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Strategy and Outlook – Total SA

Total SA · Sep 24, 2019 · 60 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. Strategy and Outlook – Total SA – slide 1
    Strategy and Outlook September 2019
  2. Strategy and Outlook – Total SA – slide 2
    Total, sustainable and profitable growth Sustainability means Coping with volatile and changing energy markets Focusing on breakeven and financial strength Building on our strengths for profitable integrated oil & gas…
  3. Strategy and Outlook – Total SA – slide 3
    Safety, Totals core value Cornerstone of operational efficiency and sustainability Total Recordable Injury Rate for Total and peers* Per million man-hours 2 Contractors 1 0.8 Group Staff 2014 1H19 But 3 fatalities…
  4. Strategy and Outlook – Total SA – slide 4
    Reducing CO2 emissions while growing the company Scope 1 & 2 emissions from operated oil & gas facilities Mt/y - CO2 eq CH4 46 Flaring reduction Methane reduction 42 < 40 Energy efficiency Process electrification New…
  5. Strategy and Outlook – Total SA – slide 5
    Market trends: coping with volatile and changing energy markets
  6. Strategy and Outlook – Total SA – slide 6
    Energy markets in transition Global energy demand Oil Mboe/d 25% of energy demand in IEA 2C in 2040 No more growth by 2040 300 Gas Renewables Growing in all scenarios, abundant and affordable, essential complement to…
  7. Strategy and Outlook – Total SA – slide 7
    Oil market fundamentally volatile Supply-demand and OECD inventories Mb/d, days of demand cover Demand +1.1 Mb/d Sensitive to price and global economic demand in 2019* growth 100 Slower demand growth anticipated for 2019-20…
  8. Strategy and Outlook – Total SA – slide 8
    Growing gas markets Gas demand Bcm/y 4,000 3.8%/y over 2015-18 Supply 1.5%/y Increasing role of LNG in international gas over 2010-15 trade: 9%/y growth over 2015-18 Fast growing US LNG production Demand Stimulated by low…
  9. Strategy and Outlook – Total SA – slide 9
    Strong momentum in LNG markets Asia driving LNG growth Medium-term LNG supply & demand 2015-40 LNG demand Mt/y Mt/y 5% Other 700 CAGR 9%/y Middle East Market 5-6%/y Europe 450 tightening To be Rest of Asia sanctioned…
  10. Strategy and Outlook – Total SA – slide 10
    Europe: committed to energy transition EU 28 power generation mix Twh/y Coal 3,000 Oil Nuclear Liberalization of markets: opportunity for newcomers 1,500 Renewables Natural gas supported by ETS* against coal Strong…
  11. Strategy and Outlook – Total SA – slide 11
    Renewables capturing most of world power growth World power generation mix Twh/y 50,000 Demand Dynamic power growth driven by non-OECD Renewables countries, in particular China and India 25,000 Supply Natural gas…
  12. Strategy and Outlook – Total SA – slide 12
    Petrochemicals sustained by growing demand Polyethylene market Mt/y 3% CAGR Excess Demand: strong market fundamentals capacity* Growing population Lighter weight materials 100 Recycling offers further growth opportunities…
  13. Strategy and Outlook – Total SA – slide 13
    Sustainability: focusing on breakeven and financial strength
  14. Strategy and Outlook – Total SA – slide 14
    Controlling breakeven at the heart of sustainability Pre-dividend organic cash breakeven /b 120 90 Discipline on spend (Opex and Capex) Brent price 60 Highgrading portfolio by counter-cyclical M&A 30 Sustainable…
  15. Strategy and Outlook – Total SA – slide 15
    Capex discipline and operational excellence Organic Capex Successfuly starting-up giant projects in 2018-19 B Deepwater and LNG 20 10 0 2015 2016 2017 2018 2019 Evaluating projects at 50 /b 5 FPSO 600 kboe/d…
  16. Strategy and Outlook – Total SA – slide 16
