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TotalEnergies-Exceptional dividend, LNG will grow despite Russia


PARIS, September 28 (Reuters) –

TotalEnergies announced on Wednesday its intention to pay an exceptional interim dividend of one euro per share in December 2022, in a context of high hydrocarbon prices, while maintaining its share buyback program at 7 billion dollars on the whole exercise.

The oil company, which is implementing an offensive diversification strategy in renewable energies, also announced during an investor day that it was aiming for liquefied natural gas (LNG) growth in its production of 40% by 2030 and an increase in sales of 3% per year by 2027.

These forecasts, however, reflect slower growth than expected a year ago, TotalEnergies having decided to exclude Russia from the presentation of its strategy while it still holds interests in the assets of Yamal LNG, in the Arctic project. LNG 2 and in the gas group Novatek – despite international sanctions against Moscow since the start of the invasion of Ukraine.

At the same time, TotalEnergies forecasts a growth in its cash flow (excluding Russia) of 4 billion dollars over the next five years instead of an increase of 5 billion between 2021 and 2026 targeted a year ago.

The group takes “moderate assumptions of energy prices” – 50 dollars per barrel of oil in particular – and indicates that it would benefit from more than 3 billion additional for each increase of 10 dollars per additional barrel. The increase in cash flow “will support the growth of the dividend over the next 5 years.”

The group has also indicated that it intends to allocate “through the cycles” 35 to 40% of its cash flow to shareholders. Taking into account its exceptional dividend scheduled for December, which will be above the 5% increase in quarterly installments already announced and implemented, it estimates that its return to shareholders should be within this range as soon as 2022.

CANADIAN OIL SANDS SPLIT-UP PROJECT

TotalEnergies plans to increase its net investments – which would be between 14 and 18 billion dollars per year over 2022-2025 -, devoted as a priority to the development of low-carbon energies and programs to reduce its carbon footprint, which will reach a third investments.

Investments in solar and wind energy will thus exceed 4 billion dollars from 2022 (compared to 3 billion dollars in 2021) and a program of 1 billion in energy savings will be deployed worldwide in 2023-2024.

The remaining two-thirds of the investments will be dedicated to growth in LNG on the one hand and to developing “low cost and low emissions” oil projects on the other hand to meet demand.

TotalEnergies, which presented its outlook at an investor day held in New York, also announced a plan to spin off its oil sands activities in Canada in 2023, with the group planning to retain a minority stake in the company that would be created .

He estimates that his debt ratio should show a sharp drop at the end of 2022, around 5%, “which gives him new room for maneuver”. (Report Benjamin Mallet, edited by Matthieu Protard and Jean-Stéphane Brosse)




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