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France: Total Allocates Billions for Upstream in 2012

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French oil major Total said today it intended to continue to actively manage its asset portfolio with, in particular, a program of non-strategic asset sales.

The 2012 budget for organic investments is $24 billion , of which more than 80% will be dedicated to the Upstream.

In the Upstream, Total expects in 2012 to implement its strategy to accelerate production growth and increase the profitability of its asset portfolio.

The ramp-up of Pazflor in Angola and the start-up of several major projects, including Usan in Nigeria, Angola LNG, and Bongkot South in Thailand, will contribute to  production growth in 2012 and to achieving the objective of growing production by 2.5% per year on average between 2010 and 2015.

“The successful start-up of the Pazflor field in Angola was the crowning achievement of an important year for Total. This start-up and the ones to follow will ensure a return to production growth in 2012 and the years to come”, Chairman and CEO Christophe de Margerie said.

After launching Ichthys in Australia, announced at the start of  this year, Total said it intends to continue work on the drivers for post-2015 growth by preparing to launch, notably, projects in West Africa, Russia and Canada.

Income Soars

The Group today announced 2011 adjusted net income of $15.9 billion which is an increase of 17 per cent when compared to full year results from 2010.

Commenting on the results de Margerie said:

“In a period of economic slowdown, ongoing tensions on the global oil supply supported the Brent price above 110 S/b in 2011. This environment has been favorable for the Upstream, but it was difficult for the Downstream activities, notably in Europe. In this context, the Group posted a 17% increase in earnings, expressed in dollars, compared to 2010. With its track record of operational excellence, the Group also confirms its constant improvement in safety performance.”

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Angola LNG Looks to Sell Liquefied Natural Gas to Non-U.S. Buyers

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Angola LNG is on track to deliver its first liquefied natural gas exports in early 2012 and is looking to sell its LNG to non-U.S. buyers after prices there plummeted due to an increase in domestic gas production, a company executive said on Monday.

Our project was based, four years ago, on U.S. sales, but since the LNG market is not very good, we are looking for other opportunities,” Antonio Orfao, chairman of Angola LNG, told Reuters on the sidelines of an industry conference in Perth, Australia.

The 5.2 million tonnes per annum (mtpa) Angola LNG project is led by Angola’s state-owned oil company, Sonangol, which has a 22.8 percent interest and Chevron, which holds 36.4 percent. Eni, Total and BP each hold a stake of 13.6 percent.

Angola LNG’s plans to turn its focus away from U.S. buyers occurs in the wake of a rapid increase in shale gas production brought about by new drilling and extraction technologies which will bring U.S. gas production to a record high this year.

U.S. LNG imports have halved since 2007 with some import terminals re-exporting cargoes as the country’s demand is increasingly met by domestic gas production.

To market its gas, Angola LNG is creating new LNG marketing entity that will look to sell its gas to the most competitive markets, Orfao said, but would not specify which markets Angola LNG was targeting.

We look for the best markets, it can be any place– our team is looking at different options,” Orfao said, adding that although there were no signed sale contracts yet, he expected sale agreements to be made in the next several months.

Rapidly increasing Asian LNG demand and higher prices for the fuel in the region have pulled supplies of the gas from the Atlantic region in the last few months.

Asian spot prices are around $17 per million British thermal units (mmBtu) LNG-AS, compared to the U.S. where prices are around $3.50 per mmBtu.

(reuters)

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