    Keeping constant pressure on Opex Opex savings vs. 2014 base Leveraging synergies to reduce costs B 5 B Maersk Oil synergies delivered quicker than expected 4.7 B 2019+ cost synergies: 300 M/y 4.2 Headcount reduced by 30% in…
  17. Strategy and Outlook – Total SA – slide 17
    Extending cost saving program New Group cost reduction program Production costs* B - Savings vs. 2014 /boe 10 6 B 5 B < 5.5 5 2020 2023 2014 2018 2020 + 1 B in 2023 vs. 2020 Targeting 5 /boe 50% Upstream, 50%…
  18. Strategy and Outlook – Total SA – slide 18
    Digital: stepping up value creation Creation of a Digital Factory in 2020 Impact on Impact on 200-300 Upstream Midstream and Downstream dedicated engineers 1 B/y* 500 M/y* Google partner on A.I. in Geoscience Levers: revenues,…
  19. Strategy and Outlook – Total SA – slide 19
    Downstream: sustainable cash flow from diversified portfolio Best-in-class 25% ROACE Downstream CFFO B Restructured Refining & Chemicals 7 European refineries breakeven < 20 /t Non-cyclical Marketing & Services Leveraging…
  20. Strategy and Outlook – Total SA – slide 20
    Strong balance sheet further ensures sustainability Gearing < 20% Net-debt-to-capital Net-debt-to-capital for Total and peers* % %, end-2Q19 excluding leases impact 22% 21% 20.6% Leases 20% 15.5% impact 12% 2015 2016 2017…
  21. Strategy and Outlook – Total SA – slide 21
    Outperforming peers in 1H 2019 Production growth 1H19 vs. 1H18 CFFO (exc. wc) growth 1H19 vs. 1H18 % % 10% 5% -0 Downstream ROACE rolling 12 months Group ROACE rolling 12 months % % 30% 10% 5% * Peers: BP,…
  22. Strategy and Outlook – Total SA – slide 22
    Oil & Gas: building on our strengths for sustainable and profitable integrated growth
  23. Strategy and Outlook – Total SA – slide 23
    Oil & Gas: building on our strengths Leveraging expertise in 7 core areas in an integrated strategy 1 Deepwater 2 LNG 3 Petrochemicals 4 Retail & Lubricants Africa 5 Market leader Middle East & North Africa 6 Partner of…
  24. Strategy and Outlook – Total SA – slide 24
    Sanctioning new wave of profitable projects Launching 800 kboe/d to fuel growth post-2023 IRR* 15% Troll, Ekofisk at 50 /b Arctic LNG 2 Glendronach Johan Sverdrup 2 Cameron LNG Extension Dunga Ph. 3 Energia Costa Azul…
  25. Strategy and Outlook – Total SA – slide 25
    Short cycle projects with flexible Capex Short cycle projects delivering cash Tie-backs to existing units in Angola B - 60 /b Block 0 4 150 kboe/d WI 30% Block 14 Infills Infills 10 wells 10 wells Angola 2 IRR 20% at 50…
  26. Strategy and Outlook – Total SA – slide 26
    Leveraging favorable supply chain to launch projects Simplifying designs Upstream Capital Cost Index Base 100 in 2014 IHS Markit 2Q19 100% International E&P costs stabilized at low level -30% vs. 2014 US E&P focus on shale…
  27. Strategy and Outlook – Total SA – slide 27
    Exploration: seizing high quality acreage delivering results North-Obskoye Salmanov Jurassic Nyakhartinskoye 1.2 B 25 per year wells per year Glendronach Yamal Gydan Glengorm North Sea East Mediterranean Myanmar Ballymore…
  28. Strategy and Outlook – Total SA – slide 28
    Promising start in Guyana basin exploration Jabillo CANJE (35%) Bulletwood Successful first wells Jethro Sapote Jethro: oil bearing high quality sandstone Joe Kumaka reservoirs, 55 m net oil pay Malone ORINDUIK Joe: play…
  29. Strategy and Outlook – Total SA – slide 29
    M&A: counter-cyclical portfolio management in line with strategy Acquisitions and divestments 2015-20 B 30 Anadarko African 11 Bboe of resources added at < 2.5 /boe assets* Maersk Oil 5 B 2019-20 (shares Divestment 30%…
  30. Strategy and Outlook – Total SA – slide 30
    Anadarko African assets, clear strategic fit Africa, LNG Mozambique Area 1: one of a kind asset Low acquisition price < 1.5 /boe Giant high quality resources 60 Tcf Sanctioned 12.8 Mt/y LNG operated project with competitive…
