Slide 1: Outlook & objectives
2014 Outlook & objectives September 2014 2014 Outlook & objectives – total.com 1
Slide 2: Market environment
Market environment ZONE D’IMAGE 2014 Outlook & objectives – total.com 2
Slide 3: Evolving energy mix
Evolving energy mix Energy mix Mboe/d +21% 3% Hydro 5% Solar, wind, other Growing long term demand 300 10% Biomass led by emerging countries 6% Nuclear 22% Coal Diversified energy mix 200 • Oil to remain primary energy source • Gas to replace coal as 2nd energy source 25% Natural gas • Rapid growth
Slide 4: Industry challenge to satisfy oil demand
Industry challenge to satisfy oil demand Oil supply-demand Mb/d Oil demand Continued long term growth in oil +0.6% demand, despite increased energy CAGR efficiency Marginal supply requires high technology, continuous innovation North and significant investment America Decline ~50 Mb/d of Geopolitica
Slide 5: Strong growth in LNG demand
Strong growth in LNG demand LNG supply-demand Mt/y LNG demand +5% Demand mainly driven by Asian growth CAGR 500 Potential RoW Need to double current supply by 2030 projects Russia Africa 40% of potential projects in new LNG North America producing countries Sanctioned 250 Attractive long term pricin
Slide 6: Challenging cost environment
Challenging cost environment Rising costs UCCI and UOCI* Brent Inflation lower but current cost levels Base 100 in 2000 $/b unsustainable Capital discipline and project selectivity critical Systematic response from Total • Disciplined capital allocation • Controlling Capex • Opex reduction program 2
Slide 7: Outlook
Outlook ZONE D’IMAGE 2014 Outlook & objectives – total.com 7
Slide 8: Safety, a core value
Safety, a core value Improving safety performance while increasing activity 530 Million man-hours 450 1.6 TRIR 0.9 LTIR Significant and steady decrease in injury rates • 2013 TRIR: -57% vs 2008 • 2013 LTIR: -56% vs 2008 Shared safety standard for employees and contractors Priority to safety not comp
Slide 9: Improving environmental performance
Improving environmental performance Energy efficiency Annual improvement target of 1.5% Continuous flaring Discharges to water Mm3/d kt, onshore and coastal 15 0.4 2013 2013 2005 2014 target 2011 2017 target Close to achieving target On track to reduce discharges to reduce flaring by 50% to water by
Slide 10: Prioritizing cash flow generation
Prioritizing cash flow generation Free cash flow* B$ Transitioning from intensive investment to cash flow generation 15 Growing cash flow from operations Upstream • Cash accretive Upstream start-ups net growth 10 • Increased contribution from Downstream, Downstream in a weaker European environment r
Slide 11: Transforming Total's profile by 2017
Transforming Total’s profile by 2017 Upstream share of Production growth capital employed Mboe/d 80% 2017 2.8 2017 On course in all segments to change 2007 2007 the Group’s profile by 2017 • Upstream start-ups driving growth in cash flow • R&C restructuring to improve profitability R&C European M&S
Slide 12: Upstream
Upstream ZONE D’IMAGE 2014 Outlook & objectives – total.com 12
Slide 13: Committed to stronger performance in Upstream
Committed to stronger performance in Upstream Capital discipline Project execution Cost reduction • Strict selection criteria • Delivering projects • Retaining top-tier position for new projects on-time and on-budget in technical costs • Portfolio management • Growing production • Reducing Opex and
Slide 14: Creating value through capital discipline
Creating value through capital discipline Leveraging Kaombo experience for future projects 20 B$ Promoting “good enough” designs 0.75 B$ 16 B$ Optimizing contractual strategy 0.5 B$ From local content to in-country value Sanctioning projects at 100 $/b and assessing short plateau projects at 80 $/b
Slide 15: Strong project management track record
Strong project management track record Schedule and budget performance from sanction to start-up for Total operated projects* % variation Budget Industry facing delays and cost overruns Implementing solutions to retain competitiveness 10% Average Usan Akpo • Minimize change orders post-sanction CLOV
Slide 16: Reducing Opex in a leaner Upstream
Reducing Opex in a leaner Upstream 2015-17 Upstream Opex reduction Contribution to operating results M$ 800 Other Major bottom-up efforts from all affiliates Supply chain 75% from top-5 affiliates Technical 400 15% cost reduction on operated assets Contribution starting 2015 Structure costs Designed
Slide 17: Building on a new wave of start-ups
Building on a new wave of start-ups Laggan- Offshore installations and pipelines complete Status of major projects contributing to 2017 production Tormore Upside from Edradour and Glenlivet 2014-17 start-ups, % EPC progress Start-up CLOV 12 June 2014 Ofon 2 4Q 2014 Laggan-Tormore 1Q 2015 Eldfisk 2 1
Slide 18: New project start-ups fueling cash flow growth
New project start-ups fueling cash flow growth Production Adding 0.6 Mboe/d of cash accretive ~2.8 production from 2014-17 start-ups Mboe/d • ~50 $/boe cash flow from operations 2.3 • 2/3 Total-operated projects 2.1 Mboe/d Start-ups Mboe/d 0.6 Mboe/d • 1/3 deep offshore projects Revised forecast imp
Slide 19: Deep offshore and LNG at the core of Upstream
