Patrick Pouyanné, chairman and CEO of Total, addressed the Group’s employees on 19 March to mobilise them in the face of the challenges ahead
He recalled the resilience that the Group’s teams demonstrated during the 2015-16 oil crisis as well as the two pillars of the Group’s strategy which are the organic pre-dividend breakeven of less than US$25 per barrel and the low gearing to face this high volatility.
In a context of oil prices on the order of US$30 per barrel, he announced an action plan to be implemented immediately based on the following three axes:
-Organic Capex cuts of more than US$3bn, ie. more than 20 per cent, reducing 2020 net investments to less than US$15bn. These savings are mainly in the form of shortcycle flexible Capex, which can be arbitrated contractually over a very short time period;
-US$800mn of savings in 2020 on operating costs compared to 2019, instead of the US$300mn previously announced;
-Suspension of the buyback programme – the company announced a US$2bn buyback for 2020 in a US$60 per barrel environment; it bought back US$550mn in the first two months.
The attached link allows access to Patrick Pouyanné’s address to the Group’s employees as well as a presentation of the action plan:
-Message from Patrick Pouyanné to workforce
-Presentation of the action plan at US$30 per barrel
Patrick Pouyanné will intervene during the First Quarter 2020 conference call on 30 April 2020.