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Selection of Bloomberg News articles about Total, a potential merger partner for Shell

FIRST ARTICLE: Bloomberg: Total’s De Margerie Says Refining Is `Strategic’ for Company

By Tara Patel

March 15 (Bloomberg) — Total SA, Europe’s third-largest oil company, will invest 1 billion euros a year through 2010 in refining, a “strategic” business for the company, its chief executive officer said.

“Refining remains an important strategy for us,” Chief Executive Officer Christophe de Margerie said today at a news conference in Normandy, the site of Total’s largest French refinery. “We are not getting out of the sector because at one point in time it’s not profitable. We don’t have a stop-and-go kind of policy.”

The Normandy refinery, located at Gonfreville near Le Havre at the mouth of the Seine River, has been one of the biggest beneficiaries of Total’s investment. The company has spent about 1 billion euros ($1.32 billion) over the past five years modernizing equipment and building a new 550 million-euro distillate hydrocracker to help meet growing demand for diesel fuel in Europe.

The hydrocracker officially opened today, although it began working in November. It will increase diesel output at the plant to 5.3 million tons this year from 4 million tons in 2005, Total said.

“We are hoping to raise this level one day,” said Total’s head of refining, Andre Tricoire. It’s too early to say just how much more diesel could be produced, he said.
Importing Diesel

France imports about a third of the diesel it needs, mostly to run the growing number of cars that use the fuel, Total said. About 70 percent of the new cars sold in France last year had diesel engines, compared with a little more than half that a decade ago. Demand for diesel in Europe is expected to be double that for gasoline by 2010.

“The point of building a hydrocracker is that in Europe there is a marked increase in the diesel-oriented market whereas most refineries were originally built for a gasoline-oriented market,” said Colin Smith, an analyst at Dresdner Kleinwort in London, in an interview yesterday. “Total has been ahead of the game in Europe. There have been a number of announcements from other companies adding new distillate capacity.”

The hydrocracker will make low-emission diesel with less than 10 parts per million of sulfur to meet future European limits.

“This is a pretty decent-sized hydrocracker,” Smith said. “The risk is for the profitability of the unit if the current period of high refining margins ends.”

To contact the reporter on this story: Tara Patel in Paris [email protected]

SECOND ARTICLE: Bloomberg: Total Raised to `Overweight/Attractive’ at Morgan Stanley:FP FP

By Sandro Bottoni

Princeton, New Jersey, March 15 (Bloomberg Data) — Total SA (FP FP) was raised to “overweight/attractive” from “equal-weight/attractive” by analyst Neil Perry at Morgan Stanley. The 12-month price target is 60.50 euros per share.

THIRD ARTICLE: Bloomberg: Total Says It Has Bid for Part of Russia’s Shtokman (Update1)

By Tara Patel

March 15 (Bloomberg) — Total SA, Europe’s third-largest oil company, intends to bid to take part in Russia’s Shtokman natural- gas project, the company’s chief executive officer said.

Shtokman “remains strategic,” Total Chief Executive Officer Christophe de Margerie said today at a press conference in Normandy, where the company was opening a new refinery unit. Total put in a bid March 12 for a share in the project, de Margerie said.

Total is also pursuing a liquefied natural gas project in Iran. The entire project is worth $10 billion, with Total’s portion worth about 2 billion euros ($2.6 billion), he said.

“We still need an agreement with the Iranian authorities,” de Margerie said.

Iran has been lagging behind Qatar in developing its part of South Pars, a giant gas field they share geographically. Total owns a 30 percent stake in an LNG venture called Pars LNG, which intends to build a $2 billion liquefaction facility using gas from the Phase 11 development of the South Pars field.

“We will take into account geopolitical problems,” de Margerie said.

The United Nations Security Council imposed sanctions on Iran after it refused to quit enriching uranium, a step toward developing nuclear weapons. The UN also froze assets of individuals and groups involved with Iran’s nuclear program and threatened “further appropriate measures” if Iran failed to comply.

Total executives have said they first want to decide whether the project is worth pursuing financially and strategically before tackling possible political obstacles to the investment.

“We can’t give a time table,” de Margerie said.. “We’re not in the driver’s seat.”

To contact the reporter on this story: Tara Patel in Paris [email protected]

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