French energy giant Total plans to reduce its expenditure by $2 billion by 2023, Patrick Pouyanne, CEO of the company said on Wednesday.
Pouyanne, who presented Total's strategy and outlook to the financial community, said cost reduction efforts would be accelerated in consideration of short-term uncertainty and the low price environment.
Consequently, he said the company’s capital investment for 2021 should be under $12 billion.
“In the current uncertain environment, Total remains focused on what it controls and specifically on the pillars that enable the Group to resist the crisis,” the company said in a written statement.
Total said that it would grow its upstream production by an average rate of 2% per year from 2019 through to 2025, but mainly between 2022 and 2025.
It estimated that its energy production would grow by one third, roughly from 3 to 4 million barrels of oil equivalent per day, half from LNG, half from electricity, mainly from renewables over the next decade. The company aims to scale up profitable investments in renewables and electricity from $2 billion to $3 billion per year, representing more than 20% of capital investments.
Reiterating its commitment to its ambition to achieve net-zero emissions by 2050, the company said it would reduce oil product sales by almost 30% so its sales mix will become 30% oil products, 5% biofuels, 50% gases, and 15% electrons over the next decade.
The company predicts that its LNG sales will reach 50 metric tons per year by 2025 and will double over 2020-30. It also forecasts that its cash flow from its integrated LNG business will grow by 40% to more than $4 billion in 2025 based on $50 ber parrel.
The company said it would further cement its climate ambition by decarbonizing natural gas with biogas and hydrogen as well as continuing to reduce methane emissions.
By Sibel Morrow