Energy Intelligence - TotalEnergies' Transition: More Renewables, More Gas

TotalEnergies changed its name from Total in May 2021, promising the move will be accompanied by a genuine transformation into an “integrated multi-energy” company that will see the French major begin the journey to less oil. The company has embraced a goal of net-zero emissions by 2050 and now factors in a $100 per ton CO2 equivalent price in all its project evaluation processes. Its gas business would grow and involve an increasing share of biogas and added measures to control methane and CO2. The company also envisages a shift in its energy sales by 2030 to a gas-heavy mix comprising 50% gas, 30% petroleum products, 15% of “majority-renewable electricity” and 5% of biomass and hydrogen. Such a shift, says the major, would result in a reduction of at least 20% in lifecycle carbon intensity of its energy products by 2030.

The company aims to peak oil production within this decade, ramp up gas output by around 50% by 2030 versus 2015 levels, and significantly up its electricity output from 21 terawatt-hours (TWh) in 2021 to 120 TWh in 2030. In an interview at Singapore International Energy Week, Julien Pouget — TotalEnergies’ Senior Vice President for Asia-Pacific E&P and Renewables — elaborated on the company’s transition strategy and shared details of its progress.

Gas With CCS

“We are convinced that LNG is a key transition fuel because it allows [the world] to displace coal. It also complements the current renewables, which are intermittent,” Pouget told Energy Intelligence. To ensure that gas is affordable, TotalEnergies is developing new capacity such as the 6 million ton per year Papua New Guinea (PNG) LNG project, which is “ideally positioned geographically to bring more LNG to the Asian market.” The company is also the first international partner selected by Qatar for the North Field East and North Field South gas projects.

In PNG, TotalEnergies will be implementing “first-day reinjection” of CO2 into reservoirs. “So it's kind of carbon capture and storage (CCS) integrated [into the production process] from day one,” said Pouget, adding: “This is also what we are working on for the Ichthys [LNG] project in Australia where we, together with our partners, have been awarded a CCS appraisal and a CO2 storage appraisal license in the Bonaparte Basin.”

Renewables Ambitions

The company is swiftly building up a portfolio of renewable energy projects, although the current ratio in its overall assets is still small, said Pouget. Installed gross renewable generation capacity reached 16 GW (including from acquisitions) at the end of the third quarter of 2022, up by 4.4 GW from the previous quarter. The company also has 5.4 GW of renewable capacity under construction and another 46.4 GW in the development pipeline. By 2025, TotalEnergies expects to have 35 GW of operational renewable generation capacity. The company is targeting a near tripling to 100 GW by 2030, so it would be “among the top five players in the renewables space,” said Pouget.

The use of renewable electricity to produce green hydrogen is also part of TotalEnergies' energy transition strategy. The French major in June announced its foray into Asia’s hydrogen space by taking a 25% stake in India’s Adani New Industries, which has a project for producing 1 million tons/yr of green hydrogen by 2030.

Solar Heavy

Solar projects account for the majority of TotalEnergies' renewable energy assets. “The major share is solar because this is where we started,” said Pouget: “Now if you look at what we are building in our portfolio, there is still a lot of solar.”

TotalEnergies and its partners recently completed and inaugurated a giant solar farm — the Al Kharsaah project in Qatar — with a maximum output of 800 megawatts at peak. Al Kharsaah can supply 10% of Qatar’s peak power consumption and avoid 26 million tons of CO2 emissions during its lifetime. The project is a joint venture between affiliates of QatarEnergy Renewable Solutions, Japan’s Marubeni and TotalEnergies. Meanwhile, in Southeast Asia, TotalEnergies is in a joint venture with Japan’s Eneos to develop distributed solar projects, targeting a total capacity of 2 GW over the next five years.

Offshore Wind Synergy

Offshore wind, which entered TotalEnergies' portfolio in early 2020, is starting to see an increasing share. Its current offshore wind portfolio stands at over 11 GW, spread across the UK, France, South Korea, Taiwan and the US. Like most majors, TotalEnergies sees a “big synergy” between its existing oil and gas activities with offshore wind. “It's not only technical synergies, but also project execution synergies, and the fact that some of the subcontractors are common to both industries,” Pouget noted.

The company's preference for scale also makes offshore wind an attractive option: “We have grown our [offshore wind] portfolio very significantly over the last two years and we like it because it's large projects, where we can leverage on our competencies and our capabilities the most,” said Pouget.

The company’s 51%-owned Seagreen project offshore Scotland began first power generation in August. Its other giga-scale joint venture offshore wind projects in the UK include the 2 GW West of Orkney Windfarm and up to 1.5 GW from Outer Dowsing off the Lincolnshire coast. In Asia, Total’s 23%-owned Yunlin offshore wind farm in Taiwan commenced first generation in late 2021.

Reproduced with permission from Energy Intelligence Group