Total slipped to a full-year consolidated net loss of $7.34 billion as the French supermajor felt the effects of the coronavirus on oil markets, while it is targeting gas and renewables in an energy transition drive that looks set to include a name change.
The Paris-based giant managed, however, to stay in the black in the fourth quarter despite a drop in production, in large part due to Opec+ curtailment quotas.
Total has been one of the earliest and most significant movers among oil majors in terms of renewable energy investments, and the company has vowed to transform itself this decade.
The growth in energy production out to 2030 will be based on the two pillars of liquefied natural gas and renewables plus electricity, it said on Tuesday.
As a result, oil products are expected to fall from 55% to 30% of sales in the decade.
To highlight the changing nature of the business, the company will propose at its annual general meeting in May that the name be changed to TotalEnergies.
Total's $7.34 billion full-year consolidated loss came as it ran up depreciation, depletion and impairment charges of $22.26 billion during the year. The consolidated net profit in 2019 was $11.44 billion.
Revenues from sales sank to $119.7 billion from $176.25 billion as the coronavirus pandemic hammered oil demand and commodity prices.
For the fourth quarter last year, Total posted consolidated net income of $903 million, down from $2.65 billion in the final period of 2019.
Revenues from sales were $32.35 billion in the final period of 2020 as against $43.39 billion a year earlier.
Production for the year averaged 2.87 million barrels of oil equivalent per day, down 5% from the 3.01 million boepd in 2019. Some 5% of this drop was due to compliance with quotes in Opec+ — a grouping of Opec and other major producers, such as Russia, that agreed to curtail output in an effort to buoy oil prices.
Natural field declines and maintenance and unplanned outages accounted for another 5% of a drop, with a 5% increase due to ramp-ups, notably at Culzean off the UK, Iara in Brazil, Johan Sverdrup off Norway, Tempa Rossa in Italy and North Rosskoye in Russia.
For the fourth quarter, production averaged 2.84 million boepd, a 9% fall from the 3.11 million boepd taken in the fourth quarter of 2019. Again, Opec+ quota compliance accounted for 5% of the fall, notably in Kazakhstan, Nigeria and United Arab Emirates, as well as voluntary reductions in Canada and disruptions in Libya.
Despite oil prices remaining stable and relatively strong so far this year, Total said "the oil environment remains uncertain and dependent on the recovery of global demand, still affected by the Covid-19 pandemic".
It added that, in the context of disciplined Opec+ quota compliance, group production is expected to remain stable this year, benefiting from a resumption in Libya.
LNG sales are expected to surge by 10% this year over 2020, notably due to a ramp-up at the Cameron LNG project in the US.
Net investments this year are set to come in at $12 billion, with Total targeting additional savings of $500 million in the year after reducing operating costs last year by $1.1 billion over 2019.
The company will allocate more than 20% of its net investments this year to renewables and electricity.