Left Menu
Development News Edition

Total CEO says governments not oil firms must drive carbon curbs

Reuters | Updated: 11-02-2020 22:32 IST | Created: 11-02-2020 22:32 IST
Total CEO says governments not oil firms must drive carbon curbs

It is up to governments to drive decarbonisation and consumers will have to pay more to achieve carbon neutrality, Total's chief executive said, adding the French firm has no intention of moving away from oil and gas production. Oil firms should not be seen as "villains" amid growing pressure from investors and climate activists, chief executive and chairman Patrick Pouyanne told Reuters at Total's headquarters in the Scottish oil hub of Aberdeen.

Giving up on oil and gas would be "a huge mistake", partly because it pays for investment in green technology, he said, echoing Shell CEO Ben van Beurden who told Reuters last year that it had no choice but to invest in oil and gas.. "Suppose we announced today that we have stopped producing oil, do you think cars will suddenly be driven without gasoline? No, it doesn't work. It is not black and white," he added.

"We don't want to go away from oil and gas. We have all the financial capacities to be in the driving seat (of the energy transition) and not to be the villains of the story," he said. Since Pouyanne, 56, became CEO in 2014 after his predecessor Christophe de Margerie died in a plane crash, Total has introduced targets to cut carbon emissions, although critics say it is still not aligned with the United Nations-backed 2015 Paris climate agreement to limit global warming.

"Society wants to be carbon neutral, but the energy companies will not be carbon neutral," Pouyanne "Maybe it will take 20 years. It will take time, and this will have an impact on demand, so we need to position the company to be ready," Pouyanne said.

Pouyanne said Total will choose at some point whether to abandon oil and gas, but for now fossil fuel profits remain the engine of its growth in renewable and low-carbon energy. Revenue from its largest segment is needed to grow in power markets, electric vehicle charging technologies and biofuels which are less profitable, and in some cases, loss-making.

But as Total's new low-carbon businesses become larger and more profitable, that could change. "At a certain point, we'll probably have to choose; do we insist more on this one or this one. Today we have the financial capacity to look at various axis."

Total, which has rebranded itself in recent years as an energy rather than oil and gas company, is targeting a near ten-fold expansion in renewable power generation by 2025, but Pouyanne said this will not come cheap. "Maybe society wants oil to be green, but to be green that means we are ready to pay for it," he said.

For example, if European governments decided that all domestic flights should have around 2% of biofuels in the jet fuel, it could increase costs for an average French airline company by around 100 million euros ($109 million) a year, which would be passed on to passengers, Pouyanne calculated. Total and rival energy companies had been used as "scapegoats", Pouyanne said, adding that the debate should be about demand not supply.

"Today, car engines consume oil. If tomorrow car manufacturers decide that most of the cars are electric-driven, the demand will just disappear," he added Pouyanne said that while oil and gas account for most of its operations, 50% of Total's activities will focus on gas by 2040, 30% on oil and biofuels and 20% on electricity.

Total's oil and gas production grew 9% last year when net profits reached almost $12 billion, allowing it to boost dividends. And although only 10% of its $17.4 billion investments in 2019 went into renewables, Total has expanded further in recent weeks with projects in Qatar, India and Spain. ($1 = 0.9142 euros)

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)

Download The Devdiscourse News App for Latest News.


TRENDING

OPINION / BLOG / INTERVIEW

Diya Jalao for COVID 19: How Modi put Power Grids and power warriors at risk?

While Prime Minister Narendra Modis staunch supporters are busy in search of hidden science behind the sudden announcement of 9minutes9pm campaign but his ignorance of the actual science has put the nation in another danger. The scientists ...

Energy markets post-COVID 19: Recovery may take time, transition to continue

As oil markets have crashed, the experts believe the oil prices will come down drastically and continue making the energy transition a financial burden for many economies for a couple of years.  However, the market alone was never...

'Diya jalao' for COVID 19: Modi needs to practice his teachings and control fake news on social media

In his video message to the nation on Friday the Prime Minister talks about peoples collective power to win the invincible. However, he has made no concreate efforts to win over the confidence and represent the collective power of the polit...

Tourism post-COVID 19: Lessons learned, out-of-box strategies to ensure the revival

In the pre-COVID 19 period the tourism industry was seen with much hope throughout the world. However, the COVID 19 pandemic has completely paralysed the tourism industry and its dependent sectors. The tourism industry in the post-COVID 19 ...

Videos

Latest News

Reuters Sports News Summary

Following is a summary of current sports news briefs. World Games 2021 moved to retain broadcasters, official scorers CEOWorld Games Birmingham CEO Nick Sellers said they had little choice but to move the 2021 event to 2022 as a clash with ...

Reuters World News Summary

Following is a summary of current world news briefs. Ecuador stores coronavirus victims in giant fridges as morgues fill upEcuadors government has begun storing the bodies of victims of the coronavirus in giant refrigerated containers as hu...

Reuters US Domestic News Summary

Following is a summary of current US domestic news briefs. Trump says thousands of military to be sent to help states battle coronavirusU.S. President Donald Trump said on Saturday the U.S. government would be deploying thousands military p...

At least 19 killed in Mexico gang clash

A gang battle in Mexico has left at least 19 people dead in the northern state of Chihuahua, officials said Saturday. At least five armed clashes have occurred in the Madera community so far this year, local authorities have said.The state ...

Give Feedback