total e&p presentation
DESCRIPTION
Total E&P Presentation to Chamber MembersTRANSCRIPT
Oil Sands Sustainable Development
Jean-Michel Gires President and CEO, Total E&P Canada Ltd
Chamber of CommerceFort McMurray, Alberta
21 January 2011
1 - Fort McMurray – 21 January 2011
2
Population and Growth driving Energy demand
OECD Non-OECD
Energy demandGDPPopulation
Energy demand growth mainly driven by transportation and power generationNeed to limit further energy demand
50
150
250
350
1980 2005 2030(e)
Mboe/d
1.2%
1.8 %
1.8 %
0.4 %
Trillions$ 2005
50
100
150
200
1980 2005 2030(e)
3.6 %
5.3%
2.0%
Average growth per year2005-2030(e)
1 %
2
4
6
8
10
1980 2005 2030(e)
Billions
1.1 %
0.3 %
(purchasing power parity)
Sources: Total estimates
1.5 %
1.8 %
0.5 % 3%3.7%
3.3 %
2.6%
1.4%
-- Fort McMurray – 21 January 2011
3
Solar, Wind, other renewable energiesHydroBiomass excluding biofuels
Nuclear
Coal
Gas
Biofuels
Oil
0
100
200
300
400
2005 2010 2015 2020 2025 2030
Oil & Gas to represent > 50% energy supply in 2030World energy supply
Source: Total estimates. * Million barrels of oil equivalent per day.
Mboe/d*
Fossil energies represent 81% incl. : •Oil : 35%
•Gas : 21%
Fossil energies represent 75% incl.:•Oil : 30%
•Gas : 22%
Efficient CO2 emissions management and diversification of energy supply are key issues
-- Fort McMurray – 21 January 2011
Significant hydrocarbon resources yet to be produced
Total estimates
Oil resources Gas resources
Conventional gas resources concentrated in Russia, Iran and QatarDevelopment of shale gas production in the US driving a reevaluation of unconventional gas resources
Transportation and liquefaction constraints limit development of isolated gas resources
Conventional oil located mainly in the Middle EastExtra heavy oil and Bitumen concentrated in Canada and Venezuela
Oil and gas resources require advanced technology and large scale investmentWith ample availability of oil and gas and existing infrastructure, hydrocarbons will be dominant fuel source for the next decades
~3,000 Bboe
Unconventional resourcesoil shale, shale gas,
coal bed methane, tight gas
Extra Heavy oil & Bitumen
New discoveries and increased recovery rate
Identified resources
33 years of production at current pace
50 years
100 years
70 years
~3,000 Bboe
55 years of production at current pace
80 years
>125 years
Already produced
4 - Fort McMurray – 21 January 2011
5
Billions of barrels
80
60
40
1000 2000 3000
20 OPECMiddle East
Extra
Oil shales
100
Billions of barrels
80
60
40
1000 2000 3000
20 OPECMiddle East
Extra
Oil shales
100
$/bbl
Billions of barrels
80
60
40
1000 2000 3000
20 OPECMiddle East
water
Extra
Oil shales
100
Billions of barrels
80
60
40
1000 2000 3000
20 OPECMiddle East
OtherConventional
Deep
Ultra deepwater
EnhancedRecovery
Extra Heavy
oil
Oil shales
100
Arctic
$/bbl
Break even oil price in 2010 (IRR >10%)
Sources: IEA, CERA, Total
But additional oil resources are more and more difficult and expensive to extract
- Fort McMurray – 21 January 2011
6
0
5
10
15
20
25
30
35
40
Heavy oil
LNG
Resources*: 40 Bboe / 40 years
Resources*> 40 years
(at December 31, 2009)
Total: meeting global energy demand
Diversified global portfolio offering balanced risks rewards
≥ 2 Bboe 1 - 2 Bboe ≤ 1 BboeResources* : 40 Bboe
Other liquids
Deep offshore
Other gas
Africa
Bboe12
Americas
Middle East / Asia6
Europe and CIS
2P reserves**> 20 years
1P reserves***12 years
* proved and probable reserves at year-end 2008 plus contingent resources (SPE-PRMS) ** limited to proved and probable reserves estimated at year-end 2008 using company price assumptions, covered by E&P contracts on fields that have been drilled and for which
technical studies have demonstrated economic development, also includes tar sands to be developed with mining*** reserves of consolidated subsidiaries (FAS 69) and share of equity affiliates and non-consolidated companies
- Fort McMurray – 21 January 2011
Total: focusing increasingly in growth areas
Represents approx. 50% of Total’s resource base
Producing
Under development
Under study
Unconventional gasHeavy oilDeep offshore LNG
Blocks 17, 14 - AngolaAkpo, Bonga - NigeriaMoho Bilondo - CongoTahiti - Gulf of Mexico
Pazflor - AngolaUsan - Nigeria
Laggan Tormore - UK
CLOV - AngolaEgina - Nigeria
Block 32 - Angola
Surmont Ph.2 - Canada
Joslyn - CanadaFort Hills - Canada
Northern Lights - Canada
Bemolonga - Madagascar
JV Barnett Shale - US
Ahnet - AlgeriaSulige - China
