Total SA in 2017 expects to spend $16-17 billion including resource acquisitions, down from the $20.53 billion spent in 2016 and $28.033 billion spent in 2014.
The firm says its upstream production is set to increase by more than 4% in 2017, supporting its objective to lift production by 5%/year during 2014-20.
As a result of the growth, the sensitivity of Total’s portfolio in 2017 to Brent crude oil prices increases to $2.5 billion for a $10/bbl change. The group says it plans to take advantage of the favorable cost environment by launching about 10 projects over the next 18 months and adding resources to its portfolio.
The refining and chemicals segment, meanwhile, is expected to continue generating stable operating cash flows of about $7 billion/year.
Total says its downstream performance has been strengthened by restructuring and will continue to benefit from its integrated platforms, notably in Antwerp, the US, Asia, and the Middle East. Final investment decision to launch the Port Arthur, Tex., side-cracker is expected to be taken in 2017.
The group’s breakeven price in 2017 is expected to continue dropping, reaching less than $40/bbl pre-dividend.
Fourth-quarter improvement
The firm reported a fourth-quarter 2016 net income of $548 million, better than the $1.626-billion loss it posted in the same quarter a year earlier.
For the full year, the firm recorded net income of $6.196 billion, up from $5.087 billion in 2015.
Hydrocarbon production during fourth-quarter 2016 averaged 2.462 million boe/d, an increase of 4.7% compared with the average in fourth-quarter 2015.
Startups and ramp ups, notably Laggan-Tormore, Surmont Phase 2, Kashagan, Incahuasi, Moho Phase 1b, Angola LNG and Vega Pleyade, accounted for a 7% rise; and the acquisition of an additional 75% interest from Chesapeake Energy Corp. in the Barnett shale in the US accounted for a 1% rise. Natural field decline and maintenance operations shrunk output by 3%.
For the full-year, hydrocarbon production was 2.452 million boe/d, an increase of 4.5% compared with the 2015 level.
Start ups and ramp ups, notably Laggan-Tormore, Surmont Phase 2, Termokarstovoye, Gladstone LNG, Moho Phase 1b, and Vega Pleyade, and Incahuasi accounted for 6% of the increase; while the security situation in Nigeria and Yemen, and wild fires in Canada accounted for a 1.5% decline.
Adjusted net operating income in the upstream segment during the fourth quarter was $1.131 billion, up from $748 million in the year-ago period. For the year, adjusted net operating income was $3.633 billion, down from $4.774 billion in 2015.
Adjusted net operating income in the refining and chemicals segment for the fourth quarter totaled $1.138 billion, up year-over-year from $1.007 billion. For the full year, it was $4.201 billion, a decrease of $4.889 billion from the 2015 level.
