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EXTRA HEAVY OILS

IN THE WORLD ENERGY SUPPLY


Ladislas Paszkiewicz

Senior Vice President Americas

CSR Field Trip Canada, June 2012

Increasing need for fossil energies by 2030


Energy mix scenario
Mboe/d

4%
3%

Solar, wind, others


Hydro

11%

Biomass

6%

6%

Nuclear

24%

22%

Coal

23%

24%

Gas

33%

31%

30%

Oil

2010

2020

2030

2%
3%

300
1%
2%
10%
6%
200

11%

26%

100

22%

CSR Field Trip Canada, June 2012

In 2030:
Gas to become the
second-largest energy
resource

Oil will still represent


30% of global energy needs
Extra-heavy oil and oil
sands will contribute
to 7% of liquid
hydrocarbon supply
Increase in the demand
for both renewable energies
and fossil fuels

Extra-heavy oil, a major resource to be developed


Worldwide oil resources
~3,500 Bboe

100
80
Years of
production
at current pace

35

~500 Bb of extra-heavy oil


Oil shale
Extra-heavy oil
(incl. oil sands)
Tight oil

Unconventional
resources

ultimate resources*, incl. oil


sands (16 years of world
liquid hydrocarbon production
at present pace)

Yet to find and


increased recovery rate

Of which 50% in Canada

Identified conventional resources

Rest: Venezuela, Nigeria,


Brazil and Russia

Already produced

Challenging resource requiring advanced


technology and significant investments
* Includes resources that can be recovered economically with todays technology as well as resources currently non economically
recoverable with todays technology
CSR Field Trip Canada, June 2012
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Need for liquid hydrocarbons partly fulfilled


with extra-heavy oil in the future
Worldwide extra-heavy oil production forecast
(incl. oil sands) Mb/d

+6%

1% per year overall


average liquid hydrocarbon
production capacity
increase from 2010 to 2025

per year

2005

2010

2015

2020

2025

6% per year overall


average extra-heavy oil
(incl. oil sands) production
capacity increase from
2010 to 2025

Crucial to ramp up the production of heavy oils to offset


the inevitable decline in conventional production
CSR Field Trip Canada, June 2012

What are heavy and extra-heavy oils?


2 characteristics by definition:

Gravity: very dense, between 7 and 25 API


Viscosity (at reservoir conditions): highly viscous, from 10 up to over 10,000 cP
Heavy and extra-heavy oils

3 categories of heavy oil:

Mobile

Non mobile

Categories

Totals definition

A Class
Heavy oil

Gravity < 25 API


10 < Viscosity < 100 cP

B Class
Extra-heavy oil

Gravity < 20 API


100 < Viscosity < 10,000 cP

C Class
Oil sands bitumen

7 < Gravity < 12 API


Viscosity > 10,000 cP

For convenience purposes, in general terms heavy oils include categories A+B+C,
and extra-heavy oils include categories B+C, i.e. extra-heavy oils and oil sands

CSR Field Trip Canada, June 2012

Bitumen

Huge volumes of heavy oil in place


Split by category

Split by region

Africa

Far East

C Class

CIS

Middle East

A Class

oils sands
& bitumen

medium/heavy oil

~1,940 Bb

34%

4,000 Bb

34%
South America
~1300 Bb
95%
in Venezuela

44%
44%

9%

50% 4,000 Bb
North
America
~1800 Bb
94%
in Canada

~80% in Americas
~90% for extra-heavy oil and bitumen
CSR Field Trip Canada, June 2012

41%

B class

extra-heavy oil

Heavy oil production technologies: depending on


viscosity, depth and complexity of reservoir
Non-mobile oil

Mobile oil
Complexity of reservoir

20 m
Currently
mined

Electrical heating
100 m
R&D

Depth of reservoir

new
technologies

Other technologies

In situ production
for homogeneous reservoir

(combustion, microwave...)

Thermal production:
steam assisted gravity
drainage (SAGD)

Heterogeneous reservoir

Radio frequency

In situ
production:
cold production
Enhanced oil
recovery:
Enhanced
water injection

New technologies are needed to improve recovery


and access all reservoirs
CSR Field Trip Canada, June 2012

(EWI)

Thermal

Thermal or cold production for in situ production


Viscosity cP
10 000 000
1 000 000
100 000
10 000
1 000
100
10
1

50

100

150

Athabasca (Canada)

Reservoir temperature ~10C


Viscosity ~1,000,000 cP Bitumen

200

250

Reservoir
300 C temperature

Orinoco (Venezuela)
Reservoir temperature ~53C
Viscosity ~1,500 to 3,000 cP Mobile oil

Thermal production inevitable

Cold production possible

500 m

Downhole pump

500 m
500

1400 m

CSR Field Trip Canada, June 2012

What are the challenges?


Long production plateau (20-50 years)
Substantial investment required (upstream & upgrading)

Important CSR concerns including environmental and local content


Continue to improve development technologies
To lower CAPEX / OPEX along the whole of the value chain
To increase recovery rate for each reservoir configuration
To develop a broad range of upgrading solution
(for all developments and market conditions)
To minimize environmental impacts: CO2 emissions, water recycling, footprint

To develop oil sands in a sustainable way

Totals expertise and financial strength


are in line with these challenges
CSR Field Trip Canada, June 2012

Total diverse heavy oil portfolio


in strategic areas and techniques
Project

CANADA
Alberta

Production techniques

Fort Hills

Mining

Joslyn
Mining

Voyageur
Upgrader
Athabasca
EDMONTON
500 km

Capital

VENEZUELA
Orinoco belt

NLP

PetroCedeo

Calgary

PetroCedeo

CSR Field Trip Canada, June 2012

In situ
200 km

10

MUSCAT

Barcelona

Fort McMurray

Surmont
In situ

OMAN

Upgrader

CARACAS

Mining

Town

Niswa

Qarn Alam

Sur

<

In situ
Mukhaizna
200 km

In situ

Total in Venezuela, PetroCedeo (cold production)


