TotalEnergies SE has insisted it is committed to reducing emissions as it plans to increase oil and gas production by up to three percent over the next five years.
“The oil and gas business is expected to generate more than $3 billion of additional underlying cash flow in 2028 compared to 2023 at constant prices,” the French energy giant said in a press release issued on Wednesday on your website.
TotalEnergies said it aims to increase production by two to three percent over the next five years, most of which would be liquefied natural gas (LNG), which is considered to have lower emissions than other fossil fuels. “The company will notably develop a first-class pipeline of LNG projects (Qatar North Field Expansion, Papua LNG, ECA LNG and Rio Grande in the US, Mozambique LNG) while leveraging its competitive advantage with leading positions in European regasification and American exports”. , he said.
“TotalEnergies will also concentrate efforts on developing its portfolio of highly profitable oil projects (Brazil, Gulf of Mexico, Iraq, Uganda) recently enriched with exploration successes in Suriname and Namibia.”
While growing LNG as part of its energy transition strategy, TotalEnergies plans to increase investment in the power sector amid the eventual switch from oil and gas to ensure profitability. “TotalEnergies is replicating its integrated oil and gas to electricity business model to achieve ROACE [return on average capital employed] of ~12 percent, equivalent to oil and gas ROACE at $60/b [dollars per barrel]above traditional “utility” model returns, the press release said. The company plans to increase its electricity generation to more than 100 terawatt-hours by 2030 with investments of $4 billion annually.
“The company is building a world-class cost-competitive portfolio that combines renewable assets (solar, onshore wind, offshore wind) and flexible assets (CCGT, storage) to deliver clean firm power to its customers,” he said.
TotalEnergies had 19 GW of installed capacity for renewable power generation in July, according to a company press release on September 20 announcing $300 million in equity investment to form an Indian joint venture with Adani Green Energy Ltd. with a wind and solar electricity portfolio of 1,050. megawatts of alternating current. TotalEnergies has set itself the goal of reaching 35 GW of gross renewable energy generation capacity by 2025 and 100 GW by 2030 to achieve net zero emissions by 2050.
To reassure investors, TotalEnergies said in the outlook report that it is “leveraging its purchasing power to optimize its investment costs and industrialize its renewable assets through digital to reduce operating costs.”
“By using its balance sheet of strength, TotalEnergies will capture additional value from price volatility through trader exposure.”
“Thanks to the reorientation of the oil and gas portfolio in assets and projects with low greenhouse gas emissions and balance, and the diversification towards electricity, especially renewable, through an integrated strategy from production to the customer, the company is in a very favorable position to take advantage of changing energy markets and prices,” he said in an earlier press release announcing that his board of directors had reviewed its strategic outlook in a strategic meeting annually on September 20 and 21.
“Therefore, TotalEnergies pursues its ambition to become a major player in the energy transition, committed to carbon neutrality by 2050, together with society,” added TotalEnergies. “As a result, the life-cycle carbon intensity of energy products sold to its customers has been reduced by 12% in 2022 compared to 2015, with the ambition to reduce it by 25% by 2030, and the company is committed to reducing the scope 1+.2 of its oil and gas operations by 40% by 2030 and by 80% for methane.”
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