Patrick Pouyanné, chief executive officer of Total SA, speaks during a session on the opening day of the World Economic Forum in Davos, Switzerland, Jan. 21, 2015. Pouyanné said this week that Total would cut as much as $3-billion (U.S.) from its 2015 budget compared with a year ago.Jason Alden/Bloomberg
Total SA has appointed a new head of its Canadian operations as the French oil major plans cuts in its oil sands business to cope with the collapse in crude prices.
Total has named Laurent Maurel as president and chief executive of Total E&P Canada, replacing André Goffart, who had held the post since 2012.
A 25-year veteran of the company, Mr. Maurel was previously senior vice president of strategy, markets and liquefied natural gas for Total Gas & Power in Paris.
Total is making the change as oil prices below $50 (U.S.) per barrel squeeze the margins of the company's oil sands projects, which include the producing Surmont steam-driven development and Fort Hills, a $13.5-billion (Canadian) mining venture that is under development. Suncor Energy Inc. is lead partner at Fort Hills and Teck Resources Ltd. is the other participant.
Total's CEO, Patrick Pouyanné, said this week it would cut as much as $3-billion (U.S.) from its 2015 budget compared with a year ago, with reductions earmarked for the oil sands as well as offshore projects in Britain's North Sea and mature fields off West Africa. Mr. Pouyanné , in an interview with The Financial Times, did not give details on the extent of the cuts to be made in Canada or the specific projects.
Company spokespeople said in an e-mail to The Globe and Mail that any oil sands project with a high break-even oil price is being postponed. They noted it had shelved its $11-billion Joslyn project in Alberta last spring, saying it had planned to study ways to reduce development costs.
Total has a 50-50 partnership with China's Sinopec in another oil sands lease known as Northern Lights, though development there has not begun.
Suncor has said it has no current plans to slow down spending at Fort Hills, but that it could to so if oil prices remain at today's levels for two to three years. Output is scheduled for 2017.
Total is scheduled to provide more details about plans for its worldwide operations in in its annual results conference call set for Feb. 12.
The company said Mr. Maurel's appointment was effective Jan. 1.
Jeffrey Jones