VENEZUELA

Start-up: 2000 (upgrader: 2001)

Caracas

Capacity: 200 kb/d (upgrader: 180 kb/d)

Pto. La Cruz

PetroCedeo

Cumulated site CAPEX as of end 2011: $8 billion


(including upgrader)

Orinoco Belt

About 500 wells drilled and 2,000 additional wells


to be drilled to maintain production (up to year 2033)

upgrader
(Total: 30.3%)

PetroCedeo
(Total: 30.3%)

Field
production
facilities
(degasing

Multiple wells
gathered by pads

Crude

dehydration
powergen)

Upgrading
refinery
Diluted
extra-heavy
crude

Tanker
Synthetic
crude
(32 API)

Oil characteristics:

In situ viscosity:
Diluent

Diluent

Infield production
CSR Field Trip Canada, June 2012

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~3000 cP at 50C

Gravity: 7.5 - 8.5 API

Total in Canada, a strong base to grow production

Long-plateau projects with stable


production for 20-30 years
Expected production by 2020: ~200 kb/d

ALBERTA
Northern Lights (50%)
Mining
Fort Hills (39.2%)
Mining

High breakeven projects but with


interesting leverage to oil prices

Upgrader

Joslyn (38.25%)

As per alliance with Suncor, aligned


decisions in 2013 for all projects

Strong cash flow generation

Voyageur (49%)

Fort McMurray

Mining

Surmont (50%)
In situ
Total-operated
Partner-operated
Exploration blocks

Long term cash flow and leverage to oil prices


CSR Field Trip Canada, June 2012

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Total building a diverse and strategic portfolio


Increasing energy demand requires diversification of supply
Extra-heavy oil and oil sands contributing to 7% of liquid
hydrocarbon supply in 2030: key contributors to world
energy supply

Extra-heavy oil: a major segment of Totals growth strategy


Strong R&D commitment to increase recovery, to mitigate
costs, to improve energy efficiency, to reduce GHG emissions,
to limit environmental footprint and to preserve biodiversity

Sustainability, acceptability and responsibility remain


keys to success

CSR Field Trip Canada, June 2012

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Disclaimer
This document may contain forward-looking statements, including within the meaning of
the Private Securities Litigation Reform Act of 1995, notably with respect to the financial
condition, results of operations, business, strategy and plans of TOTAL. Such statements
are based on a number of assumptions that could ultimately prove inaccurate, and are
subject to a number of risk factors, including currency fluctuations, the price of petroleum
products, the ability to realize cost reductions and operating efficiencies without unduly
disrupting business operations, environmental regulatory considerations and general
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any obligation to update publicly any forward-looking statement, whether as a result of
new information, future events or otherwise. Further information on factors which could
affect the companys financial results is provided in documents filed by the Group with the
French Autorit des Marchs Financiers and the U.S. Securities and Exchange
Commission (SEC).
Financial information by business segment is reported in accordance with the internal
reporting system and shows internal segment information that is used to manage and
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items, such as adjusted operating income, adjusted net operating income, and adjusted
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comparison of income between periods.
Adjustment items include:

(I) Special items


Due to their unusual nature or particular significance, certain transactions qualified as
special items are excluded from the business segment figures. In general, special items
relate to transactions that are significant, infrequent or unusual. However, in certain
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(II) Inventory valuation effect

The adjusted results of the Downstream and Chemicals segments are presented
according to the replacement cost method. This method is used to assess the segments
performance and facilitate the comparability of the segments performance with those of
its competitors.

CSR Field Trip Canada, June 2012

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In the replacement cost method, which approximates the LIFO (Last-In, First-Out)
method, the variation of inventory values in the statement of income is, depending on the
nature of the inventory, determined using either the month-end prices differential between
one period and another or the average prices of the period rather than the historical
value. The inventory valuation effect is the difference between the results according to
the FIFO (First-In, First-Out) and the replacement cost.
(III) Effect of changes in fair value
As from January 1, 2011, the effect of changes in fair value presented as an adjustment
item reflects for some transactions differences between internal measures of performance
used by TOTALs management and the accounting for these transactions under IFRS.
IFRS requires that trading inventories be recorded at their fair value using period-end
spot prices. In order to best reflect the management of economic exposure through
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precludes recognition of this fair value effect.
(IV) Until June 30, 2010, TOTALs equity share of adjustment items reconciling Business
net income to Net income attributable to equity holders of Sanofi

The adjusted results (adjusted operating income, adjusted net operating income,
adjusted net income) are defined as replacement cost results, adjusted for special items,
excluding the effect of changes in fair value as from January 1st, 2011 and excluding
TOTALs equity share of adjustment items related to Sanofi until June 30, 2010.
Dollar amounts presented herein represent euro amounts converted at the average eurodollar exchange rate for the applicable period and are not the result of financial
statements prepared in dollars.
Cautionary Note to U.S. Investors The SEC permits oil and gas companies, in their
filings with the SEC, to separately disclose proved, probable and possible reserves that a
company has determined in accordance with SEC rules. We may use certain terms in this
presentation, such as resources, that the SECs guidelines strictly prohibit us from
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disclosure in our Form 20-F, File N 1-10888, available from us at 2, place Jean Millier
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on the SECs Web site: www.sec.gov.