Deep offshore and LNG at the core of Upstream Industry leader in deep offshore Robust global LNG position IRR* 25 years Peak production (kb/d) Net cash flow (B$) • 10% of Total’s production, • 20% of Total’s production, >25% of 2013 Upstream results >25% of 2013 Upstream results • High tech and high
Slide 20: Completing 2012-14 exploration program
Completing 2012-14 exploration program Main ongoing wells Key 2015 wells 2014-15 unconventional wells Russia South Tambey Qatar Block BC Ivory Coast San Pedro Angola Kwanza Brazil Libra Argentina South Africa Vaca Muerta Block 11B/12B Defining new road map for post 2014 2014 Outlook & objectives – t
Slide 21: Major contributors to post 2017 production
Major contributors to post 2017 production Long plateau project Deep offshore Yamal LNG Fort Hills 450 kboe/d (20%) 180 kb/d (39.2%) Utica 400 kboe/d (25%) Kashagan Ph 1 Surmont* 370 kb/d (16.8%) 255 kb/d (50%) Egina 200 kb/d (24%) Uganda* Elk-Antelope* 230 kb/d (33.3%) 150 kboe/d (31.1%) Libra* 1,4
Slide 22: Downstream
Downstream ZONE D’IMAGE 2014 Outlook & objectives – total.com 22
Slide 23: Redeploying Refining & Chemicals capital
Redeploying Refining & Chemicals capital Refining & Petrochemicals capital employed Lowered European breakeven point B$ thanks to synergies and efficiency programs • ERMI scenario revised to 25 $/t 15 Ongoing reduction of European exposure Asia, • 2011-14 capital employed reduced by 30% Middle East
Slide 24: Delivering profitability target as planned
Delivering profitability target as planned Synergies Efficiencies 12% with +2.5% 13% ERMI 25 $/t Portfolio changes +2.5% 11.5% target 2014 Major projects Specialty on main chemicals 10% in 2013 platforms +0.5% +1.5% 6% Port Arthur Cepsa Normandy Dunkirk 400 M$ Qatar Resins in 2014 out Satorp Fertili
Slide 25: Creating value in Marketing & Services
Creating value in Marketing & Services M&S share of capital employed in growth areas excl. New Energies 70% Investing to expand and rebalance M&S • Organic Capex peaking in 2014 • Repositioning toward growth areas and adapting in Europe 2012 2013 2017 Growing while generating high profitability • Ta
Slide 26: Corporate
Corporate ZONE D’IMAGE 2014 Outlook & objectives – total.com 26
Slide 27: Capex control and capital efficiency
Capex control and capital efficiency Group organic Capex Transitioning out of an intensive 28 B$ investment phase 26 B$ 25 B$ 24 B$ Under Optimizing Capex to meet strict study investment criteria Producing and Better capital allocation through sanctioned asset sales and cancelled projects Downstream
Slide 28: 2 B$ Opex savings by 2017
2 B$ Opex savings by 2017 2015-17 Opex reduction Contribution to operating results and cash 2 B$ Corporate M&S 1.4 B$ Necessary initiative in all segments R&C Quick wins yielding 40% of total savings starting 2015 Upstream Opex savings of 4 B$ cumulative over 3 years 2015 2016 2017 Operating results
Slide 29: Reshaping portfolio and unlocking value
Reshaping portfolio and unlocking value 2010-to-date asset sales Simplifying portfolio High-grading portfolio embedded into Group strategy Monetizing non-core Adapting assets Successfully implementing asset sales downstream • Strong valuation track record Other • 16 B$ since 2012, well within 2012-1
Slide 30: Strong balance sheet maintained through intensive investment period
Strong balance sheet maintained through intensive investment period Strong balance sheet Share of non-producing assets B$ in total capital employed Net debt 50% 25% Equity Gearing 23% 22% 23% 27% 2007 2010 2014 2017 2011 2012 2013 June 2014 20-30% target range for gearing Non-producing capital emplo
Slide 31: Committed to competitive shareholder return
Committed to competitive shareholder return Competitive track record for increasing dividend €/share 2.38 Dividend doubled over the past 10 years x2 Steady dividend increase through Brent and investment cycles 1.18 Dividend policy 50% average payout ratio Buying shares to mitigate dilution from empl
Slide 32: Conclusion
Conclusion ZONE D’IMAGE 2014 Outlook & objectives – total.com 32
Slide 33: Staying the course to transform Total
Staying the course to transform Total Safety, a core value Addressing macroeconomic changes and a challenging geopolitical context Implementing our strategy • Growing Upstream and improving efficiency • Strengthening R&C profitability • Expanding and rebalancing M&S Creating value through capital di
Slide 34: Appendix
Appendix ZONE D’IMAGE 2014 Outlook & objectives – total.com 34
Slide 35: Six major platforms shaping the future of R&C
Six major platforms shaping the future of R&C Port Arthur Daesan • 90% ethane and LPG • New condensate cracked in 2014 splitter and aromatic • Connected to domestic units started-up ahead supply infrastructure of schedule (July 2014) • Ethane cracker project Normandy Antwerp Satorp Qatar • Moderniza
Slide 36: Portfolio of major projects
Portfolio of major projects Capacity Production Project Country Project (kboe/d) Share Op Status 2014 CLOV Angola Deep offshore 160 40% Prod. Ofon 2 Nigeria Liquids/gas 70 40% Dev. West Franklin Ph.2 UK Gas/cond. 40 46.2% Dev. Laggan-Tormore UK Deep offshore 90 80% Dev. Eldfisk 2 Norway Liqu
Slide 37: Disclaimer
Disclaimer This document may contain forward-looking information on the Group (including (ii) Inventory valuation effect objectives and trends), as well as forward-looking statements within the meaning of the The adjusted results of the Refining & Chemicals and Marketing & Services segments Private