French oil major Total booked an increase in quarterly profit despite a lower price environment as its production grew during the period fueled by new project startups and rampups.
Patrick Pouyanné, Chairman and CEO of Total. Source: Wikimedia; Author: Jérémy Barande – under the CC BY-SA 2.0 license
Total’s adjusted net income in 4Q 2019 was $3.2 billion, stable compared to last year thanks to the stable adjusted net operating income of the segments. Adjusted net income excludes the after-tax inventory effect, special items and the impact of effects of changes in fair value.
Total recorded a net income of $2.6 billion in the fourth quarter 2019 compared to $1.13 billion in the same period of 2018.
Total posted a net income of $11.3 billion in 2019, a 2% decrease compared to 2018.
Total Chairman and CEO, Patrick Pouyanné , said: “The group reported solid fourth quarter 2019 results with cash flow (DACF) of $7.4 billion, an increase of more than 20% compared to the fourth quarter 2018, and adjusted net income stable at $3.2 billion, despite a lower price environment.
Hydrocarbon production was 3,113 thousand barrels of oil equivalent (kboe/d) in the fourth quarter 2019, an increase of 8% compared to last year, due to a 13% increase related to the start-up and ramp-up of new projects, including Yamal LNG in Russia, Egina in Nigeria, Ichthys in Australia, Kaombo in Angola, Culzean in the United Kingdom and Johan Sverdrup in Norway.
This was offset by 3% due to the natural decline of the fields and by 2% due to maintenance and Tyra redevelopment project in Denmark.
The company’s total hydrocarbon production in 2019 was 3,014 kboe/d, an increase of 9% compared to 2018.
According to Total, the environment remains volatile, given the uncertainty about hydrocarbon demand related to the outlook for global economic growth and a context of geopolitical instability.
The group has strong capacity to generate cash flow and, in a $60/b environment, expects to increase it by approximately $1 billion per year starting from 2019.
Spending discipline is maintained and the group continues its cost reduction program with an objective of more than $5 billion in cumulative savings in 2020. Net investments in 2020 should be on the order of $18 billion, and the group will complete its $5 billion asset sale program over the years 2019-2020, with $3 billion already announced.
Offshore Energy Today Staff
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