Welcome everybody and welcome to Aberdeen. So I'd like to say that I think
you've been right actually coming all
of you to Aberdeen because you'll have the opportunity today to meet with all COMEX members. There are all of them in front of you. And so it will be very interesting and active day. So we'll start this morning with the presentation. This afternoon, we'll go to the we put in act actually what is being presented.
Proof of concept is very important. So let's start now. So before actually we do the presentation, we're going to start with a short movie about the highlights of 2019 and then Arnaud Broyak will review with safety moments. So let's start with the highlights of 2019. All right.
Now the floor is for Arnaud for the safety moment.
So good morning, everybody. Today, we decided to share with you a safety incident that occurred on one of our drilling units. We are offshore enroller on Block 17 on the 10th January of this year at 6:45 p. M. And so the rig is located on the one of the Zynia Phase 2 well.
And we are in the moon pool looking at the moon pool of the rigs, which is where the drilling river is going down the seabed. And we have 2 Seadrill personnel working on a mobile platform, as you see, working on installing flexible lines to the BOP, the gold presenter. And a third person that you will see a bit better when I will launch the video is actually assigned to the panel controlling the platform. So I suggest we
look at the video now.
So what happened? The personnel assigned to the panel attempted to move the platform closer to the riser And in doing that, he operated the incorrect lever. This caused the pins that are supporting the platform to retract and the platform fell to the seabed and sank approximately 1500 meters to the seabed. So what actions were taken? Immediately, all operations were stopped.
We recovered the 2 personas who were on the platform. There was a general safety stand down on the rig, full inspection of the riser from the surface to the seabed and recovery of
the platform maybe later.
There was a flash report to all drilling entities issued on the 17th January and a full investigation launched and a report issued on the 27th January. The first observation is that the 2 persons on the platform were saved by their lifelines. The use of proper PPE, which is one of our golden rules, was the last safety buyer and it played its role. The second observation is that the investigation revealed that 2 similar events had occurred previously on Seadrill rigs working for another operator. After these previous events, an action plan was defined, including first the installation of a secondary retention for the platform and second, an isolation of the handle activating the pins' reputation when the platform is in use.
These actions were not implemented by Cinera. So the second takeaway is that learning from incidents is critical and follow-up of safety improvement action is also critical. So finally, we asked the CEO of the Joint Contractor to come to our office to headquarters for the release of the event and he committed to improve on the company's mission
to learn process. Thank you. So good morning. Thank you, Arnaud, for this testimony. And I would like first, of course, to welcome all of you here in Aberdeen.
First time in our story that we made this result an outlook not in London or Paris, Aberdeen. I think it was we've done it for several purposes. 1st, because as you can see, there are some new faces in the executive team, not only Alex Zivoch as President for Marketing and Services, who took over from Momo Ma on January 1st January, but also our CFO, Jean Pierre, who begins to marry him and Helene as President of Strategy. And we thought it was a good opportunity to gather together for one day so that we have more opportunities to discuss and know them better and not only the previous members of the team. So it's one of the objectives today, which we will spend the day together here in Aberdeen to have more opportunities to discuss and to interact.
The second reason why we are here is also with us to pay tribute to all our UK teams and subsidiaries. They have done quite remarkable work since 2017, and we decided to acquire Mercurals. So we will have the opportunity also to see how we can work to in action, the action on, I would say, this merger or we derive the synergies or we have the new development as well, the Tulane development that's good on stream. So there is a lot of things to observe and to discuss. And so this afternoon, we will have the we'll come back on something which surprised a little when we decide to acquire Maerskol.
But North Sea is part of our strength of the company. We have decided to even rejuvenate this portfolio with Culhane, with Johan Zebroof as well, part of this portfolio. And I think it's part of the reasons of the strong results we delivered today. So it's a good opportunity for you to better understand how we can operate here in the UK and in North Sea. So coming back to this presentation as an introduction, of course, as we had a chance to see the results we faced in 2019, a weaker environment, I would say, an average of 20% 10% on crude, 40% on gas, more or less 20%.
And in front of it, we managed to demonstrate once again the resilience of the company. Net adjusted result is minus 13%. Net reserve by IFRS is almost the same. And more importantly, the cash flow delivery has been quite strong despite this weaker environment, plus €2,500,000,000 One of them is coming from the IFRS 16 rules, but the other are real cash, which of course is strong and it's linked to, I would say, cash flow growth. We will come back on all the explanations, but I would fundamentally say 2 things For me, it is the result of the 2 pillars of the strategy since 2015.
