to get them to pay a multibillion-dollar signing-on fee for a stake in developing the emirate’s biggest onshore fields, FT reports, adding that Exxon Mobil (NYSE:XOM) already has walked away from talks.
Abu Dhabi's state-owned oil company is said to have demanded ~$8B combined from a number of companies hoping for part of a 40% equity stake in oil reserves to be jointly developed over the next 40 years; industry insiders consider the upfront payments one of the bigger ever for an oil concession.
Total (NYSE:TOT) last week became the first to sign a new concession with Abu Dhabi in which the company paid a ~$2B upfront fee to secure its stake, under which it will earn ~$2.85 for every barrel sold vs. $1/bbl under a previous concession.

[grupo guitarlumber] 11/2/2015 08:57

SYDNEY--A dispute over the ownership of one of Papua New Guinea's biggest natural-gas discoveries has been resolved in an international court, paving the way for Total SA (TOT) to seal its acquisition of a 40% stake in the assets.

InterOil Corp. (IOC) last year agreed to introduce the French oil giant as a partner into the Elk and Antelope natural-gas discoveries, but another party to the joint venture, Oil Search Ltd. (OSH.AU), disputed the up-to-US$3.6 billion deal.

Oil Search argued it should be able exercise so-called pre-emptive rights and buy the stake itself at the same price.

On Wednesday, however, Oil Search said the International Court of Arbitration of the International Chamber of Commerce declined to issue pre-emptive rights. Analysts had speculated that if Oil Search had won the dispute, it would have on-sold the stake to another big oil company, such as its current joint-venture partner at the nearby PNG LNG project, Exxon Mobil Corp.

"In a complex, non-unanimous, judgement, the ICC decision declared that Total is a party to the Elk/Antelope joint venture operating agreement," Oil Search said in a statement. The court also ruled that Total will have to comply with some transfer clauses to close the deal.

"Oil Search anticipates that InterOil and Total will attempt to comply with these terms and the company intends to work constructively with its joint venture partners to resolve all outstanding transfer and joint venture management issues," it said.

Write to Ross Kelly at [e-mail]

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[waldron] 10/2/2015 13:38

InterOil wins Elk-Antelope legal case • 7:59 AM
Carl Surran, SA News Editor

InterOil (NYSE:IOC) says the International Chamber of Commerce has dismissed arbitration claims against the company over its farmout to Total (NYSE:TOT) at the Elk-Antelope gas field in Papua New Guinea.
IOC says the arbitration panel dismissed all claims by Oil Search (OTCPK:OISHF) and the PAC LNG companies to pre-emptive rights over the share sale and purchase agreement involving an interest in the field.

[waldron] 10/2/2015 08:44

FRANKFURT--The following is a summary of analysts' forecasts for Total SA (TOT) fourth-quarter results, based on a poll of 13 analysts conducted by Dow Jones Newswires (figures in million dollars, EPS in dollar, target price in euro, output in thousand barrel of oil equivalent per day (kboe/d), according to IFRS). Earnings figures are scheduled to be released February 12.

===
Net income EPS
4th Quarter adjusted adjusted Output
AVERAGE 2,543 1.13 2,199
Prev. Year 3,385 1.49 2,284
+/- in % -25 -24 -3.7

MEDIAN 2,544 1.15 2,201
Maximum 2,798 1.23 2,262
Minimum 2,277 1.04 2,123
Amount(a) 13 9 11

Barclays 2,506 -- 2,176
Deutsche Bank 2,727 1.20 2,252
Investec 2,544 1.11 2,194
J.P. Morgan 2,423 -- --
Morgan Stanley 2,368 1.04 2,138
Natixis 2,627 1.15 2,200
Oddo Securities 2,384 1.04 --
Raymond James 2,599 -- 2,201
RBC CM 2,277 -- 2,217
Santander 2,798 1.23 2,262
Societe Generale 2,668 1.17 2,123
UBS 2,389 1.05 2,206


Target price Rating

AVERAGE 45.67 positive 4
Prev. Quarter 55.33 neutral 6
+/- in % -17 negative 1

MEDIAN 44.50
Maximum 53.50
Minimum 39.00
Amount 9

Deutsche Bank 47.00 Buy
Independent Research 39.00 Sell
Investec 44.50 Hold
J.P. Morgan 44.00 Neutral
Jefferies 42.00 Hold
Kepler Cheuvreux 53.50 Buy
Morgan Stanley -- Overweight
Natixis 43.00 Neutral
Santander 48.00 Hold
Societe Generale -- Hold
UBS 50.00 Buy
===

Year-earlier figures are as reported by the company.

