French group TotalEnergies on Wednesday reported the highest profit in its history for 2023, based on the performance of its liquefied natural gas and electricity divisions.
Net income was $21.4 billion, up 4% from 2022.
The conclusion put the French energy conglomerate ahead of global peers Shell, BP, Exxon-Mobil and Chevron which reported lower profits in the face of lower energy prices.
However, TotalEnergies’ net earnings in 2022 had been weighed down by a huge extraordinary charge — $15 billion — from its withdrawal from Russia following the country’s invasion of Ukraine.
Once non-recurring items are removed, earnings took a sharp decline last year, with adjusted net income falling 36% to $23.2 billion.
Oil and natural gas prices fell about 10 percent on average last year from 2022, when surging oil prices had boosted profits at energy companies worldwide.
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Chairman Patrick Pouyan described the results as “solid”, saying in a statement that they were achieved in “an uncertain environment”. Hydrocarbons performed well, he said.
However, 2023 net income fell short of analysts’ forecasts, who were looking for as much as $23.7 billion.
The company’s share price fell about 1.5% in early Paris trading in response.
Controversial works
TotalEnergies has sought to diversify into low-carbon power generation, but continues to face criticism from environmental groups for its continued investment in fossil fuels because of their climate impact.
The group announced in September that it would increase hydrocarbon production by two to three percent annually over five years.
Several court cases against the company are pending, including land acquisition practices for controversial projects in Uganda and Tanzania that have been criticized by environmentalists.
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TotalEnergies is promoting the Tilenga drilling project in Uganda and the 1,443-kilometer (897-mile) East African Crude Oil Pipeline (EACOP) to transport crude to the Tanzanian coast.
Tilenga is targeting oil beneath the Murchison Falls Game Reserve in western Uganda with 419 wells planned, sparking fears for the area’s fragile ecosystem among the people who live there and environmentalists.
Drilling began in mid-2023 and production is scheduled for 2025.
TotalEnergies has argued that such projects are needed to meet global energy demand and points to its efforts to transition to low-carbon generation, particularly solar and wind power.
The energy giant has proposed a 7.1% increase in its annual dividend paid to shareholders.
Source: AFP