One of them is, of course, to focus all the company of delivery operational excellence. I think it's fundamental. I repeat each time, we don't know what the price will be. Volatility is strong. We don't control the price.
But our first duty of our teams around the world and the management is to deliver the most out of all the assets. And so it's a matter of safety. It's a matter of vulnerability of the plant. It's a matter of cost control. And this pillar is functioning well.
And for example, this year in petrochemicals, we increased again the availability, start up the reason why we managed this by lower petrochemical margin to maintain a good result. That's an example. We'll have others during the presentation. And the second pillar of the strategy, it was to be, what I say, fantastic, of course, since 2017 to be active in order to take some opportunities. And of course, this fit the growth and NERSCroll there again required at $60 The first two years of execution of production for NERSCroll in our portfolio was $72,000,000 last in 2018, dollars 64,000,000 this year.
Obviously, this helped to grow the cash out of operations. And the second, I would say, and dramatic acquisition we've done was the ENGIE assets, growing our LNG business. 2019 is really the year where all that is a combination of the ENGIE portfolio plus our own, I would say, development in LNG, like Ichthys, like Yamal, makes quite a strong puts of increase of production of almost 40%, more than 40%, the sales more than 50%. We'll come back on it. So I would say this strategy of the income of cyclicals and to play to our strengths in LNG, in the North Sea, in Africa with Anadarko assets, has some strong results and I would say, could produce the company in a good position.
So that's, I would say, the main message I want to deliver in introduction and Jean Pierre will come back on all the financial results. But before to give floor to so we'll make the presentation, we will have 7 voices today, not 1, not 2, 7. So, lots of FIES that are moving. So, I'm introducing, then Helle will present the macro development, then Jean Pierre will make the financial results. And then each head of the diligence will present its own results and outlook for 2020.
Arnaud for E&P, Bernard for Refining and Clinical, Alexis for Marketing and Services, Philippe for IGRP. And I will come back to speak about, I would say, energy transition and return to shareholders in the future for the conclusion. So before to leave the floor to Helmut, just two words about HSE. Like always, I'm taking that because it's fundamental. So the S of HSE is safety.
You've seen the safety moments. We continue to put a strong emphasis about safety. Again, I just said it's a cornerstone of all the operational excellence and we are all convinced of it. Statistics continue to improve, 0.8 total recordable injury rate among in the company. So it's a number of improvement.
Of course, and it's good for contractors, source of staff, both. We are, I would say, in the middle of the pack compared to our peers. So we can continue to improve. There's no way to start that journey. Unfortunately, I would say we deployed 4 facilities, which is not at the level of excellence we are targeting.
These 4 facilities were all coming from well, all concerning contracted staff, that's a point. There were all also impacted same call, which was 4th from 8, which of course obliges to remobilize everybody. And we put some working group together with the contractors of how can we reach 0 fatal accidents because obviously the only acceptable target we should have, 0 fatal accidents. So we put together with contractors, the teams of Total. Some decisions have been taken in terms of actions, in particular, no green light after some works on-site.
We need to have a special green light. I hope it will improve, but it's a concern, a big deal for all of us. We are really mobilized on these zero fatal accidents policy because it's something we should eliminate. The industry is suffering too many aircraft fatal accidents, but hotel is part of it. Another this chart on this slide, you have an example of what we speak about when we say the value of high safety standards.
This year was the 20 year anniversary of the AiryCar catastrophe. And we took the example this year of our shipping fleet to show you that we eventually, thereafter, we maintained the same strict policy. So it was not just a reaction, it's still a permanent policy. So the average age of our charter fleet is 8 years compared to a world fleet of 14. So we keep these standards, which help us not only to have with a modern fleet, I would say, higher safety standards, but also, by the way, it's good for CO2 because it's reduced consumption.
This fleet is the newest ships are consuming less and so less emissions, which gives my transition to my next slide. So safety, the CO2, which is the other priority, we elevated in 2019. We decided to elevate it for the still part of the same level of priority, I would say. And on each side, in total, today, you should see and if you don't see, you can't complain to me, but you should see on each side not only the safety statistics, but the CO2 emissions. It's a way to elevate the awareness of all the stuff about it.
