Total, French integrated oil company clocked an 8% YOY decline in Q4 adjusted net income to reach EUR 2.9 bln (US$3.8 bln) due to steep decline in oil prices which curtailed production, the company's financial statement read. Assessing in dollar terms, the quarter's adjusted net income dropped 16%. Europe's No.3 oil company remained cautious when it announced an outlay of US$18 bln for projects in FY 2009, against US$19 bln in this fiscal.
Total posted a decline of 21% in adjusted net operating income for FY 2008 of its Chemicals segment to EUR 668 mln. In Q4 2008, the company's petrochemicals margins remained at satisfactory levels. However, the falling naphtha prices had an adverse impact on the production volume led by declining demand worldwide due to economic crisis. For FY 2008, the company's adjusted net income rose 14% to stand at EUR 13.9 bln. In FY 2008, the profits of company's Downstream segment, which includes the refinery business, witnessed a 41% rise. However, the Upstream segment's performance was hit by a massive decline in oil prices after it reaching peak in July leading Total to curtail Q4 production by 4% to 2.6 mln barrels of oil equivalent per day.
In Downstream and Petrochemicals, the Group will define the necessary changes needed to adapt its industrial assets to new trends in market demand for 2009 - 2010. The work on major construction projects are continuing, notably for the modernization of the Port Arthur refinery in the US, the Jubail refinery project in Saudi Arabia and the start-up of the Qatofin cracker in Qatar. In Upstream segment, the Group intends to maintain technical costs at the lowest level among the majors, thus preserving an important competitive advantage in a weaker oil market environment Also, Total is continuing with its efforts to improve the reliability of its facilities and to emphasize safety throughout its operations. Total also announced that it had already begun to implement company-wide productivity plans to reduce costs and to lower breakeven points for its operations.