French oil and gas giant Total will cut capital spending by 10% this year in response to the falling oil prices, according to media reports.
The Financial Times reported that capital spending is expected to fall between $2bn and $3bn from last year’s total of $26bn.
The cost- reduction plans are posed to slash 30% off Total’s exploration budget from $2.8bn to less than $2bn, its newly appointed CEO Patrick Pouyanné told FT.
The international oil company is also looking at imposing a hiring freeze for 2015 as a number of IOCs and oilfield service companies announced significant job cuts last month.
Pouyanné said Total would press ahead with a restructuring of lossmaking refineries in Europe, while reforms to refineries in France will include “capacity reductions” in the spring.
“We have some assets on which we may need to make some efforts,” he said. “We have three assets [of this nature], one of them being in the UK, but we have some in France [as well].”
“When you have a plant losing more than €100m a year, it’s not sustainable. And it is my duty to find solutions . . . We are losing money and it doesn’t work,” he added.
