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Bloomberg: Total sees no project delays

Thursday, 8 June, 2006
AMSTERDAM: Total SA, Europe’s third-largest oil company, said it doesn’t expect to delay oil and gas projects, after rising costs forced competitors such as Royal Dutch Shell Plc to reconsider some energy investments.

Paris-based Total expects no delays to projects such as the $3.7bn liquefied natural gas project in Yemen scheduled to start in 2008 and the Dolphin project in Qatar, chief executive officer Thierry Desmarest said at a press conference at the International Gas Union Conference in Amsterdam yesterday.

“Up to now, we have been able to continue without postponing projects,’’ Desmarest said. “We have not had to really delay projects and don’t expect to at this stage.’’

Desmarest is avoiding more expensive technologies such as converting gas to liquid fuel, in an effort to keep Total’s costs among the lowest in the oil and gas industry.

Shell, Europe’s second-largest oil company, said May 5 rising costs may delay some projects. The costs for Shell’s Sakhalin project in Russia have about doubled to $20bn.

Gas-to-liquids technology, which makes diesel from natural gas, originated in Nazi Germany when it ran short of petroleum fuel. It was developed further in South Africa during the trade embargo of the apartheid era.

“We have not been the most enthusiastic on gas to liquids in the past,’’ Desmarest said. “We don’t expect huge developments.”.

Total will continue research and development of gas-to-liquids projects, looking for “some possibilities of a better outlook,’’ Desmarest said. – Bloomberg

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