France’s Total Chairman & CEO Patrick Pouyanné announced an immediate action plan to be implemented in light of the sharp drop in oil prices.
Pouyanné addressed the Group’s employees on March 19 to mobilise them in the face of the challenges ahead.
In a context of oil prices on the order of $30 per barrel, he announced an action plan to be implemented immediately based on the following three axes:
- Organic Capex cuts of more than $3 billion, ie. more than 20 per cent, reducing 2020 net investments to less than $15 billion. These savings are mainly in the form of shortcycle flexible Capex, which can be arbitrated contractually over a very short time period;
- $800 million of savings in 2020 on operating costs compared to 2019, instead of the $300 million previously announced;
- Suspension of the buyback program – the company announced a $2 billion buybackfor 2020 in a 60 $/b environment; it bought back $550 million in the first two months.