New man in Total’s hot seat knows Abu Dhabi is key to the company
The new chief of Total knows the central importance of Abu Dhabi to the company and has been intimately involved in the negotiations to secure a new concession in the emirate, according to his senior colleagues.
Patrick Pouyanné, who was head of Total’s chemicals and refining division, had been tapped in 2011 as one of two potential successors by his boss, Christophe de Margérie, who died last week in Moscow in a runway accident involving his corporate jet.
The company moved quickly to appoint Mr Pouyanné and to bring back former chairman and chief executive, Thierry Desmarest, to act as chairman of the board until the end of next year, when he is expected to hand over that role to Mr Pouyanné.
The death of Mr de Margerie left many in Total and in the industry in shock as he had been a widely liked and admired personality, especially in the Middle East, where he had headed up Total’s operations in the 1990s.
“He loved the Middle East and he was a friend of Abu Dhabi,” said Hatem Nuseibeh, president of Total UAE of Mr De Margérie. “I used to joke and tell him he had Arab blood he loved it so much. He is irreplaceable.”
Mr De Margérie’s force of personality had been a big factor in his dealings with those at the top of the oil establishment. But the transition in terms of dealings with Abu Dhabi would be “seamless”, said Mr Nuseibeh, who began his career as an oil reservoir engineer at Adco in the 1970s. “A few hours after he died, I was given instructions to pass the message to people in Abu Dhabi – nothing changes with the death of Christophe de Margérie.”
It is an indication of the importance to Total of the UAE, where the company has had operations since 1939. Total’s UAE production last year was 260,000 barrels of oil equivalent, up 5 per cent from the previous year, and accounting for more than 10 per cent of its worldwide production.
The increase in production last year was mainly due to higher production by Abu Dhabi Company for Onshore Oil Operations. Total owns 75 per cent and is operator of the Abu Al Bu Khoosh field, and it has a 9.5 per cent stake in Adco, which operates the five major onshore fields in Abu Dhabi, and a 13.3 per cent stake in Abu Dhabi Marine, which operates two offshore fields.
The Adco licence expired in January this year and the Abu Dhabi authorities have issued a call for tenders for the renewal of the licence, the results of which are expected at the start of next year.
“Adco is central in our strategy,” Mr Nuseibeh said. The process has involved legacy companies – Total, Exxon, BP, Royal Dutch/Shell – being invited to bid last autumn to renew the concessions under new, less favourable terms, with follow-up “clarification” meetings thereafter with Adnoc officials. Adnoc will present its recommendations for a decision by the Supreme Petroleum Council.
“When I came to Abu Dhabi a year ago and we were preparing for all the high-level meetings, of course Patrick [Pouyanné] was part of the executive committee. I saw what he said and what he did for the Adco concessions meetings. He understands exactly the importance of Abu Dhabi,” Mr Nuseibeh said.
Mr Pouyanné was picked to lead Total partly because he is seen as a tough political operator. In France in the 1990s he had stints at the top level of domestic politics, working for former prime ministers Édouard Balladur and François Fillon. He comes from the rugby-playing south-west of France, is known for his big physique, dynamic approach and “sometimes volcanic” personality, according to Le Monde.
His Middle East experience includes a stint in charge of exploration and production in Qatar from 1999 to 2002, and more recently he has been in charge of downstream operations when Total opened the giant Jubail refinery in Saudi Arabia.
Apart from Adco, Total’s other assets in the UAE include a 15 per cent stake in Abu Dhabi Gas Industries, which produces natural gas liquids and condensates from the associated gas produced by Adco. Also, it has a 5 per cent stake in Abu Dhabi Gas Liquefaction Company and a 5 per cent ownership of National Gas Shipping Company, which owns eight LNG tankers and exports the LNG produced by Adgas.
Total has a 24.5 per cent stake in Dolphin Energy in partnership with Mubadala, a company owned by the government of Abu Dhabi.
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Updated: October 25, 2014 04:00 AM