TotalEnergies says high gas prices could last until spring as profits rise
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The logo of the French oil and gas company TotalEnergies can be seen at a gas station in Ressons, France on August 6, 2021. REUTERS / Pascal Rossignol
PARIS, October 28 (Reuters) – TotalEnergies (TTEF.PA) said high gas prices in Europe and Asia could last until spring as the French energy group on Thursday announced a sharp rise in profits in the third quarter following the surge in electricity prices.
The company’s adjusted net income in the third quarter climbed to $ 4.8 billion from just $ 848 million last year, with core profits more than doubling to $ 11.2 billion.
CEO Patrick Pouyanne told reporters that weak supply and sustained strong demand will likely keep gas prices high in Europe and Asia until next spring, although they are expected to start easing. after winter.
The group, which is expanding aggressively in electricity and renewables, estimated that its production of gas and crude oil would reach its highest levels since the second quarter of 2020.
It said it is expected to produce between 2.85 and 2.9 million barrels of oil equivalent per day (mboeh) in the last three months of 2021, after reaching 2.814 mboeh in the third quarter.
TotalEnergies also predicted that its average liquefied natural gas (LNG) selling price would rise to more than $ 12 per million British thermal units (MMBtu) in the last quarter, from $ 9.10 in the previous three months.
The company has confirmed its intention to repurchase $ 1.5 billion of shares in the last three months of the year, which it announced in late September amid high electricity prices. Read more
WIND IN THE SAILS
Driven by high gas prices, TotalEnergies said its net investments this year are expected to reach nearly $ 13 billion, at the top of a range announced earlier in the year.
The company, which changed its name last spring, aims to be one of the world’s top five producers of renewable energy by 2030, although in the meantime it continues to devote around three-quarters of its investments to oil and gas. Read more
Like its competitors, TotalEnergies has come under pressure from climate activists and some shareholders to accelerate the shift from fossil fuels to cleaner energy sources.
Pouyanne said he had “no doubt” that the company would meet its 2030 target of 100 GW of renewable power generation capacity, as it plans to add an additional 6 GW next year.
He said the company could expand into offshore wind quickly and would consider purchasing smaller renewable energy developers.
Report by Benjamin Mallet, written by Sarah Morland; Editing by Lincoln Feast and Emelia Sithole-Matarise
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