Total Expects Output Growth From African Fields, LNG

By Tara Patel

Sept. 10 (Bloomberg) -- Total SA, Europe's third-largest oil company, said production growth over the next decade will come from deep offshore fields in Africa, heavy-oil ventures in Canada and liquefied natural-gas projects.

The projection is based on crude prices of $100 a barrel, the company said today in a slide presentation on its Web site. Paris-based Total didn't give a forecast for average output growth from 2006 through 2010, which was targeted at 4 percent a year ago assuming oil prices at $60 a barrel.

``Total is reassuring on growth prospects,'' said Chicuong Dang, an analyst at Richelieu Finance in Paris, which has about $6.2 billion under management including Total stock. ``They seem to have good visibility on projects with oil at $100 a barrel,'' Dang said today by telephone.

Total rose as much as 1.5 percent to 44.84 euros in Paris trading and was at 44.37 euros as of 12:23 p.m. local time. The shares have lost about 22 percent since the beginning of the year.

Chief Executive Officer Christophe de Margerie is relying on projects in Angola and Canada's oil sands to raise output as Kazakhstan and Venezuela restrict access to reserves. The company has increased spending on exploration and production amid rising costs and started selling non-energy assets including a stake in drugmaker Sanofi-Aventis SA and a rubber unit.

Angola Growth

Total said it expects to pump more oil offshore Angola, where its Dalia field in Block 17 reached peak output of 240,000 barrels a day in April, 2007. The nearby Rosa field -- connected to the Girassol floating production platform -- will maintain production at 250,000 barrels a day until early next decade, according to Total.

The company forecast its share of production from all projects at almost 3 million barrels of oil equivalent a day by 2016, based on a ``$100-a-barrel scenario,'' according to the presentation. The company estimates its share in 2010 at about 2.5 million barrels a day.

That compares with second-quarter output of an average 2.353 million barrels a day. Production was 2.322 million barrels a day in the year-earlier period and 2.426 million barrels a day in the previous quarter.

Total's plan to invest $19 billion this year is ``on track,'' the company said. Spending on exploration will rise 10 percent to $2 billion annually in ``coming years.''

LNG Output

Total said almost a fifth of production will come from LNG ventures by the middle of the next decade, with growth led by nine liquefaction projects already operating or under construction. A further five are being studied, it said.

Total plans to triple LNG output to 30 million tons a year by 2016, surpassing Exxon Mobil Corp. and remaining behind Royal Dutch Shell Plc, it said.

The company's LNG assets include stakes in projects in Yemen, Qatar and Angola. Total is also counting on a share of future output from the Shtokman gas field in the Arctic Ocean. The deposit is being developed by OAO Gazprom along with Total and Norway's StatoilHydro ASA.

Total's Joslyn and Surmont heavy-oil ventures in Canada are among the ``building blocks'' for boosting output from 2016, the company said. The oil sands will provide the company with almost 300,000 barrels a day of production capacity by 2020.

Total started output at its Jura gas and condensate discovery off Scotland's northeast coast in May. In the Republic of Congo, it's studying a ``second development in the northern part'' of the deep offshore Moho-Bilondo block, it said today.

Project Delays

Global oil production will ``remain below 100 million barrels of oil a day through 2030'' as geopolitical and ``local constraints'' delay new projects, the company said.

Total, Eni SpA and their partners in Kazakhstan's Kashagan field agreed to cede a greater stake in the development to the government in January. Total also cut its holding in Venezuela's Sincor project last year after the state oil company took a controlling interest.

Total put its glove and condom-making unit up for sale in August and plans to sell its 13 percent stake in Sanofi-Aventis, having sold 0.4 percent last year for 316 million euros ($445.4 million).

The company's board has approved a 14 percent increase in its dividend, reflecting the earnings outlook, Total said today. The 2008 interim dividend will be 1.14 euros a share.

To contact the reporter on this story: Tara Patel in Paris at tpatel2@bloomberg.net