Total splashes out in Abu Dhabi after cutting back on UK assets

 
Adam Hignett
THE RECENT rout in oil prices has hit profits at Total, with a headline loss of $5.7bn (£3.3bn) in the fourth quarter announced yesterday.

Like many others in the energy sector, the company is looking to mitigate these losses by cutting back on capital investments, accelerating its cost cutting exercise and selling off $5bn of assets in 2015.

Part of the savings are to be made by halving its capacity Lindsey refinery in Lincolnshire resulting in 180 job losses by the end of the year.

However, chief executive Patrick Pouyanne hailed the renewal of its oilfield concession in Abu Dhabi as a “blockbuster” and did not deny the French oil major may have coughed up $2bn to sign the deal.

Total raised pressure on its rivals when it became the first oil major to sign a deal last month with the Abu Dhabi National Oil Company (ADNOC) for a 10 per cent stake in the emirate’s biggest oilfields.

Asked yesterday if he could confirm the company had paid a signing bonus of $2.2bn to Abu Dhabi for the stake, Pouyanne said: "I won’t reveal the secrets of this contract. But $2bn for two billion barrels, it’s just $1 per barrel, that's not very expensive.”

The fields are expected to reach 1.8m barrels per day from 2017.

“In the pharmaceutical industry, they have blockbusters. This is our blockbuster, and it will last for 40 years,” Pouyanne said.