Montélimar - FranceNeuquen - Argentina
QG 1, QG 2 T5 - QatarBontang - Indonesie
NLNG - NigeriaSnohvit - Norvège
Yemen LNG (2 trains)Adgas , Oman LNG
Angola LNG – AngolaGLNG – Australia
Ichthys - AustraliaShtokman - RussiaNigerian projects
Expansion JV Barnett Shale – US
GLNG - Australia
Petrocedeño - Venezuela
Surmont Ph.1 - Canada
7 - Fort McMurray – 21 January 2011
8
Fort McMurray
Total in Canada: developing strong base to grow production
Griffon
Asphalt Creek
Buckton
Emerillon
Fort Hills (TOTAL 39.2%* / SUNCOR operator 40.8%*/Teck 20%)Mining, Prod.100%: 160 kbpd bitumen 2016
Joslyn (TOTAL operator 38.25%*/SUNCOR 36.75%*/OXY 15%/ INPEX 10%)Mining, Prod. 100%: JNM (ph.1) 100 kbpd 2017-18, JME (Expans.) 100 kbpd
Surmont (TOTAL 50%/ConocoPhillips operator 50%)In-Situ (SAGD), Prod. 100%: Ph. 1: 23 kbpd, Ph. 2: 110 kbpd, 2015
Northern Lights (TOTAL operator50% /SINOPEC 50%)Mining, Prod. 100%: ult. 100 kbpd bitumen
VOYAGEUR Upgrader (TOTAL 49%*/SUNCOR operator 51%*)Upgrading: 245 kbpsd 2016
Lease Total Operator Total Partner Operated - Fort McMurray – 21 January 2011 * Fort Hills, Voyageur, Joslyn shares subject to Total-Suncor transaction completion expected by 1Q2011
Surmont: one of the largest SAGD leases
Operated by ConocoPhillips (50%)
Phase 1 already producing20 well pairs at start-up from two padsSteam injection started in June 2007Currently producing 23,000 bbl/d
Future developmentsPhase 2 : sanctioned January 2010, bringing production to 110,000 bbl/d by 2015.Phase 3 : conceptual study in 2011Additional phases are possible for full lease development
Technology investment to minimize impactsSAGD technology continuously enhancedES-SAGD pilot under developmentSAGD creates less land disturbance although GHG emissions still a challengeCO2 Capture and Storage (CCS) experience from Lacq & others
Developing expertise in a key in situ technology
Surmont (Total 50%)
9 - Fort McMurray – 21 January 2011
Joslyn: preparing production for 2017 - 2018
Multiphase development in basic engineering and regulatory stages Expected to yield 2 Bb of bitumen production
over 30 years Oil sands surface mining techniques 100,000 bbl/d for Joslyn North Mine JNM hearing in September 2010
Technological and R&D investment to limit environmental impact New methods of sand and thickened tailings
beaching for enhanced tailings management Off Stream storage pond integrated Cogeneration Plant Industry cooperation / joint research pilots
Total Canada committed to developing technically and environmentally challenging project
Joslyn (Total 38.25%*)
Total operator, Suncor36.75%,Oxy 15%, Inpex 10%Leases covering area of 221 km2, of which 70 km2
10 - Fort McMurray – 21 January 2011 10
Fort Hills : growing our portfolio
Operated by Suncor (40.8%*), remaining 20% held by Teck Resources Ltd
Estimated 3.4 billion barrels of bitumen
Extracted by mining with truck and shovel
Planned start-up mid 2016
Two-phase development: Initial production : ~160,000 bbl/d With de-bottlenecking: ~190,000 bbl/d
11
Fort Hills (Total 39.2%*)
11 - Fort McMurray – 21 January 2011
Voyageur Upgrader : upgrading in Alberta
Operated by Suncor (51%*)
Design: 245,000 bb/sd
Scheme: Delayed Coker 3 pairs of drums
Close to existing Suncor Upgraders
Hot bitumen from Fort Hills and Joslyn North mines
Project resumed after interruption - planned start-up 2016
12
Voyageur Upgrader (Total 49%*)
12 - Fort McMurray – 21 January 2011
Northern Lights Partnership: long term development
Operated by Total Canada (50%), remaining 50% held by SinoCanada (Sinopec affiliate)
Estimated 1 billion barrels of bitumen to be recovered by mining
One phase development around 100,000 bbl/d
Ongoing evaluation of the best scenarios for development, production and export
13
Northern Lights Partnership (Total 50%)
13 - Fort McMurray – 21 January 2011
14
Environmental issues at the core of Oil Sands bad press“For every barrel of oil sands it requires enough
natural gas to heat an average Alberta home for four days”Al Gore
“Carbon Neutral by 2020: A Leadership Opportunity
in Canada's Oil Sands”Pembina Institute
“The oil sands reserves cover an area of 140,000 km2 of the boreal forest - equivalent to 25% of
Alberta (approximately the size of France)”World Wildlife Fund
“Dirty Oil”
“The most destructive project on earth”Environmental Defense
- Fort McMurray – 21 January 2011
15
Looking at the CO2 intensity of oil sands production
Up to 45 kg CO2 /b
62 kg CO2 /b
JOSLYN/SURMONT