(a) Including anonymous estimates from one more analyst.

DJG/err

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[waldron] 06/2/2015 15:56

Oil company investments in Libya plagued by renewed violence • 10:44 AM
Carl Surran, SA News Editor

Violence in Libya increasingly is hitting oil companies and their assets, hurting long-term investments by Western companies and driving down production.
In the past three months, Libya's oil output has fallen from nearly 900K bbl/day to 325K bbl/day as oil fields are taken over by armed groups or shut down for security reasons.
Affected companies include Total (NYSE:TOT), which closed the Mabruk oil field that once produced 30K-40K bbl/day; the country’s main oil port Sidra was closed because of fighting, hurting the prospects of the three U.S. companies - ConocoPhillips (NYSE:COP), Marathon Oil (NYSE:MRO) and Hess (NYSE:HES) - with a stake in connected fields.
But the global crude oil market has barely reacted to the renewed fighting, because of OPEC’s decision in November not to cut production virtually guaranteed an oversupply whether Libya produces or not, analysts say.

[waldron] 05/2/2015 10:19

By Inti Landauro

PARIS--Oil companies Total SA (TOT) and Royal Dutch Shell PLC (RSDA.LN) have opened exclusive talks to sell SRPP, a gas-station network on the French island of Reunion, to French oil-and-gas-storage firm Rubis SCA (RUI.FR).

Total and Shell own 50% each of SRPP, which operates 51 gas stations on Reunion, and markets fuels, lubricants and gas on the French island located in the Indian Ocean.

The companies didn't give a value for SRPP, which had sales of EUR250 million ($284 million) in 2014.

-Write to Inti Landauro at [e-mail]

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[waldron] 03/2/2015 21:37

Calendar
.

Financial events

Feb. 12, 2015

Fourth Quarter and Full Year 2014 Results .

[waldron] 29/1/2015 19:19

Sent to 8,256 people who get email alerts on TOT.
Get email alerts on TOT »
Total beats BP, Shell to sign giant Abu Dhabi oil field deal
Jan 29 2015, 13:47 ET | By: Carl Surran, SA News Editor [Contact this editor with comments or a news tip]

France's Total (TOT +1.5%) is one of the day's few energy gainers after the surprise announcement of a new deal to operate some of the Persian Gulf's largest onshore oil fields in the United Arab Emirates.
TOT is taking a 10% stake for 40 years in a joint venture with Abu Dhabi National Oil Company to extract crude in the 15 main fields in the UAE with a total output of 1.6M bbl/day.
Four oil majors - TOT, Exxon Mobil (NYSE:XOM), Royal Dutch Shell (RDS.A, RDS.B) and BP - had each held 9.5% equity stakes in the ADCO concession since the 1970s.
Concessions for international oil companies to produce on in the Persian Gulf Arab states such as the UAE are rare and highly prized due to the size of reserves and low production costs.

[waldron] 29/1/2015 10:59

(Bloomberg) -- Total SA won bidding to develop the biggest onshore oil deposits in the United Arab Emirates, making the French energy company the first to be chosen by Abu Dhabi to pump more crude amid a global supply glut.

Abu Dhabi National Oil Co. awarded Total 10 percent of the main land-based concession in the U.A.E.’s largest sheikhdom, for 40 years starting Jan. 1, 2015, the Paris-based company said in an e-mailed statement on Thursday. Adnoc, as the government-owned producer is known, confirmed the award and said it will name other partners “soon.” Total’s stake would account for oil output generating $2.83 billion a year based on yesterday’s closing Brent price of $48.47 a barrel.

Middle Eastern energy suppliers including the U.A.E. are expanding their capacity to produce crude for export as well as to boost output of natural gas, which they burn as fuel in local power plants. The U.A.E., an OPEC member, holds about 6 percent of global oil reserves. Oil prices have dropped 55 percent in the past year amid a surplus of crude that the U.A.E. estimates at 2 million barrels a day.

Adnoc may award part of the concession to Asian producers, Robin Mills, an analyst at Dubai-based Manaar Energy Consulting, said by phone today. “That’s about securing political support and securing markets,” he said. “Adnoc’s biggest buyers are the ones in Asia.”

Total fell 1.5 percent in Paris trading to 44.88 euros.
15 Deposits

Most of the U.A.E.’s oil lies in Abu Dhabi, which plans to raise capacity to 3.5 million barrels a day in 2017 from about 3 million barrels a day now. The 15 deposits in the concession will produce 1.8 million barrels a day by 2017 from 1.6 million barrels today, Total said.

Royal Dutch Shell Plc and BP Plc are “front-runners” to join Total in the project with 10 percent each, International Oil Daily reported Thursday, citing three people it didn’t identify. Shell and BP declined to comment.