And what we observed that there is quite a lot of positive reaction and environmentalism about the teams to try to contribute to fight these CO2 emissions and to contribute directly to the climate change. The Board of Directors decided at the beginning of the year to put the SCORP 1 and 2 objectives, not only a figure, but also it's linked to the variable pay of the CEO and all executives of the company. So we motivate everybody. We set the objective in an absolute terms, which is, I would say, a challenge because we want to grow. So we want to one side is less emission, but on the other side is more energy, which is, by the way, I would say, the global challenge of the world and we continue to deliver more energy but less emissions.
So we'll do it on our own limits, on our operated on the assets we control with the scope 1 and 2 target. We took the 2015 perimeter 46,000,000 tons. We want to be under 40,000,000 tons. The results of 2019 is 41.5 percent. So you could tell me your target is not ambitious, it's not true.
Because if you look carefully to this slide, you can see that the dark orange perimeter, which we have in 2015, is declining and the emissions are declining strongly. They are about in 2019, these are about 36,000,000 tons, which means that the decrease of 22% of this perimeter of 2015, 22% in 4 years. And in 2025, this perimeter will decline to around 30,000,000 tonnes, a decrease of more than a third of emissions. Of course, in the meantime, we continue to develop the company. So we acquire assets, we make some start ups.
So there are additional emissions on which the intensity should be, of course, absolutely controlled, which is if you need to be sure that these additional new emissions are really minimized as much as we can. So it's why the 46, we should become 40 in absolute terms. Of course, we'll do if we can do more, we'll do more. And again, the mobilization in the company makes me optimistic about it. In terms of intensity, you have on the right side, you can see that the upstream emission intensity of Total is at around 20 kilo CO2 per barrel, which is and the peers are between 22 and 35, these being the large the 5 key large measures.
And we want to lower this CO2 intensity under 20 with some of our in the E and P, we can that some of our colleagues are even targeting 10. So we can do better, that's clear. And this is part of new projects must have this type of standard. And so this is the first this is the results. If we look to a longer term, by the way, since 2,005, in 2,005, the company was emissions were around 80,000,000 tonnes.
So we are today around 40,000,000 tonnes. So that means that again, this matter is a permanent objective and today it's even more focused for company for obvious reasons. So this one my 2 introduction about HSE, I would say. And now I will leave the floor to Helene to speak about the markets.
Thank you, Patrick. Good morning, everyone. I hope you can hear me all right. So as always, we propose to refrain the business presentation with just a couple of macro charts, starting with oil and oil markets. What were the highlights for 2019?
And what's the outlook for 2020? According to the most recent data from the IEA, which is shown here in the bubbles on the chart, oil demand grew by 1,000,000 barrels per day in 2019. That number is subject to revisions, as always, because we are early in the year. But in any case, it's a little lower than the 3 year average, which was closer to 1,500,000 barrel per day. So good growth in 2019 for demand, but maybe somewhat disappointing.
On the supply side, the OPEC plus discipline has been on aggregate good and was step up in December with the additional $500,000 per day cuts, as you are aware. We call that a supportive policy from OPEC plus When it comes to refining, prices and higher product inventory levels in OECD countries put those refining margins under pressure towards the end of the year. For 2020 now, the IEA January report forecasted a pickup in demand growth for this year to 1,200,000 barrel per day. But then again, as always, this number is subject to upward and downward revisions. And right now, the markets are trying to get to grips with the impact of the virus outbreak in China.
Will it impact overall economic growth? Will there be demand instructions? I think very short term, immediately, as we're talking, the answer is yes, no doubt, because China is slowing down and sometimes stopping activity. But the real question is how many barrels will be lost and for how long. The markets are very nervous about these questions right now.
I think, honestly, it's a little too early to say. And let's just be careful not to overreact. On the supply side, in addition to the ongoing slowdown of shale production growth out of the U. S, Of course, geopolitical risk and instability is back on the front scene once again, notably in Iraq, also elsewhere in the Middle East and in Libya. OPEC plus cohesion is going to be a key theme this year, including the short term market management of the situation in China, with possible extension of the existing costs and ongoing discussions on more costs, corona costs.
