TotalEnergies sheds Canadian oil sands, boosts output in lower-price environment

TotalEnergies sheds Canadian oil sands, boosts output in lower-price environment


TotalEnergies said its first-quarter adjusted net income fell 27% to $6.5 billion – in line with analyst expectations – due to lower oil and gas prices.

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French oil and gas major TotalEnergies said on Thursday it had accepted an offer to sell its carbon-heavy Canadian oil sands operations to Suncor Energy for $4.1 billion, with potential additional payments of up to $450 million.

The company had initially planned to spin off the business but said the sale to Suncor would be a more straightforward transaction and the price tag was comparable to its own valuations for a listing of the business.

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Taking into account proceeds from the sale, which should close by the end of the third quarter, it plans to distribute at least 40% of the cash flow generate this year to shareholders, either through a share buyback or special dividend.

TotalEnergies said its first-quarter adjusted net income fell 27% to $6.5 billion – in line with analyst expectations – due to lower oil and gas prices.

The company is sticking with plans for a share buyback of up to $2 billion in the second quarter, as it did in the first three months of the year. It confirmed it expected net investments of $16-18 billion this year, including $5 billion for low-carbon energies.

The company, which saw European refining capacity hampered by French strikes in the first quarter, anticipates its facilities will ramp back up above 80% with the end of the protests. But the margins on refining diesel will drop as Chinese exports increase and Russian volumes find new global buyers.

TotalEnergies also expects its gas production and sales to increase as projects start up in Oman and Norway, and as a major U.S. liquefied natural gas export terminal comes back online.



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