Growing output, strong refining help Total contain Q1 profit drop
PARIS, April 28 (Reuters) - French oil major Total reported a smaller-than-expected 22 percent drop in first-quarter net profit on Tuesday, helped by rising refining margins and sharp growth in oil and gas production that partly offset lower crude prices.
The start-up of three offshore projects in Nigeria, Norway and the British North Sea in the first quarter kicked off what is expected to be a year of strong output growth for the company, cushioning the impact of a 50 percent drop in oil prices.
"The group is benefiting from its organic growth strategy," Chief Executive Patrick Pouyanne said in a statement. Total is targeting an 8 percent increase in production this year.
First-quarter adjusted net profit was $2.602 billion. Revenue fell 30 percent to $42.313 billion, Total said.
Analysts on average expected $2.05 billion in net adjusted profit, according to Thomson Reuters I/B/E/S estimates.
Oil and gas production rose by 10 percent in the first quarter to 2.395 million barrels of oil equivalent per day, with 6 percent coming from the inclusion of a new concession in the United Arab Emirates that Total won this year.
The group became the first oil major to return to the concession for Abu Dhabi's biggest oilfields in January.
New start-ups, including Eldfisk II in Norway, Ofon 2 in Nigeria and West Franklin 2 off the coast of Scotland, brought an extra 4 percent in output this quarter, Total said.
The start-up of Russia's Termokarstovoye gas field in the second quarter, followed by GLNG in Australia, Laggan-Tormore in Scotland, Surmont 2 in Canada and Vega Pleyade in Argentina in the second half of 2015 are expected to boost output this year. Continuación...