“My entrepreneurial Spirit was reincarnated after reading Rich Dad® Poor Dad and I began a journey that led to the achievement of being the most successful Facilitator of CASHFLOW® events in CANADA.”
Interview with Total SA's Yves-Louis Darricarrère Yves-Louis Darricarrère, president of global exploration and production for the energy giant. Walter Tychnowicz for National Post Total SA, which produces the equivalent of 2.3 million barrels of oil per day and is one of the largest oil-and-gas company in the world, has taken a shine to Alberta's vast oil sands -- and as Yves-Louis Darricarrère, president of global exploration and production for the energy giant, explains, the company has no plans to slink away. On the eve of his first trip to the Athabasca oil sands, Mr. Darricarrère spoke with the Financial Post's Carrie Tait about Total's plans for Alberta and his thoughts on where the next big oil discovery will pop up. Q. What is Total's interest in Alberta? A. It has a high interest in Alberta. We are investing and we are committed to Alberta and we are investing in Alberta for the long term. Our goal is to build a strong and sustainable position through production of the leases that we have today in the Athabasca oil sands. And we intend to build an upgrader here. We think that the oil sands in the Athabasca will be absolutely necessary -- needed for the balance between demand and supply of energy in the mid-to-long term. When we look at our future in Alberta, we are ready to invest in the 10 to 15 years, between $15-billion and $20-billion in those projects. And we should reach production plateau around 250,000 barrels of bitumen between 2020 and 2030. Our capital expenditure this year in E&P [for all of the world] will be around $14-billion. So [over] the 15 coming years, something not far from 10% of our investment efforts [will be spent in Alberta]. Q. Can you reach your 250,000 barrels per day goal by just growing your Joslyn mine and Surmont steam-assisted gravity drainage project, or do you have to find other projects? A. No. It is based on the development of the existing lease. Q. Do you have aspirations beyond that? To expand? To acquire? A. [Our position] is already not too bad. But, you're right, at the same time, as a general principle worldwide, [where] Total wants to go, we are always ready to expand. But in Canada, as everywhere in the world, we want to expand, but we want to do it in a disciplined manner [and] it must always be aligned with our strategic strategy. A good illustration of that is UTS. We made an offer on UTS, we considered that this offer was giving fair value to shareholders, and the shareholders expected more. We withdrew our bid because we want to do it in a disciplined manner. Our strategy is organic growth. We prefer organic growth everywhere in the world, for any of our areas of interest. But we do not exclude some acquisitions. Q. Could your UTS bid be revived? A. I have enough issues which are real issues. I will not answer questions on potential possibilities and opportunities and so on. Q. Where does oil have to trade at for Total to make money in the oil sands? A. We need an oil price around US$80 per barrel for new oil sands projects to be viable. And even that is a challenge. The cost of producing the oil sands is high and it will be higher and higher because of the need to address the environmental challenges and so on. At the same time, technology will make it profitable. It will be a balance between the trends which makes the costs higher and higher...and the technology. It is a race between the two. I am sure technology will win the race. Q. Where do you think the next big oil discovery will be? A. There are still discoveries to be made, for sure. But at the same time, there are a number of already discovered but undeveloped fields. And most of them are in domain of those national and gas companies. But where can we expect new discoveries or developments to take place? Obviously right now Brazil is a country where new [and important] discoveries have been made. I do believe discoveries will continue to be made in Africa. I do believe that discoveries will continue to be made in the Caspian areas. And furthermore, in the Middle East, a lot of fields which are still undeveloped but already discovered still exist. In Iraq you have a number of fields which need to be developed. If I look at countries which will see their production grow in the future, there are not so many of them. I think in the Middle East, there will be countries where production will continue to grow. Mainly Iraq, Iran and Saudia Arabia -- obviously the production will continue to grow. In the CIS area -- Kazakhstan, and to a certain extent Azerbaijan will continue to see their production grow, and it will compensate for the decline of the Russian production. Canada will be a country where production will continue to grow. Venezuela will be, on the long-term. And two countries in Africa will enjoy growth: Nigeria and Angola. You have about eight countries [where production will grow]. Those countries will make up for the decline of the mature areas. Q. What are your thoughts on supply and demand? A. Our vision is the mid-term, long-term, the demand for oil will be constrained by the supply, by the capacity of supply. Today, it is the contrary. In the future, the demand will be constrained by the supply. And it is not because of a lack of reserves -- there are plenty of reserves for oil in the world -- but it is an issue of capacity for production. And when you add all the components necessary to bring new production capacity into operation, you need to have the technical capacity to do it, so there are some technical constraints; you need to have the right investment policy; you need to have the right geopolitics; you need to have the right logistics; you need to add many things together. And when we look to that, we think it will be difficult for the world to produce more than 95 million barrels of oil per day. And look at the demand part. You have a [production capacity] plateau which will be reached between 2020 and 2030. At the same time, if you look at the demand, clearly in OECD countries, the demand will probably plateau or decrease slightly. But nevertheless, when you look at the needs for China, India and the other emerging markets, all together the need for energy and the need for oil and gas will continue to grow. So that means the price of oil, in the long-term, will increase to address demand and supply. It will be a real challenge for everyone -- for industry, for the authorities to produce the level of oil which will be needed to supply the demand. At the same time, we will have to address the environment: climate change and CO2 emissions. And we have to solve those two issues at the same time |