Total SA plans to invest USD 500 million a year to build profitable businesses in new energies, according to Patrick Pouyanné, CEO. The French company said in a presentation to investors on Sept. 23 that it wanted to take “advantage of the fast-growing renewable market.”
Total bought a majority stake in SunPower Corp., one of the largest manufacturers of solar panels in the U.S., for about USD 1.4 billion in 2011. The company also announced earlier this year that it would invest EUR 200 million (USD 223 million) to transform its unprofitable La Mede oil refinery into a biofuel plant.
The USD 500-million investment announced by Total comes four months after Pouyanné pledged to lift spending in renewable energy. The spending in renewable energy is, nonetheless, a fraction of the company’s overall investment of as much as USD 23-24 billion this year, from the peak of USD 28 billion in 2013. The company will further reduce investment to USD 20-21 billion in 2016, before returning to a sustainable level of USD 17-19 billion from 2017 onwards.
Total re-stated its commitment to an integrated oil and gas business model and said it plans to allocate 75% of its capital employed to its upstream business and 25% to its downstream business.