Nerguararian Total Eng

TOTAL: developing international offshore experience in Russia

By Pierre Nerguararian

General Director, TOTAL E&P RussieChief Representative of TOTAL Group in Russia

2 For Russia Offshore Conference, Moscow, February 2-4th, 2010

TOTAL: Global Energy Group

- Exploration activities in more then 40 countries

-Oil and Gas production in 30 countries

-Position as one of the global leaders of in the natural gas

and LNG markets

- No. 1 in Western European refining/marketing and No. 1 in African marketing

- Among the leaders in specialty products markets with products marketed in 160 countries

-Leading trader of oil and refined products worldwide

-Total is one of the world’s largest integrated chemical’s producers

- The segment include Base Chemicals (petrochemicals and fertilizers) and Specialty Chemicals (rubber processing, resins, adhesives and electroplating activities)

Upstream Downstream Chemicals


TOTAL: more than 40 years of oil and gas resources

Increasing portfolio diversification:

13 countries with more than 500 Mboeof proved and probable reserves at end-200818 countries with more

than 500 Mboeof resources

Proved and probable reserves : 20 Bboe

SEC Production 2008: ~ 2.34 MBoepd62% liquids 38% gas

Norway

Kazakhstan

Angola

Nigeria

Canada

United Kingdom

Qatar

≥ 1 Bboe 0.5 - 1 Bboe ≤ 0.5 Bboe

VenezuelaUAE

IndonesiaYemen

Congo

Australia


TOTAL in Russia

4


Offshore gas reserves in RussiaRussia - indispensable investment destination for TOTAL

Barents & Pechora52 tcm

Kara36.5 tcm Laptev

2.2 tcm

E. Siberean3.4 tcm

Chukotsk2 tcm

Bering0.7 tcm

Okhotsk6.3 tcm

Caspian2 tcm

Source: Ministry of Natural Resources

Black & Azov0.9 tcm

More then 100 tcm of offshore gas reserves and resources


TOTAL in Russia

185

43

0

40

80

120

160

200

World Russia

World Gas Reserves (tcm)

3066

602

0

500

1000

1500

2000

2500

3000

World Russia

World Gas Production (bcm/a)

82

9

0

10

20

30

40

50

60

70

80

90

World Russia

World Oil Production (mbpd)

Russia - indispensable investment destination for TOTAL

In 2008 –Russia held 23% of world’s gas reserves

and produced 20% of world’s total production

Source: BP Statistical Review, 2009

1260

79

0

100

200

300

400

500

600

700

800

900

1000

1100

1200

1300

World Russia

World Oil Reserves (Bln bbl)

In 2009 –Russia was world’s largest oil producer


TOTAL in RUSSIA

20 years of presence in Russia

10 years of production

Today: Involvement in three projects Kharyaga PSAShtockman gas fieldTermokarstovoye gas and condensate field

Tomorrow: Khavalynskoye field in the Caspian Sea

TOTAL has a long-term commitment for Russia


TOTAL in RUSSIA

Partnership with Russian companies Existing or past projects with:

GazpromNovatekTatneft

Maximization of local context Share of Russian contractors every year

comprise 70 percent in Kharyagaoperations

Social investments, personnel development, environment protection

Total’s way to work in Russia

TOTAL develops sustainable business


TOTAL in RUSSIA

“Relations between Russia and Total being developed in a

very positive way. We are ready to consider your interest

to further invest in Russia.”Vladimir Putin,

Meeting with Christophe de Margerie,

24 June 2009

“Total’s strategy is oriented toward joint projects and cooperation… We perfectly realize that we have to involve Russia’s internal resources therefore contributing to Russian companies’ development.”

Christophe de Margerie, Chief Executive Officer, Total SA

TOTAL develops sustainable business


A challenging project:Located in the Nenets OkrugHarsh weather conditions (+15C in summer / -

45/50C in winter), difficult logistics due to remote location, sensitive environment

Oil with high wax and H2S content; carbonate reservoirs

An example of international projectTotal 40% (EU), StatoilHydro 30% (Norway),

Zarubezhneft 20% (Russia)*, Nenets Oil Company 10% (Russia);

Current status2008 – launch of Phase III (production increased

to 30,000bpd; gas utilization under progress)

TOTAL’s PolicyPriority to local contractors with the required

level of qualityEfforts to maximize involvement of Russian

companies and Russian staff

TOTAL in RUSSIAKharyaga project –

10 years on production in October 2009

*From 1/1/10


TOTAL in RUSSIA

Unprecedented scale:reserves of 3.7tcm (1.3 years of world

consumption)Phase I production of 23.7 Gm3/an to be

transported via LNG trains and Nord Stream to EU marketsPhase I annual production is equivalent to

some 50% of France’s annual gas consumption

Unprecedented challenges:550 km offshore at the depth of 340 metersextreme weather conditions & sensitive

ecosystems

Innovative contractual framework:

• SDAG organized by Gazprom(51%), Total (25%) and StatoilHydro(24%) to bear risks and share revenues for 25 years from field start-up;

• Gazprom owns 100% of the Shtokman license holder (GazpromDobycha Shelf) and retains all marketing rights

Shtokman – reaching new level


Total and Novatek signed Heads of Agreement (HoA) towards the creation of a 49/51 JV, called Terneftegas

Terneftegas holds the licence of Termokarstovoye gas and condensate field in YAMAO:

47 bcm gas10 mt liquids

First gas to be delivered in 2015

TOTAL in RUSSIATERNEFTEGAS - JV with NOVATEK: opening new opportunities

Photo siberie


Heads of Agreement (HoA) signed on 6 October 2009, providing Total an opportunity to join development of the field.

Khvalynskoye is a gas and condensate field located in the Caspian Sea on the border of Russia and Kazakhstan.

Water depth – 25 meters.

The gas produced from this field will betransported to Russia.

Under the HoA, the field will have the following shareholder structure:

Lukoil (operator) – 50%Kazmunaigas – 25%Total – 17%GdF Suez – 8%

TOTAL in RUSSIAKHVALYNSKOYE – JV with Lukoil, Kazmunaigaz and GDF Suez


TOTAL: leader in development of OFFSHORE projects

14


Offshore Portfolio Worldwide

North and Barents Seas: Norway, UK, The Netherlands

West Africa: Angola, Nigeria, Congo

Middle East: Qatar

South East Asia: Indonesia

Caspian region: Azerbaijan, Kazakhstan

Gulf of Mexico: USA

Total is a leader in development of giant offshore and deepwater projects

Offshore experience in every part of the world


Discovered in 2000. Production start –March 2009

150 km off the Niger Delta, Water depth - 1400 m

Plateau 225 kboe / day

Total is the operator with 24% of shares

One of the largest deep offshore development in the world

High level of local content

Offshore Expertise - Nigeria

Deep Offshore: Nigeria, Akpo project

First time in the world –deep offshore development involving light oil with a high gas

content


Offshore Expertise - Angola

Deep Offshore: Angola, Dalia project

Discovered in 1997. Production since 2006.

Lies 135 km offshore Angola. Water depth – 1200 - 1400 m, field area – circa 230 km2.

Reservoirs buried 700 to 900 metersbelow the seafloor and holding heavy, acidic oil

FPSO able to treat 240,000 barrels of oil per day

Plateau 240 kboe /day

First time in the world –on a such a scale Dalia combined the technology of horizontal

subsea Christmas trees with light well architecture


The project involves development of four fields: Perpetua, Hortensia, Zinia and Acacia, discovered in 2000-2003.

150 km offshore Angola, water depth from 600 to 1200 m, field extension – 600 km2

The project will handle heavy oil (17°-22°) and lighter oil (35°-38°) simultaneously.

Drilling started in 2009, production starts in 2011

Plateau 200 kboe / day

Offshore Expertise - Angola

Deep Offshore: Angola, Pazflor project

First time in the world –usage of seabed gas/liquid separation right next to the

production wells


Offshore Expertise – Caspian Sea

Caspian Offshore: Kazakhstan, Kashagan project

Discovered in 2000. First phase to start producing in 2012.

Plateau of the first phase - 300 kboe / day

Total’s management system is applied in Kashagan development company, NCOC.

Reservoir at 4,000 m, High Pressure (800 bars), Presence of H2S (15% reservoir fluid).

Extreme continental weather conditions (-40C - +40C)

Participants:KMG – 16.8%ENI – 16.8%ExxonMobil – 16.8%Shell – 16.8%Total – 16.8%ConocoPhillips – 8.4%Inpex – 7.5%

The largest oil development project


Located in the UK sector, 240 km east of Aberdeen. Deepest reservoirs in the North Sea – 5,500 m

Construction started - July 1996, production started - September 2001

Temperature and pressure conditions among the highest in the world - HP / HT (1100 bar, 190C)

Combines three fields – West Fanklin, Elgin and Kessog

Plateau 13 bcma of gas and 7 mt of condensate per annum

Offshore Portfolio WorldwideNorth Sea: Elgin Franklin

The largest development in the North Sea since 1980


Located in the Norwegian sector, 140 kmnorthwest of Hammerfest, at 70° northlatitude

Production began in 2007

No fixed or floating units are positioned inthe Barents Sea. Instead, the subseaproduction facilities stand on the seabed, in water depths of 250-345 metres.

