Royal Dutch Shell Plc  .com Rotating Header Image

AFX News Limited: Total CEO targets Upstream profitability of at least 20 pct vs 35 pct

EXTRACT:Total is not interested in buying the French refinery operations being sold by Royal Dutch Shell (nyse: RDSA – news – people ), Margerie said.

PARIS (AFX) – Christophe de Margerie, the new chief executive of Total, said the group’s Upstream oil production activities are unlikely to maintain their current profitability, due to higher taxes in oil producing countries and cost increases.

But although the Upstream division will not maintain the 35.5 pct return on capital employed in 2006, Margerie said the company will continue generating a return on capital of at least 20 pct.

‘We should be able to ensure profitability of at least 20 pct over the long term, which is still a very good performance,’ Margerie said in an interview with Le Figaro, after Total’s release of 2006 earnings yesterday.

This target will be reached even if oil prices stay within a 50-60 usd per barrel range this year, he said, adding that Total will not reduce its investment plans even if oil prices were to remain below last year’s highs.

‘We are certainly not going to slow the rhythm of our projects just because the barrel price is little less high,’ Margerie said.

He declined to say where Total would like to develop its exploration and production activities, but reiterated that the company wants to expand its refinery activities in markets where demand for gasoline and other products is growing.

As a result, Total is not interested in buying the French refinery operations being sold by Royal Dutch Shell (nyse: RDSA – news – people ), Margerie said.

He declined to comment on the French legal investigation into alleged wrongdoing by Total involving the UN oil-for-food programme in Iraq, which occurred when Margerie was a director in the region.

[email protected]
js/amb

Copyright AFX News Limited 2006. All rights reserved.

royaldutchshellplc.com and its sister websites royaldutchshellgroup.com, shellenergy.website, shellnazihistory.com, royaldutchshell.website, johndonovan.website, shellnews.net and shell2004.com are all owned by John Donovan. There is also a Wikipedia article.

0 Comments on “AFX News Limited: Total CEO targets Upstream profitability of at least 20 pct vs 35 pct”

Leave a Comment

%d bloggers like this: