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Posted on Monday, 22 April 2013 17:23

There is a fresh impetus to our exploration - Total Oil

Jacques Marraud des Grottes Senior vice-president Africa for exploration and production, Total/Photo©Vincent Fournier for JAAfter a decade of booming oil prices and the rise of new entrants into the African market, Total is responding with an aggressive new exploration strategy.

 

One cannot easily accuse France's Total of resting on its African laurels. It has been behind the development of cutting-edge deep-offshore technology and in the past few decades has emerged as the largest oil major operating on the continent, with huge discoveries to its name.

There is a suspicion that the success of smaller companies like Tullow, Anadarko, Maurel & Prom and Afren has led to some uncomfortable meetings at Total Tower, the French major's home in La Défense, Paris.

Total chief executive Christophe de Margerie has repeated several times over the past few years: "Total will again start taking risks."

Jacques Marraud des Grottes, Total's senior vice-president Africa for exploration and production, sees majors and juniors as complementary: one has the real estate, the other has the technology and finance.

Behind the scenes, Total is bolstering its own exploration teams to confront a busy period.

TAR: Is Total in the running in East Africa?

Jacques Marraud des Grottes: We are clearly in the race. We are with Anadarko on five permits in Kenyan deep offshore, from 300m-3,000m in the Lamu Basin, an area of around 25,000km2. The seismic work is now done and the first wells are being drilled in early 2013. We are present in Uganda with Tullow and CNOOC [China National Offshore Oil Corporation], each with a one-third share of the Lake Albert find.

Currently we are defining the project specifications in Uganda, as well as continuing to explore before the licences run out so that we can do an inventory of the area.

We are present in South Sudan. We are exploring with Petronas in Mozambique, with two offshore blocks of around 15,000km2 in mostly deep offshore.

There is a fresh impetus to our exploration – more audacious, more risk-taking – and we are the most active major in Africa, where we took out 20 permits in 2011-2012.

We are looking for well-known geological formations in new locations, like Uganda; new geological formations where we already are, such as the pre-salt basin in Angola; and also new geological formations in new countries – so for us that is Côte d'Ivoire, in the [West Africa] Transform Margin.

Is it fair to say that it is the min- nows who have done the hard work in 'de-risking' African oil?

You have to hand it to the Africa-focused juniors, as they were the ones to find what we now call the Transform Margin. Now we are partners when they need to develop or monetise resources, as in Uganda, or as exploration partners, as in Côte d'Ivoire and Kenya with Anadarko. We have the expertise in developing deep offshore, where we are by far the leader.

We operate 1 million barrels in Africa and 6 FPSOs [floating production, storage and offloading units]. The current leading edge of our technology is to develop several smaller fields, all tied back to the same FPSO.

Did Total pay over the odds for its Côte d'Ivoire blocks in February 2012?

We have the CI-100 block, and to that we have added three other blocks. They are risky, so we know the probabilities of success are not high. But given the stakes, we are satisfied with the eco- nomic terms that we got, and we have no regrets from our negotiations in Côte d'Ivoire. They were competitive.

We will drill a first well in early 2013 [in CI-100]. On our new blocks, we already have completed our seismic work. It's a risky but prospective zone. We are happy to be there, and we are currently investing. We paid market prices to access these blocks. And even if we hit a dry well, we are not concerned. Rome wasn't built in a day. Our biggest success, Block 17 in Angola, had a dry well at the beginning, so give us time.

Remember, Total is the largest operator active in Africa today in deep offshore. It's because our exploration teams found all these great finds five, 10, 15 years ago. It was Total and a few others who created the movement towards deep offshore in Africa. We have the experience and the local presence.

What advice would you give Mozambique to help it avoid the worst excesses oil can bring?

It's hard to give advice to states. First, you need to accept to be open and know what you are doing. Governments need to be predictable and put in place long-term strategies so that both the investors and the public know where they are going.

You need to have transparency and clear reporting of what is happening too. And you need a legislative environment that is sufficiently protective of the investor but also gives a fair split. In our business there is nothing to hide●



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