TotalEnergies to hike dividend and oil production, de-risk gas to 2030
Company to increase dividends per share by 5% in 2025
Can maintain buybacks under $70 per barrel
Board supports selling shares in New York
Targets 3% annual growth in oil and gas production to 2030
Adds news on New York-listed shares in paragraph 2 and update on Mozambique LNG project in paragraph 10
By America Hernandez
PARIS, Oct 2 -French oil major TotalEnergies TTEF.PA told investors on Wednesday it would focus on low-cost upstream production and signing oil-linked gas contracts to operate profitably and reward shareholders through 2030 as prices fall.
CEO Patrick Pouyanne also said the board of directors had voted in favour of converting the American Depository Receipts (ADRs) currently sold on the New York stock exchange into company shares "if technically feasible", in a bid to boost liquidity and ease purchases by U.S. investors.
Total announced a 5% increase in dividends per share for 2025 and $2 billion in buybacks per quarter, stating the company could borrow to sustain that rate if needed thanks to its low debt-to-equity ratio and high credit rating.
"Our dividend breakeven is under $50 per barrel ... and we can sustain buybacks under $70 per barrel," Pouyanne said.
Brent crude dropped below $70 per barrel last month from above $90 in April, prompting some analysts to cut share price forecasts on oil and gas producers and worry the firms may have to slow dividend payouts and share buybacks.
Total is targeting upstream production costs of $5 per barrel this year, and sought to reassure investors it would be able to navigate the global glut of liquefied natural gas set to hit from 2027 to 2030, when some 50 million tons of new supply per year are set to come online.
Stephane Michel, the company's president of gas, renewables and power, admitted that "we could be in a situation where we have more supply than sales", as Total's portfolio of American LNG bought at the U.S. Henry Hub benchmark price grows.
"We are working on closing the difference between supply and sales — for 2030 we will on one side buy Henry Hub, and only sell (contracts linked to) Brent (prices)," Michel said.
The company hiked its oil and gas production target to 3% annual growth to 2030 from 2-3% growth to 2028.
The Mozambique LNG project in which Total is the biggest stakeholder, under force majeure since 2021, will restart once three remaining financiers representing 20-30% of the project's $14 billion package reconfirm commitment.
Its total energy production is now forecast to increase 4% annually, with $10 billion more in free cash flow by 2030.
TotalEnergies' 24 gigawatt renewable portfolio - larger than those of BP, Shell, Equinor and Eni combined - is currently set to jump 45% to 35 GW by next year, with a goal of 70% of the company's electricity in 2030 coming from renewable sources.
The company said it expected to return 45% of its cash flow to shareholders this year.
Reporting by America Hernandez and Benjamin Mallet in Paris; Editing by Kirsten Donovan, Mark Potter and Jan Harvey
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