China National Petroleum Corp. together with either Japan’s Inpex Corp. or South Korea’s Korea National Oil Corp. may split the remaining 10 percent being offered, leaving Abu Dhabi with a majority 60 percent, IOD said.

Abu Dhabi is one of the few places in the Persian Gulf region where the largest U.S. and European producers still hold direct stakes in oil fields. Saudi Arabia and Kuwait, fellow members of the Organization of Petroleum Exporting Countries, don’t allow foreigners to own stakes in crude production.

Adnoc has been seeking for more than a year to line up new foreign partners to develop the emirate’s onshore deposits. Its previous joint venture with Total, BP, Shell, Exxon Mobil Corp. and Portugal’s Partex Oil & Gas expired in January 2014. Adnoc invited 11 companies to bid for the new concessions, it said in November 2013 as the renewal process began.

Other bidders were Norway’s Statoil ASA, Occidental Petroleum Corp. of the U.S., Russia’s OAO Rosneft and Eni SpA of Italy.

To contact the reporter on this story: Anthony DiPaola in Dubai at [e-mail]

To contact the editors responsible for this story: Nayla Razzouk at [e-mail] Claudia Carpenter

[waldron] 29/1/2015 06:19

Avoid big oils stuck on misguided view of return to higher oil prices, Citi says • 5:20 PM
Carl Surran, SA News Editor

Big oil companies such as Exxon Mobil (NYSE:XOM), Chevron (NYSE:CVX) and Royal Dutch Shell (RDS.A, RDS.B) are betting too much on a return to higher oil prices, Citigroup says.
The industry now looks to be adopting a slightly adjusted Plan A, with some capex cuts and cost-control but still with a fundamental view that higher oil prices will come to the rescue, CIti says, convinced that best results will be achieved only if the industry commits to full self-help action - Plan B - where the underlying principle is that oil prices may not recover any time soon.
Citi recommends buying the companies closest to moving to Plan B - Total (NYSE:TOT), BP and ConocoPhillips (NYSE:COP) - and avoid those still stuck on Plan A - Exxon, Chevron and Shell.

[waldron] 28/1/2015 18:55

Total will round out the season on Feb. 12, when the French oil giant is expected to report an 11 percent decline in fourth-quarter net income to 2.19 billion euros ($2.49 billion).

[waldron] 28/1/2015 10:40

(Bloomberg) -- Financial results from a fourth quarter that saw the collapse of the crude market will provide a window into how the world’s biggest oil companies are adjusting to a new reality of slowing growth and low prices.

Oil that topped $115 a barrel as recently as June has been trading below $50 a barrel since the first week of the year, portending a bleak 2015 for the world’s five so-called supermajors -- Exxon Mobil Corp., Royal Dutch Shell Plc, Chevron Corp., Total SA and BP Plc. The companies, whose businesses combine oil and natural gas exploration with refining and chemical manufacturing, have historically been among the most resilient players during down cycles.

This could be the oil bust that breaks that pattern.

“The issue for this group of companies is they don’t have bulletproof business models,” said Brian Hennessey, who helps manage $1.4 billion at Alpine Woods Capital Investors LLC in Purchase, New York. A 57 percent plunge in the price of oil since June “really tests your convictions.”

The industry’s stark change in fortune set off panic from corporate board rooms to drill-rig floors as companies that pump almost one-tenth of the world’s crude scramble to tighten budgets and preserve cash for dividends, buybacks and capital projects too far along to abandon.

BP froze wages, Chevron delayed its 2015 drilling budget and Shell canceled a $6.5 billion Persian Gulf investment; layoffs industrywide have topped 30,000, enough to fill almost every seat in Madison Square Garden twice.
Searching Clues

Investors will be sifting the data from the fourth quarter for clues to how long the current slump will last. Momentum from $109 a barrel oil during the first half of the year helped carry producers through the last three months, when the price of Brent, the benchmark used by most of the world, averaged $77.07 -- well above the current price of $49.

The effects of lower prices will still take their toll as all except Shell are forecast to report earnings declines compared with the fourth quarter of 2013. Shell profits are expected to rise compared with unusually ugly results the year before.

Worldwide crude supplies appear likely to exceed demand for the rest of the year and beyond, even as the lowest oil prices since 2009 discourage new developments in high-cost regions such as Canada’s oil sands, said Paul Sankey, an analyst at Wolfe Research in New York. That would postpone any rebound in share prices of the five biggest oil majors, which have tumbled by an average of 8.1 percent since crude prices began to slide in June.
‘DangerousR17; Equities

That compares with a 28 percent decline in a Standard & Poors index of 18 smaller U.S. oil and gas producers.