Up to 70 kg CO2 /b
REFERENCES
38 kg CO2 /b (incl. Cogen)
MININGMINING
MINING
Power by others
SAGDPower by others
CONVENTIONALOIL*
15 – 100 kg CO2e/b
(~25 kg CO2e/b)
- Fort McMurray – 21 January 2011
16
Reducing Water Usage in Oil Sands Projects : Joslyn & Surmont
Net Water Withdrawal Intensity (bbl water per bbl bitumen)
In-Situ Mining
Surmont SAGD: 0.3 bw/bb Joslyn N Mine: 1.6 bw/bb (steady state) up to 2.3 (maximum)
Other projects: 0.2 - 1 bw/bb Other projects: 2 - 4 bw/bb
Surmont SAGD 95% of water needs from
recycled water Withdrawal of make-up water
from groundwater wells
Joslyn North Mine 90-day off-stream storage pond 80% of water needs from
recycled waterClo
sed
circ
uit s
yste
m
- Edmonton – January 2011- Fort McMurray – 21 January 2011
17
Land Disturbance Footprint in Boreal ForestCanada’s boreal forest : 3.2 million km2
Oil sands: 140,000 km2 of which
4,800 km2 is mineable (0.1% of Canada’s or 1% of Alberta’s boreal forest)
~ 20 000 km2 considered for in situ developments
Currently disturbed by oil sands mines: 602 km2 (< Calgary foot print)
Joslyn North Mine: reducing disturbance and accelerating reclamation processYet biodiversity wealth must be protected and cumulative impacts managed
Joslyn North Mine 70 km2
61% to be reclaimed by closure using progressive reclamation, rest 7 yrs later
Existing mining projects typically <40% reclaimed by closure
Surmont In-situ Phase 1: 1.2 km2 (initial develop.)
Phase 2: 4 km2 (initial develop.)
Voluntary Faster Forests Program to expedite tree planting/reclamation
- Fort McMurray – 21 January 2011
18
Stakeholder relations: critical to acceptability
Strong industry cooperation to address cumulative effects
First Nations concerns addressed Treaty rights Cumulative impacts Cultural preservation & respect Business opportunities
Engagement with communities based on dialogue and empowerment Mitigation Plans Community Content Plans Socio-Economic agreements
Reconciling economic development with environmental and social performance
Community investment
Over C$5M invested since 2008
Wide range of investments in Canadian organizations (arts, health, environment, aboriginal culture, etc...)
Canadian college & university partnerships & scholarships
- Fort McMurray – 21 January 2011
Creating economic benefits: Committed to Canada’s business success
$20B cumulated investment in Canada by 2020
4 major projects by 2020 = > 200,000 bb/d Total share
From 250 to 1,500 full time jobs in 2016
Thousands of contractors during construction
1919 - Fort McMurray – 21 January 2011
A global energy company investing in Canada’s long term economic prosperity
Business relationships: critical to shared success
Collaborative spirit
Creating value through best practices sharing and synergies
Developing better technologies Osli Tailings consortium
Multiplying local opportunities Employment Supply Chain Socio-Economic Development
Developing stronger Communities
2020 - Fort McMurray – 21 January 2011
Building partnerships to create shared value and sustainability
Business relationships: critical to shared challenges
Managing regional growth in context of increased activity
Meeting Human resources – qualified and plentiful workforce
Planning to anticipate associated infrastructure needs
Managing costs
Improving significantly HSE performance
2121 - Fort McMurray – 21 January 2011
Working together to find win-win solutions
Strategic alliance completion & projects review with Suncor
Complete JNMP regulatory process and Basic Engineering
FH and V Projects sanctions based on anticipated timelines
Ramp up TEPCA recruiting
Additional TEPCA personnel in our local office, i.e. Business Development Coordinator
TEPCA vendor qualification and contracting processes
Maintaining dialogue with business community and stakeholders
2222 - Fort McMurray – 21 January 2011
Phased approach aligned with project timelines
Next steps
23
Addressing sustainable development in local business context
Fueling the future: Need for a “New Balance” and continuous improvement
Massive investments High breakeven Unknown CO2 cost More stringent royalties regime
Stakeholder relations
Environmental Challenges
Challenging Economics
CO2, water, land footprint, strict administrative process, local acceptability
Further R&D to improve management of resources and environment
Engaging communities based on dialogue and sustainable partnershipsWorking with local business
- Fort McMurray – 21 January 2011