  31. Strategy and Outlook – Total SA – slide 31
    Refining & Chemicals: a focused strategy Consistently delivering 20% ROACE Investing in Priority to integrated platforms Growing Petrochemicals low carbon solutions 70% capital employed Building on low cost feedstocks Biofuels:…
  32. Strategy and Outlook – Total SA – slide 32
    Expanding high return Petrochemicals Building on world class Investing in low cost feedstock Integrating monomer and integrated platform 60% by 2025 polymer capacities Antwerp Normandy Satorp Daesan Port Arthur Qatar…
  33. Strategy and Outlook – Total SA – slide 33
    M&S: growing selectively and delivering non-cyclical cash flow Expanding in large fast Developing Growing in growing markets non-fuel revenues low carbon fuels 4,000 stations targeted in new Increasing Shop Food & EV charging:…
  34. Strategy and Outlook – Total SA – slide 34
    M&S: expanding in large fast growing markets Building on worldwide network of 20,000 service stations by 2025 Mexico Saudi Arabia China 500 500 1,000 stations stations stations Targeting 4,000 stations in new markets Building…
  35. Strategy and Outlook – Total SA – slide 35
    Investing in growing energy markets for sustainable long term
  36. Strategy and Outlook – Total SA – slide 36
    Integrating climate into strategy Taking into account anticipated market trends Global energy demand Mboe/d Focusing on oil projects with low breakeven 300 Expanding along the Renewables gas value chain Nuclear Coal…
  37. Strategy and Outlook – Total SA – slide 37
    iGRP: investing in growing markets Building strong positions along the integrated gas and electricity chains Global LNG Electricity in Europe Renewables worldwide Expanding Integrating along the Selectively investing in wind…
  38. Strategy and Outlook – Total SA – slide 38
    Growing LNG position to fully capture economies of scale LNG sales Integrated gas CFFO Mt/y B - 60 /b 6 50 Supply from 2.5 x 3rd party 3 25 Supply from equity JVs Spot Equity JV sales to 3rd party 2018 2020 2025…
  39. Strategy and Outlook – Total SA – slide 39
    Russia LNG: long term partnership delivering growing cash flow Novatek Russia delivering growing CFFO B B/y at 60 /b 1.0 Dividend received since 2011 10 Novatek dividends Value of shares on 13/09/2019 0.5 5 Yamal…
  40. Strategy and Outlook – Total SA – slide 40
    Building strong US LNG position Key market for global portfolio player 1 10 Mt/y US LNG LNG supply exporter by 2021 by 2021 Sustainable abundant low cost feedstock Sabine Pass T3-T5 Cove Point Freeport T3 Integrated along the…
  41. Strategy and Outlook – Total SA – slide 41
    Europe: developing a customer portfolio to pull LNG value chain 2025 Customers CCGT (3 GW) 2 Mt consumed Midstream Supply Regasification capacities LNG Portfolio 10 Mt/y out of 20 Mt/y 10 Mt/y out of 50 Mt/y Marketing (3 M gas…
  42. Strategy and Outlook – Total SA – slide 42
    Developing integrated strategy along the power chain in Europe Generation Infrastructure Trading Customers Marketing B2B/B2C Renewables 8 M power customers 7* GW by 2025 by 2025 Mobility services Trading 175 TWh in…
  43. Strategy and Outlook – Total SA – slide 43
    Selectively investing in worldwide renewables market Targeting free cash flow positive by 2025 Renewables capacity installed Renewables business model GW* 25 GW 15% 1 Development 20 Asia Americas Leverage Africa, ME 10% 2…
  44. Strategy and Outlook – Total SA – slide 44
    Investing in carbon neutrality businesses Anticipating on carbon pricing Energy efficiency Nature based solutions CCUS GreenFlex: 400 people, Dedicated business unit in place 10% of R&D program 2018 turnover 500 M Investing 100…
  45. Strategy and Outlook – Total SA – slide 45