“Buying oil equities here would be dangerous,” Sankey said in a Jan. 27 note to clients. “Our research suggests that the consensus view that oil markets will recover by the second half of 2015 may well be optimistic.”

The price collapse hobbles a segment of the industry that had already been struggling with years of soaring construction costs, project delays, missed output targets and depressed returns from refining crude into fuels, said Anish Kapadia, an analyst at Tudor Pickering Holt & Co. Aside from steady dividend payouts, the biggest oil companies offer no compelling reason to invest, he said.

“We see little to differentiate between the supermajors as no-growth yield plays,” Kapadia said in a note to clients.
Shell Increase

Shell kicks off the earnings season for the biggest oil companies on Jan. 29. The Hague-based company is expected to report profit, excluding special items and inventory changes, of $4.18 billion, based on the average of seven estimates from analysts in a Bloomberg survey. That would represent a 44 percent increase from a year earlier, when faltering production from wells and escalating costs trimmed earnings to a four-year low.

Chevron on Jan. 30 is expected to post fourth-quarter net income, excluding one-time gains and losses, of $3.17 billion, based on the average of nine analysts’ estimates. That would be a 36 percent year-over-year decline.

Exxon is next up when it reports results on Feb. 2. The Irving, Texas-based producer probably reaped $5.85 billion in net income, excluding one-time items, according to the average of 11 estimates from analysts. That would represent a 30 percent decline from a year earlier.

BP is expected to report profit of $1.98 billion, excluding one-time items and inventory changes, when it posts results on Feb. 3. That would compare with $2.81 billion during the final three months of 2013.
Price Sensitive

Total will round out the season on Feb. 12, when the French oil giant is expected to report an 11 percent decline in fourth-quarter net income to 2.19 billion euros ($2.49 billion).

As cash flows shrink this year, dividend protection will take precedence over finding new oil fields or repurchasing shares. The supermajors are exquisitely sensitive to price fluctuations; for example, every $10 decline in the oil price slashes $2.84 billion from Exxon’s annual cash flow, according to Barclays Plc. For Chevron, which is more dependent on crude than its larger U.S. rival, the cut is $3.85 billion.

The supermajors “are going to hunker down to protect the dividend,” Iain Reid, an analyst at BMO Capital Markets, said in a telephone interview. “The dividend will stay safe for two years.”

To contact the reporter on this story: Joe Carroll in Chicago at [e-mail]

To contact the editors responsible for this story: Susan Warren at [e-mail] Steven Frank

[waldron] 20/1/2015 19:34

Total to cut 2015 capex by 10% but vows surgical response to oil slide • 2:26 PM
Carl Surran, SA News Editor

Total (TOT -0.9%) will reduce capital spending by a larger than expected 10% in 2015 from $26B last year, CEO Patrick Pouyanné says, including a 30% cut in its exploration budget to less than $2B.
Pouyanné tells FT that his response to tumbling crude oil prices will be surgical rather than drastic, selling some less profitable development projects and delaying others, and "nobody will be fired" despite what is sure to be a contentious restructuring of TOT’s troubled refining business in France.
Two costly oil sands developments in Canada will be put on “a long backburner” and proposals to sell $10B in assets by 2017 will be accelerated, the CEO says.
Pouyanné says his central aim is to reduce TOT's break-even price by $40/bbl.

SEEKING ALPHA

[waldron] 11/1/2015 17:11

Jeremy Leggett, former industry adviser, warns over plunging commodity prices and soaring costs of risky energy projectsShare 14
inShare.0Email Terry Macalister
The Guardian, Sunday 11 January 2015 16.47 GMT Jeremy Leggett: 'One of the oil companies will break ranks and this time it is going to stick.' Photograph: Linda Nylind for the Guardian
The oil price crash coupled with growing concerns about global warming will encourage at least one of the major oil companies to turn its back on fossil fuels in the near future, predicts an award-winning scientist and former industry adviser.

Dr Jeremy Leggett, who has been invited into the oil giants for consultations on climate change with senior executives that span a 25-year period, says it will not be a rerun of the BP story when the company started to pursue their “Beyond Petroleum” strategy and then did a U-turn.

“One of the oil companies will break ranks and this time it is going to stick. The industry is facing plunging commodity prices and soaring costs at risky projects in the Arctic, deepwater Brazil and elsewhere,” he said.

“Oil companies are also realising it is no long morally defensible to ignore the consequences of climate change,” said Leggett who went on to become a solar entrepreneur and climate campaigner.

