Slide 1: Strategy & Outlook
Strategy & Outlook September 2016
Slide 2: 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
Slide 3: Keep improving efficiency and preparing the future
Keep improving efficiency and preparing the future Leveraging integrated business model Tackling short term challenges Positioning Total strongly for the medium term Creating long term shareholder value 2016 Strategy & Outlook 2
Slide 4: Continued volatility as oil market rebalances
Continued volatility as oil market rebalances Industry investments reduced from 700 B$ in 2014 to 400 B$ in 2016 Short term supply-demand and OECD inventories Supply-demand outlook to 2020 Mb/d Mb/d 5 5-10 Mb/d unidentified 100 4 Supply Demand 95 3.1 Bb Commercial 4 stocks 5% decline New supply 3 ~2
Slide 5: Overcapacity impacting short term gas prices
Overcapacity impacting short term gas prices Long term outlook for gas and LNG remains favorable Gas prices Gas supply-demand $/Mbtu Bcm 20 +2% per year 4,000 15 to be sanctioned shale 10 sanctioned 3% Decline New supply ~500 ~900 5 2,000 2013 Aug 2016 2020 2025 Asian spot NBP HH Source Total estima
Slide 6: Tackling short-term challenges
Tackling short-term challenges ► Being excellent at everything we can control ► Safety, Delivery, Cost and Cash
Slide 7: Safety, a core value
Safety, a core value Cornerstone of operational excellence Establishing one central and global 345 HSE organization A powerful tool with 230 experienced staff to be even more effective across whole organization Continuing to improve safety and environmental performance in all segments consecutive da
Slide 8: Increasing Opex savings from 3 B$ to 4 B$
Increasing Opex savings from 3 B$ to 4 B$ Locking in sustainable efficiencies 2015-18 Opex reduction B$ 4 B$ >3 B$ Corporate >2.4 B$ Downstream 1.5 B$ Upstream Achieved 2016 2017 2018 2015 2016 Strategy & Outlook 7
Slide 9: Total Global Services, new source of efficiency
Total Global Services, new source of efficiency Service provider to business units IT (2013) Facility Creating new economies of scale management Accounting across the Group Total Global Services IT savings of 100 M$ already secured HR Purchasing processes Increasing joint procurement from 2 B$ to 15
Slide 10: Committed to strong Capex discipline
Committed to strong Capex discipline Sustainable Capex level from 2017 Capex, including resource renewal Upstream costs, Brent price B$ Base 100 in 2010, $/b $/b 18-19 B$ 15-17 B$ 100 -30% 50 0 2016 2017-20 2006 2008 2010 2012 2014 2016 Previous guidance: <19 B$ 17-19 B$ Upstream Capital Cost Index
Slide 11: Capturing deflation and simplifying design
Capturing deflation and simplifying design Zinia 2: marginal deep offshore field made profitable Reducing costs on Zinia 2 B$ -50% Simplifying subsea layout 2.8 B$ 2.8 Taking advantage of market effect Design 1.4 B$ Market Optimizing project execution and drilling effect Execution Improving fiscal t
Slide 12: Strong production growth
Strong production growth Average growth of 5% per year 2014-20 Production Mboe/d +1-2% per year +5% post-2020 per year 2014-20 9 start-ups in 2015 >4% +9% 4 projects already started up in 2016 2.35 >10 projects under construction 2.15 ~50% of production from long plateau in 2020 Including Yemen LNG
Slide 13: Focusing on cash generation
Focusing on cash generation Operational excellence and project delivery CFFO Downstream CFFO from Upstream start ups from 2015 B$ B$ 10 +2.5 B$ 10 >7 B$ 2012 2016 2017 2020 ERMI ($/t) 36 35 Brent ($/b) 60 60 NBP ($/Mbtu) 5.5 5.5 Maximizing value of existing assets Project delivery fueling Upstream C
Slide 14: Outperforming peers in first half 2016
Outperforming peers in first half 2016 Strong performance across all segments Adjusted net income - B$ Return on Equity 4 10% Cash flow from operations before working capital Upstream production growth* changes* 5.00% 5% -20% -50% -2.00% -2% * % change first half 2016 / 2015 Total, BP, Chevron, Exxo
Slide 15: Positioning Total strongly for the medium term
Positioning Total strongly for the medium term ► Lowering breakeven of oil portfolio ► Expanding along gas value chain ► Capitalizing on customer-focused culture ► Developing low-carbon energy business
Slide 16: Oil, positioning Upstream on low cost assets
Oil, positioning Upstream on low cost assets Managing the portfolio to reduce breakeven Adding low cost assets Reducing exposure on high cost assets Al-Shaheen, 90 kb/d* Qatar, Total 30% Giant conventional offshore oil field Fort Hills, 10% divested in 2015 Canada Oil sands ADCO, 160 kb/d* UAE, Tota
Slide 17: Oil, focusing Downstream on best-in-class assets
Oil, focusing Downstream on best-in-class assets Consolidating 7 B$ cash flow from operations and ROACE >20% Building on Downstream strength Restructuring Downstream base Satorp Saudi Arabia, Total 37.5% World-class, delivering as expected -20% European R&C capacity Achieved end-2016 Daesan Carling,