The project includes three fields -Snøhvit, Askeladd and Albatross

Plateau 5.7 bcm per annum

Total share: 18.4%

Offshore Portfolio WorldwideBarents Sea: Snohvit

First offshore development in the Barents Sea and first Europe’s LNG exporting project


Offshore Portfolio WorldwideBarents Sea: Pl 535

PARTICIPANTS:

Total E&P Norge AS (Operator): 40% Aker Exploration AS : 20% North Energy AS: 20% Rocksource ASA: 20%

License received in April 2009

Located on the Norvarg Dome in the central part of the BjarmelandPlatform in the Barents Sea, 200 km offshore

3D seismic completed over the summer of 2009

First well planned for 2011

ShtokmanPL 535Snohvit


TOTAL: excellence in management of complex projects

23


Shearing Expertise in RussiaBrining to Russia leading technologies

Floating Production Unit (FPU) used in Akpo project in Nigeria

LNG PLANT

Total will bring FPU technologies used by Total in Nigeria to Russia

Technology transfer

Technology transfer

AKPO

Projected FPU for Shtokman

LNG PLANT

SHTOKMAN


Dolphin (24.5%)

TOTAL: Successful Execution of Operated Projects

Proven track record for delivering major projects in line with budget and schedule,

resulting in:1,3 mln boed put in production within 3,5 years

Plateau : 90 kboe/d, producing since April 2008

Moho Bilondo (53.5%)

Plateau : 240 kboe/d , producing since end-2006

Dalia (40%)

Plateau : 195 kboe/d, production start -November 2009

Yemen LNG (39.6%)

Plateau : 150 kboe/d, producing since June 2007

Rosa (40%)

Plateau : 385 kboe/d., producing since July 2007

Jura (100%)

Plateau : 45 kboe/d, producing since April 2008

Akpo (24%)

Plateau : 225 kboe/d, producing since March 2009


UAE

Saudi Arabia

Oman

Qatar

Integration: Qatar North Field Value Chain

Qapco (20%) LDPEQatofin project (22%) :1.3 Mt/y ethane cracker Start-up : 2008(e)

Petrochemicals

Dolphin project (24.5%)Capacity > 2 Bcf/dProducing since 2007

cond

ensa

tes

Qatargas (10%) : 9.9 Mt/yQatargas II (16.7%) : 7.8 Mt/y

Gas liquefaction plants

Gas pipeline

Capacity : 146 kb/dStart-up : 2009 (e)

Ras Laffan refinery (10%)

ethan

e

methane

methane

Taweelah power/water plant (20%)

Power capacity:1,4 GWWater capacity : 0,4 Mm3/d

Research Centre

1500 m2


Management of Integrated Teams

HR

IT

Finance

GeneralManagement

HSE

R&D

LegalOperations

Geosciences

Drilling

Communicationsand relations withstakeholders


TOTAL: technological advancement

28


TOTAL: investments in the future

A mandatory foundation for a Major1.1 B$ TOTAL Group R&D in 2008

Sour gas

CO2 sequestration

Tight gas

Arctic

Imaging

Heavy oil

Deep offshore

HP / HT


Lacq deep gas reservoir

OxygenProduction

Unit

Lacq gas production

1

Natural gas inlet

2

Lacq gas treatment plant

3

Commercial gas

4

UtilitiesBoiler oxycombustion

5

CO2

6

CO2 Transportation

7

Compression

8CO2 injection

9

CO2 storage

10

4000 m

4500 m Natural gas

Steam

Purification / CO2 dehydration

Compression

Rousse reservoir

CO2 injection

CO2 transportation

CO2 capture

Gas production

TOTAL pilot of CO2 sequestration in Lacq, France


TOTAL: R&D Arctic program in Norway

Sea ice modelling in the Marginal Ice Zone - NERSC

Oil in Ice - Sintef

Cold Climate technology project -Norut

PhD Thermo-Mechanical Response of 1st Year Landfast Sea Ice -University of Svalbard

Cold Wear - Sintef & NTNU possible participation


TOTAL: local development

32


Maximization of local content

TOTAL seeks to maximize share of local contractors in all operating countries.

In Shtokman:

SDAG set special requirements for Russian contractors in the company’s contract and bid procedures

Transparent bid procedures with pre-bid qualification is established

Special seminars to communicate SDAG policies are held regularly in Moscow, Murmansk and Arkhangelsk.

In Kharyaga:

Share of Russian contractors every year comprise 70 percent

Russian contractors perform large scale operations: BK Eurasia –Workover, Flint Eurasia –Construction.


TOTAL in Russia: local development

3 priorities: EDUCATION, HEALTH, CULTURE

Partnering with local communities and contributing to social, economic and cultural development

Investment in education of employees, supporting international assignments, partnering with Russian universities


Listening and mutual respect

Technological excellence

Added value to integrated projects & contractual innovations

Industrial safety, environmental and social responsibility

TOTAL in Russia: building partnerships of trust

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