July 30, 2020 Read More →

Total takes $8.1 billion charge largely due to Canadian oil sands investments

Reuters:

France’s Total said on Wednesday it will take an $8 billon impairment on the value of its assets, mainly in energy-intensive Canadian oil sands projects after the energy group slashed its oil and gas price outlook.

The write down follows similar steps by many major oil and gas companies including Royal Dutch Shell and BP in recent weeks in the wake of the collapse in fuel consumption due to the coronavirus epidemic.

Total, which reports second quarter results on Thursday, sharply lowered its short-term price outlook, leading to a $1.5 billion impairment of its Canadian assets and an $800 million impairment of Australian liquefied natural gas (LNG) facilities.

Canada’s oil sands require complex and energy-intensive extraction processes that cause heavy carbon pollution. BP’s $17.5 impairment last month also included prospects in Canada.

Paris-based Total, which recently announced plans to sharply reduce its greenhouse gas emissions, wrote down a further $5.5 billion in the value of its Fort Hills and Surmont Canadian oil sand projects after cutting its long-term price.

Total will also stop investing in capacity expansion projects in Canadian oil sands, it said. It decided to withdraw from the Canadian Association of Petroleum Producers (CAPP), saying the association is not aligned with Total’s positions.

[Bate Felix and Ron Bousso]

More: France’s Total writes down $8 billion on weaker oil, gas outlook

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