Soaring oil and gas prices drive the industry to increase income and feed investment budgets, reports Reuters.
Share buyback
TotalEnergies has decided to use part of its cash inflow for share buybacks worth at least $800 million.
The company announced their initiative to supply renewable electricity in collaboration with Amazon. It’s also taking notable milestones in its investments in various areas, including the “Blue Charge”.
Sustainable energy sectors
France’s TotalEnergies (TTEF.PA) has been betting big in sustainable energy sectors, which has come at the ideal time as oil and gas costs have skyrocketed. As oil and gas prices remain high, Royal Dutch Shell (RDSa.L) Norways’ Equinor has announced share buyback plans on Thursday.
At 1500 GMT, TotalEnergies shares were up 2.4 per cent, which implies that the company expects a cash flow of $25 billion this year, with plans to invest in new ventures if oil prices remain high and return the surplus to shareholders.
In a statement, TotalEnergies said:
“The board of directors decided to allocate up to 40% of the additional cash flow generated above $60 per barrel to share buybacks.”
In a media briefing, Chief Executive Patrick Pouyanne said it would mean $800 million in share buybacks in 2021.
“And if the average price is going up to $68 (a barrel), for example – we are not far – it could go up to one billion dollars,” he stated.
In addition, the company announced that it would pay a second interim dividend of 0.66 euros per share in 2021, which will remain unchanged from the first quarter.
Hydrocarbon production
However, the company claimed it lost $1.38 billion on the sale of its 30.3 per cent stake in Petrocedeno, a light crude oil producer; adjusted net income grew to 3.5 billion dollars in the April to June period, up from 1.26 million dollars a year ago at the start of the Covid 19 outbreak.
Despite owning the Yucal Placer gas field in Venezuela, TotalEnergies stated that Petrocedeno development did not follow the second half of 2021; the business marginally reduced its hydrocarbon production expectation for 2021 2.85 million barrels of oil equivalent per day (Mboe/d). It had earlier predicted that output would remain constant compared to 2020s 2.87 Mboe/d.
Even though the corporation has a high milestone plan to become carbon-neutral by 2050, it faces stiff competition from top energy companies such as Iberdrola, a Spanish wind power company, and Italy’s Enel.
Did you subscribe to our daily newsletter?
It’s Free! Click here to Subscribe!
Source: Reuters