Slide 18: Growing integrated gas, Upstream
Growing integrated gas, Upstream Diversified portfolio of gas developments Yamal LNG - Russia West of Shetlands - UK Total 20%, 130 kboe/d* Total 60%, 50 kboe/d* Ichthys LNG - Australia Barnett - United States Total 30%, 110 kboe/d* Total 100%**, 80 kboe/d* * Plateau production, Total share (SEC) **
Slide 19: Growing integrated gas, Downstream
Growing integrated gas, Downstream Capturing margin along full value chain Marketing efforts to access new customers Launching 1 Mt/y ethane side cracker at Port Arthur Developing LNG customer base Expanding B2B and B2C marketing Expansion opportunity with low-cost gas feedstock 2016 Strategy & Outl
Slide 20: Capitalizing on customer-focused culture
Capitalizing on customer-focused culture M&S growing retail and lubricants at 4% per year #2 in retail outside North America Retail network Number of retail stations, Total and peers* Lubricants 30,000 >4 million clients per day Present in 130 countries * Total, BP, Chevron, ExxonMobil, Shell Retail
Slide 21: Developing a profitable segment in low-carbon business
Developing a profitable segment in low-carbon business Dedicated organization to grow gas and renewables ~5% of 2016 capital employed Developing downstream gas markets Gas and power Solar marketing 3 B$ 0.5 B$ Building an integrated business in fast growing solar Gas and power Energy storage, key to
Slide 22: Implementing strategy through portfolio management
Implementing strategy through portfolio management Asset sales & acquisitions $B Aligning asset base with ambition in oil, 5 gas and renewables Monetizing non-core assets Fort Hills FUKA Geosel Atotech Saft Laggan GAPCO Schwedt ADCO Kharyaga US infra- Lampiris Maintaining strict discipline for acqui
Slide 23: Integrating 2°C roadmap into strategy
Integrating 2°C roadmap into strategy Gradually decreasing the carbon intensity of our production mix Areas of focus to reduce CO2 emissions Bt CO2 Focusing on oil projects with low breakevens 50 s usual ess a Renewable Busin energies Prioritizing gas projects Energy efficiency 2°C s Optimized Exiti
Slide 24: Creating shareholder value
Creating shareholder value ► To be the most profitable European integrated major
Slide 25: Reducing cash breakeven
Reducing cash breakeven Cash flow B$ 30 80 $/b 2016 cash flow breakeven at 60 $/b including 50 $/b 2 B$ net asset sales CFFO covering 2017 Capex (including resource renewal) and dividend cash-out at 55 $/b 2016 2017 2020 Ending discounted scrip dividend in 2017 with Brent at 60 $/b Brent ($/b) 45 60
Slide 26: Priority to profitability and strong balance sheet
Priority to profitability and strong balance sheet Resilient to volatile price environment Net debt-to-equity ratio % 30% Targeting ROE >10% at 60 $/b Long term gearing guidance of 20% Buyback scrip shares 2014 2015 June 2016 Brent 99 $/b 52 $/b 40 $/b 2016 Strategy & Outlook 25
Slide 27: Attractive return in a volatile market
Attractive return in a volatile market 5.8% dividend yield over past 12 months Total and peers share price with dividend reinvested and Brent Base 100, January 2013 100 Peers* Brent Jan 2013 Jan 2014 Jan 2015 Jan 2016 Aug 2016 * BP, Chevron, ExxonMobil, Shell 2016 Strategy & Outlook 26
Slide 28: Keep improving efficiency and preparing the future
Keep improving efficiency and preparing the future Leveraging integrated business model Tackling short term challenges Positioning Total strongly for the medium term Creating long term shareholder value Committed to shareholder return 2016 Strategy & Outlook 27
Slide 29: Exploration & Production
Exploration & Production
Slide 30: Growing Upstream value
Growing Upstream value Maximizing returns from existing assets Operational excellence Cost discipline Profitability & cash 2016 Strategy & Outlook 29
Slide 31: Improving operational performance
Improving operational performance Sustained efficiency gains across our operations Production efficiency* – operated assets West Africa deep offshore drilling % Non-productive time % 95% ~4% -25% 17.8 16.0 90% 13.4 85% 10 2014 2015 YTD 2016 2017 2014 2015 2016 YTD * Actual production divided by capa
Slide 32: Further driving down E&P Opex
Further driving down E&P Opex Reinforcing competitive advantage on costs Operating costs (ASC932) Operating costs (ASC932) for Total and peers $/boe $/boe 20 9.9 10 -50% Chevron 7.4 Shell ExxonMobil ~6 ~5 10 BP 2014 2015 2016 2018 2010 2011 2012 2013 2014 2015 2016 Strategy & Outlook 31
Slide 33: Cementing a lean cost culture
Cementing a lean cost culture Systematic and disciplined approach delivering sustainable results Consistently challenging our processes 2014-16 UK opex savings Setting global best practices Supply Chain • Angola FPSOs joint operating model: -100 M$ Streamlining maintenance processes • Less works con
Slide 34: Capturing further cost deflation in 2016
