Total Chairman and CEO Christophe de Margerie (pictured) used his IHS CERAWeek keynote to encourage the oil industry audience to change the way oil and gas companies manage their assets. De Margerie discussed how the industry cannot tolerate rising capital expenditures.
With cost usually a huge factor in the success or failure of developments, De Margerie hammered home the point that planning needs to happen before a project really gets off the ground and contractors are chosen for projects.
“Excellence cannot be an excuse for doing anything at any price,” De Margerie said.
Additionally, Total is re-evaluating its own portfolio. In February, Total announced it was exiting offshore Angola block 15/06, opting to sell its 15% non-operating interest to Sonangol for $750 million. De Margerie told press during a Q&A session after his CERAWeek speech that the sale was a way to “rejuvenate” its assets by selling those that are too small, thereby helping the company to invest in other areas.
“We have other things to do in Angola,” De Margerie said. “To get rid of this small asset, it pleases Sonangol, and it is good for us. It’s day to day business.
“We have to manage assets in more active way,” he continued. “For those (assets) with little interest, we get rid of them and sell at best price.”
Indeed, Total does have other things to do in Angola. Its CLOV project in block 17, which it operates with a 40% interest, is due to start production later this year with a capacity for 160,000 b/d. Then there is also the 30%-operated Kaombo project in offshore block 32, which is still under study. Total hopes to utilize hybrid loop technology for multiphase pumping and transport of fluids. In addition, two 100,000 b/d capacity FPSOs will be anchored at the development.
Image: Audrey Leon/OE