TotalEnergies SE CEO Patrick Pouyanné believes recent exploration successes in South America and Africa hold potential to boost both the Paris-based company’s production and cash flow.
“During the quarter, confirmation of exploration successes in Suriname and Namibia opened the way to new oil developments contributing to future cash flow growth,” Pouyanné said in TotalEnergies’ third quarter 2023 financial statements press release.
TotalEnergies reported combined production of 2.5 MMboe/d in this year’s third quarter, up 5% compared to last year’s third quarter due to the start-up of numerous oil projects in Brazil (Mero 1), Nigeria (Ikike) and Iraq (Ratawi) as well as gas projects in Oman (Block 10) and Azerbaijan (Absheron), said Pouyanné.
TotalEnergies reported an adjusted net income of $6.5 billion in third quarter 2023, down 35% compared to third quarter 2022 due to a drop in Brent and Henry Hub prices as well as those related to the LNG markers, NBP in Europe and JKM in Asia. Cash flow from operations was $9.3 billion in the third quarter this year, down 20% compared to the third quarter last year.
"While implementing its balanced transition strategy that combines oil & gas and integrated power, TotalEnergies demonstrates once again this quarter its ability to leverage a supportive price environment,” Pouyanné said, adding that the company generated a return on average capital employed of over 20%.
TotalEnergies expects production in the fourth quarter this year to come in between 2.4 MMboe/d and 2.5 MMboe/d, reflecting the divestment of oil sand assets in Canada, Pouyanné said.
On the commodity side, TotalEnergies expects oil prices to remain buoyant during the remainder of the year due to OPEC+ actions on supply amid geopolitical tension in Ukraine and now the Middle East. The company also expects gas prices to react to production disruptions amid high inventories in Europe.