Capturing further cost deflation in 2016 Examples of reductions achieved through renegotiation and new tenders -60% -50% -40% -30% -20% -10% 0% Marine logistics Seismic acquisition Well services Sept 2015 Rigs Sept 2016 Rotating equipment Subsea services Tubulars Operations & maintenance Engineering
Slide 35: Delivering project start-ups
Delivering project start-ups >900 kboe/d from start-ups and sanctioned projects Yamal LNG Fort Hills Termokarstovoye West of Shetlands Martin Linge Surmont 2 West Franklin 2 Eldfisk 2 Kashagan Tempa Rossa Timimoun Egina Ofon Ph 2 2015-2016 Moho 2017+ Lianzi Dalia Ph1a Ichthys LNG Incahuasi Angola LN
Slide 36: Al Shaheen – redeveloping giant mature field
Al Shaheen – redeveloping giant mature field Total 30%, Qatar 25-year concession effective mid-2017 300 kb/d, long plateau Low breakeven oil project, free cash flow positive from year one Maximizing oil recovery through reservoir expertise and technical know-how 2016 Strategy & Outlook 35
Slide 37: Yamal – delivering worldclass LNG project
Yamal – delivering worldclass LNG project Total 20%, Russia 16.5 Mt/y capacity, 3 LNG trains >95% of LNG committed Targeting start-up by end-2017 • First train ~80% complete • >90% of wells drilled for start-up >18 B$-equivalent project financing secured 2016 Strategy & Outlook 36
Slide 38: Libra – unlocking deep offshore value
Libra – unlocking deep offshore value Total 20%, Brazil 3-4 Bb resources in North West panel alone with excellent well productivity Start-up of 50 kb/d EWT vessel in 2017 Phased development with FID of first FPSO planned in 2017 2016 Strategy & Outlook 37
Slide 39: Uganda – advancing giant onshore field
Uganda – advancing giant onshore field Total 33% Uganda Hoima Agreement on export pipeline route Kampala through Tanzania Nairobi 25-year production license awarded Kenya Lamu Moving toward FID, capturing deflation Tanzania Tanga 2016 Strategy & Outlook 38
Slide 40: Gas, Renewables & Power
Gas, Renewables & Power
Slide 41: From gas to power
From gas to power Gas, renewable and power markets becoming more integrated Global power generation, source IEA TWh 1.5% CAGR 30,000 Gas becoming largest primary source Solar Wind of power Biofuels Hydro Renewables growing by >10% per year Nuclear New market trends Gas • Energy efficiency Oil • Dist
Slide 42: Developing a complementary portfolio
Developing a complementary portfolio Building on a base of quality assets ~5% of 2016 capital employed Gas and power Solar marketing 3 B$ Global trading for gas and LNG 0.5 B$ Gas and power B2B marketing in Europe and Lampiris platform for B2C Gas and power trading Energy 1.5 B$ High quality SunPowe
Slide 43: Growing integrated gas portfolio
Growing integrated gas portfolio Capturing full value chain margin Integrated gas portfolio Bcm/y +20% x2 x2 +50% +70% 80 Gas representing half of Group reserves Growing portfolio, developing new markets • Signed 2 Mt/y long term LNG contracts in 2016 40 • Offering more flexibility to customers • Pr
Slide 44: Unlocking new LNG demand
Unlocking new LNG demand Opening new markets Floating Storage Regasification Units (FSRU) LNG new markets World overview Mt/y 150 Africa Middle East Southeast Asia Latin America Existing Under construction Proposed 2010 2015 2020 2025 Source Total estimates FSRUs enabling new LNG markets Successive
Slide 45: Expanding gas and power marketing
Expanding gas and power marketing Growing demand for combined offering Growing presence in European B2B and B2C Number of B2B sites supplied 800,000 >x7 2012 2015 2020 Existing Developing B2C 2016 Strategy & Outlook 44
Slide 46: SunPower, a high quality platform in solar
SunPower, a high quality platform in solar Leading integrated player Decentralized power generation #2 in US residential Solar cell and panel production Deploying 350-450 MW in 2016 12% market share Power plant design, construction and operation Wide range >1 GW 25% 1.3 GW of products in development
Slide 47: Energy storage, key to growing profitable renewables
Energy storage, key to growing profitable renewables Solid cash generation to boost future growth Saft 2015 cash flow allocation M$ 110 Other 100 years of history 850 M$ revenue in 2015 Dividend and • Leadership on >75% of revenue base buybacks CFFO • 9% invested in R&D, 3 main technologies Free cas
Slide 48: Adapting pace of growth to deliver profits
Adapting pace of growth to deliver profits Leveraging integrated portfolio to maximize value Cash flow from operations B$ 1 Expanding downstream gas Building a profitable business in fast growing renewables 1 B$ CFFO per year by 2020 2016 2020 2016 Strategy & Outlook 47
Slide 49: Disclaimer
Disclaimer This document may contain forward-looking information on the Group (including objectives and (ii) Inventory valuation effect trends), as well as forward-looking statements within the meaning of the Private Securities The adjusted results of the Refining & Chemicals and Marketing & Service