PARIS: French energy giant TotalEnergies has announced plans to increase its oil and gas production until 2030, as it seeks to reassure investors about its fundamentals.
CEO Patrick Pouyanne has a raft of ambitious projects aimed at propelling growth through the decade, not least a $10 billion offshore investment in Suriname that received a green light Tuesday.
The company on Wednesday attempted to buoy investors at its annual strategy and outlook meeting in New York, as energy prices have fallen since Russia’s invasion of Ukraine in 2022.
TotalEnergies raised its growth forecast in oil and gas production to around three percent a year until 2030, led by liquefied natural gas (LNG), and after the launch of six major projects this year in Brazil, Suriname, Angola, Oman and Nigeria, according to a company statement.
LNG is highly coveted in Asia and by Europeans, who have sought to compensate for the drastic drop in Russian deliveries by land since the war in Ukraine began.
The firm’s forecast is up from the previous target of two to three percent per year until 2028.
To justify the prolonged rise, Pouyanne pointed to the natural decline of oil field production and the rise in global demand for oil.
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“So we need to continue to invest in oil,” he said, adding that for now, low-carbon technologies were not penetrating the market significantly.
TotalEnergies said it intends to develop flexible renewable electricity from wind and solar, aiming to produce more than 100 Terrawatt hours of electric energy by 2030, with 70 percent coming from renewable sources.
OPEC sees demand for oil increasing significantly by 17 percent between 2023 and 2050, contrary to the efforts required to limit global warming and the forecasts of the International Energy Agency, which predicts demand for all fossil fuels – oil, gas and coal – to peak before 2030.
After TotalEnergies’ record profits in 2022 and 2023, as prices spiked in the wake of Russia’s invasion of Ukraine, this year could mark a return to normalcy.
The group intends to reward shareholders with an $8 billion share buyback, just as the French government is considering taxing such operations to replenish dwindling state coffers.
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