Leggett points to Total of France as the kind of group that could abandon carbon fuels in the same way that E.ON, the German utility, announced plans before Christmas to spin off coal and gas interests and concentrate its future growth on renewables.

Pressure on the energy industry to pull out of fossil fuels has grown in recent months with a gathering campaign for pension funds to disinvest from coal, oil and gas.

A new report published this week by researchers at University College London deepened the message that vast amounts of oil in the Middle East, coal in the US and gas in Russia cannot be exploited if the global temperature rise is to be held at the 2C level safety limit agreed by countries.

Leggett, who once conducted research into shale funded by BP and Shell, chairs a Carbon Tracker Initiative which also aims to raise awareness among key decision-makers about the risks that fossil fuel investments pose to wider financial stability.

And he believes that the current 50% slump in the price of Brent crude will cause the US shale boom to go bust with potentially alarming consequences for the financial system.

“Many of the shale drillers have been feasting on junk bond finance which was so easy when oil prices were above $100 (£66) but with prices at $50 confidence is going to collapse. Should the shale narrative evaporate then it is going to be very embarrassing for all sorts of political promoters of the industry, including George Osborne.”

Leggett says despite the price collapse due to oversupply and a lack of demand, he remains convinced that the “peak oil” theory that supplies will not be able to meet demand eventually remains intact.

This is not because there are not the oil or gas reserves in the ground to meet future growth but because they are too costly and environmentally dangerous to produce, he argues.

“I would say to both the utility industry and the oil and gas industry: its game over, guys. You have got to identify the point at which it’s all going to be thoroughly changed and you have got to map back from it,” he said.

“You have to think strategically. The point to map back from is zero carbon in the energy system, not the electricity system, by 2050, because more than 100 governments want that in the [next UN Climate Change] treaty being prepared for signing in Paris.”

But he also believes that the energy industry is privately aware of the problems as it watches its own costs of fossil fuel extraction going up while the costs of solar and other new technologies are coming down.

Leggett, who plans to stands down as chairman from the highly successful Solarcentury renewable business he founded, to concentrate on climate change campaigning, holds what he calls “friendly-critic” sessions with the fossil fuel sector these days. The tone of the meetings has changed significantly over the past two years, he says.

“Before it was know your enemy. Now it’s crikey. A lot of this may be coming true on our watch. What shall we do about it? There are top-to-bottom strategic reviews going on in E.ON but in other companies as well, utility and oil and gas. So it will be really interesting to see which is the first of the oil and gas companies to break from the pack, although I fear BP and Shell are going backwards not forwards on carbon.”

[waldron] 07/1/2015 17:19

The Abu Dhabi National Oil Company (Adnoc) has partnered with the French oil major Total to create a map that could help increase extraction of oil and gas in the UAE and region.

The Digital Rock Physics (DRP) project will archive the varying carbonate reserves found in areas deep under the earth’s surface where oil and gas is difficult to recover. About 70 per cent of oil and 90 per cent of gas reserves in the Middle East are held within these deep formations.

The map will assist in the further examination of how easy it will be for these fuels to flow through the soil.

Dr Steve Griffiths, Masdar Institute’s executive director of institute initiatives, said this process is an integral part of enhanced oil recovery (EOR). “This is one of the most key factors on how easy it is to put fluid in, and how easy it is to get it out,” he said.

EOR refers to injecting substances – usually gas – to increase crude oil extraction.

The state-owned Adnoc wants to increase its current oil recovery rates of about 30 per cent to as high as 70 per cent on maturing fields. “To get 70 per cent means more sophisticated technology is required,” Dr Griffiths said.

As the first programme of its kind in the Middle East, it will also use expertise and technology from the Petroleum and Masdar institutes. The aim is to learn more about these formations so that Adnoc and others can make better predictions on the ease or difficulty of extracting oil and gas, which will ultimately cuts costs and maximise recovery rates.

It also allows for digital simulations to help companies test methods in a laboratory before work at an oil or gasfield.

“It’s really about trying to understand what is the true structure of these soils down to the nano-scan level so you know how oil and gas interacts with these soils and structures,” Dr Griffiths said. “You have to get to that level to do your business.”

In keeping with its EOR ambitions, Adnoc has also partnered with Masdar Institute in a pilot project that will inject carbon dioxide (CO2) to increase oil production at one of its onshore fields. The two announced a joint venture for the scheme covering carbon, capture, usage and storage (CCUS).

Adnoc exploration and production director Mohamed Butti Al Qubaisi said that if the pilot was successful, it could have major benefits for Abu Dhabi in the long term. “We are keen to move ahead to better realise the mechanisms of CO2 injection and production in our fields,” he said.

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