2023-09-25 10:26:00
(AOF) –
Totalenergies
(+1.05% to 62.56 euros)
The group is still benefiting from the continued rise in the price of oil (+0.30% to $93.55). It begins a second consecutive session in the green while black gold reaches a high in almost a year and is heading towards the 100 dollar mark.
AOF – LEARN MORE
Key points
– Integrated energy group, 3rd largest oil company in the world, 2nd largest gas company and world number one in solar with Sun Power;
– Activity of $141 billion organized into 4 branches: 45% for marketing & services (distribution networks, etc.), 40% in refining & chemicals, 11% in renewables, gas and electricity then exploration- production ;
– Economic model of transformation in ten years into a multi-energy group, producer of oil & LNG (liquefied natural gas), renewable energies & electricity and hydrogen & biomass;
– Open capital (6.4% held by employees), the board of directors of 12 members being chaired by Patrick Pouyanné also general director;
– Solid balance sheet: debt ratio of 7% and return on equity of 32%.
Challenges
– 2020-2030 strategy + energy, – emissions:
– change in the distribution of sales -30% petroleum products, 50% gas, 15% electricity and 5% biomass and hydrogen,
– discipline in investments -$13 to $15 billion per year over 2022-2025, including 50% allocated to renewables and electricity and 50% to natural gas;
– Innovation strategy led by One Tech, with $850 million for 18 R&D centers:
– 3 hubs: industrial, development and support,
– 5 programs: production, CO2 and sustainability, upstream operational efficiency, downstream & polymers, fuel and lubricants,
– a digital factory to generate $1.5 billion in savings by 2025;
– Environmental strategy 2050:
– carbon neutrality for the group’s operations and products sold in Europe, reduction of 60% or more in the carbon intensity of products used outside Europe;
– 4 axes: growth in the gas value chains (natural, biogas and hydrogen), in low-carbon electricity (annual envelope of $1.5 to $2 billion), in low break-even oil, in biofuels , in activities contributing to carbon neutrality (natural wells, forests, etc.),
– solar and renewables: production capacity of 25 Gw by 2025,
– carbon fund with $400 million to invest by 2025;
– Ramp-up of renewables & electricity activities, now grouped within the Integrated Power division, with a capacity portfolio of 35 GW by 2025, including +20 GW secured by long-term purchase contracts; ;
– Acceleration of the energy transition with equity investments in 2 Qatari and Indian projects (solar, LNG and hydrogen) and in Clearway, 5th American renewables, 29% of industrial investments going to low-carbon energies;
– Industrial excellence in oil production with a breakeven point of -$20/bbl, with numerous projects in progress (Nigeria) and 4 discoveries (Brazil, Cyprus, Namidia and Surinam).
Challenges
– Sensitivity to oil barrel prices and the dollar, a variation of $0.1 having an impact of $100 million on operating profit, a variation of $10 per barrel having an impact of $2.7 billion;
– Confirmation of expectations for the 2nd quarter: average LNG sales price of $10 to $12/Mbttu and hydrocarbon production of 2.5 Mboe/d;
– After a 12% increase in net profit in the 1st quarter, 2023 outlook for hydrocarbon production up 2%, driven by the start-ups of the Omani, Brazilian and Azerbaijani fields, and by progress in LNG (2 new terminals in Europe) and by a 30% increase in renewable electricity production, all supported by $16 to $18 billion in investments including $5 billion in low-carbon energies;
– Total 2022 dividend of €2.81, forecast of 3 installments in 2023 in the amount of €0.74 following share buybacks for $2 billion in the 2nd quarter, triggered according to the formula 40% of the cash flow generated by hydrocarbon prices above $60 per barrel.
Find out more regarding the “oil and oil services” sector
Biogas to green activities
Obtained through the decomposition of waste, it falls into the category of green energy. It is part of the strategy of many countries, particularly in Europe, to reduce their dependence on hydrocarbon imports. Oil groups have strong ambitions in the field, as two recent operations reveal. The British BP took over the American Archaea Energy for 4.1 billion dollars. Then, the Anglo-Dutch Shell announced the acquisition of the Danish Nature Energy for $2 billion. These operations display high valuation levels, highlighting the strong potential of the sector. TotalEnergies had already taken a stake in the American Clean Energy Fuels Corp in 2018, of which it now holds 19%. It recently joined forces with Veolia to recover biomethane from waste treatment facilities.
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