    Our ambition: reducing the carbon intensity of energy products used by our customers Carbon intensity of the energy products sold to our customers Base 100 in 2015 (75 gCO2e/kbtu) Ambition Realized -15% 2015-30 100 95 85…
  46. Strategy and Outlook – Total SA – slide 46
    Outlook 2025 & Shareholder return
  47. Strategy and Outlook – Total SA – slide 47
    Sustainably growing profitable production Production Mboe/d 5%/y 3%/y Numerous Production Project project start-ups stabilization start-ups Leveraging portfolio of high-value projects 3.5 LNG projects driving profitable…
  48. Strategy and Outlook – Total SA – slide 48
    Committed to disciplined Capital spend While being active on portfolio management Capital investment 2020-25 Capital investment B/y % 16-18 18* 15-17 Downstream Exploration & Production 15 Low carbon electricity…
  49. Strategy and Outlook – Total SA – slide 49
    Strong cash flow growth Debt adjusted cash flow (DACF) B 35 +1 B/y iGRP and Downstream driving growth 26.1 iGRP: +3.5 B in 2025 vs 2019 mainly driven by LNG 71 62 60 60 60 Downstream: +2 B in 2025 vs 2019 /b /b /b* /b*…
  50. Strategy and Outlook – Total SA – slide 50
    Moving towards sustainable long term businesses Capital employed CFFO % % Downstream Downstream iGRP iGRP E&P E&P 2019 2025 2019 2025 At Brent 60/b NBP 5.5 /Mbtu - HH 2.5 /Mbtu Note: at 60 /b 2019 Strategy…
  51. Strategy and Outlook – Total SA – slide 51
    Confirming priorities for cash flow allocation 1 2 3 4 Capital Balance Share Dividend investment sheet buyback Maintain 5 B over 2018-20 Discipline New guidance gearing < 20% Sharing extra cash grade A credit rating 60…
  52. Strategy and Outlook – Total SA – slide 52
    Sustainable dividend growth Dividend vs. Brent Clear visibility on /share 2019-25 strong cash flow growth +1 B per year at 60 /b 3.0 CAGR 150 Dividend 2000-18 per share +6%/y +8%/y in 100 Increasing dividend Brent (/b)…
  53. Strategy and Outlook – Total SA – slide 53
    Sustainable ESG commitment Totals commitment to ESG recognized by Sustainable relationship with local stakeholders rating agencies A- grade Climate Change Best score for an O&G Major and Water Security In Nigeria, on Egina…
  54. Strategy and Outlook – Total SA – slide 54
    Total, sustainable and profitable growth Priority to growing markets: LNG and low carbon power Focusing on organic breakeven < 30 /b and balance sheet strength (gearing < 20%) Maintaining discipline on spend 16-18 B/y Capex…
  55. Strategy and Outlook – Total SA – slide 55
    Appendix
  56. Strategy and Outlook – Total SA – slide 56
    Portfolio sensitive mainly to oil prices 2019 production CFFO sensitivity to prices* Power Local power prices 100% Local markets Low volatility HH NBP/TTF +1 /Mbtu Gas +0.3 B 50% Brent +10 /b +3.2 B Oil Oil, Gas,…
  57. Strategy and Outlook – Total SA – slide 57
    IMO 2020: positive impact on crude differentials Crude oil Differentials vs. Brent Low sulfur crude value increasing /b 5.5 Low sulfur 5 Nigerian 4.5 4 3.5 Low sulfur 3 Angolan 2.5 2 Total: 1.5 60% 1 low sulfur 0.5 0…
  58. Strategy and Outlook – Total SA – slide 58
    Refining ready for IMO 2020 High Sulfur Fuel Oil production Distillate yield Mt/y % 7 Antwerp modernization Port Arthur coker Logistic segregation Total: 50% LS/HS crude flexibility 2 Worldwide: 40% 2017 2020…
  59. Strategy and Outlook – Total SA – slide 59
    Priority to low breakeven projects Breakeven - Integrated LNG projects /Mbtu DES Asia pre-FID and under construction 15 10 5 Source: WoodMackenzie LNG tool, 2019 Q2, Breakeven 10% IRR 2019 Strategy and Outlook 59
  60. Strategy and Outlook – Total SA – slide 60
    Integrated and diversified along the value chain Yamal LNG Snhvit LNG Artic LNG 2 Rotterdam Cove Point LNG Skikda LNG Driftwood LNG Bethioua Egyptian LNG T1 ECA LNG Cameron LNG Sohar LNG Freeport LNG Sabine Pass LNG…

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