Another key theme will be oil security, which cannot be taken for granted. For refining, we expect the beginning of the IMO regulations to be positive for business throughout the year. Moving on to petrochemicals, illustrated here by the ethylene and polyethylene markets. 2019 has been a good year when it comes to demand. The annual growth looks to be in line with the longer term 3% increase trend.
Asia, in particular, is driving that growth, pulled by China and by India. On the supply side, you know that the name of the game is access to low cost feedstocks and that worldwide capacities are split between ethane and naphtha crackers. We're showing here the historical margin trend in dollars per ton for 3 U. S. And European markets, specific segments, and we've annualized the margins because otherwise the graph would have been really hard to read.
What you can see is that U. S. Ethylene margins on ethane, so monomer margins, and that's the orange curve to the bottom of the graph. These margins have been trending downwards since 2015 and then really come under pressure due, if I simplify, to the wave of new crackers that came on stream ahead of the related new PE units. The integrated monomerpolymer margins, on the other hand, on ethane, have been faring much better, and that's the lighter blue curve on the top of the chart.
The darker blue curve shows the evolution of the same margin integrated monomer polymer on NASDAQ, which would be more representative of Europe and Asia, even if more and more crackers tend to be flexible, of course. The simple message is that monomerpolymer integration creates value, and Bernard will tell you more about that, I think. Coming to gas and more specifically to LNG. Have a look at the bar charts here. I think they convey the main message.
After 9% growth in 2018, LNG market growth accelerated in 2019 to 13%, which is above the 10% CAGR since 2015. That growth acceleration is due, of course, to the low LNG prices and also as a broader backdrop to local climate policies that are in favor to gas. So LNG is definitely confirming its role in creating more integrated liquid worldwide LNG and gas markets. A lot has been said about China LNG demand. So what are the facts for last year?
You probably noted that China overtook Japan as the number one LNG importer worldwide in November December 2019. Below the bar charts, we also show the estimated Chinese LNG import growth for the full year of 2019. The growth is slowing down from the skyrocketing pace of the last 3 years of 2016, 2017 2018, which is perfectly normal. But growth increase is still very strong considering the size of the imports that are now above 60,000,000 tons. So all in all, last year, there was double digit growth for China LNG imports at around 13%.
Europe was another key LNG market, of course, and I'll come to that in just a second. For 2020, supply will continue to be plenty true, and the year is starting with continued softness in prices. So that's likely to continue to be a positive for demand. Even if the markets are focused elsewhere right now, specifically on the virus outbreak, I'd also add that the partial U. S.-China trade deal is positive for U.
S. Energy exports, amongst which, of course, LNG. A last chart on the European power markets. What you see here with the bar chart is the actual power generated in terawatt hours in Europe from sun and wind and gas turbines. We've shown it since 2016 with estimated data for 2019.
What's really remarkable is that the amount of electricity generated last year from gas grew more or less at the same pace as the amount of electricity generated from solar and wind. And that's remarkable simply because the installed power capacity is expanded for renewables, but was flat for gas plants. So in other words, the gas farms and the gas power plant load factors went up significantly in 2019 in Europe. And this is, of course, explained by the cheaper LNG, resulting from the huge pickup in LNG imports into Europe. They were up by more than 85 percent, owing to the amount of available regas capacity in Europe.
Rising CO2 prices also contributed to creating a market arbitrage in favor of gas in several European countries, such as Spain, Italy or Germany. So in summary, 2019 saw really tremendous gas demand creation related to power generation in Europe and triggered a clear upside for those market players that are integrated on the gas power plant value chain, which Philippe will comment a little later. For 2020, the gas power plant outlook remains positive. With more countries accelerating the switch away from coal, Spain is continuing on the trend from last year and the Netherlands are joining in. And then, of course, the increased penetration of renewables will continue to require reliable base yield capacity in Europe at a time when the French nuclear production has been somewhat shaky and at a time when Germany is continuing its planned decommissioning of nuclear reactors.
That's all I wanted to say is the global framing. And now, Jean Pierre, I hand over to you. Thank you.
As shown by Helle, our industry is faced with volatility in commodity prices and margin. And the consequence is very clear, we have to keep the discipline and as Total, I think we are relentless in our efforts to cut costs, to reduce the breakeven and to hydrate our portfolio. And clearly, this is with constant pressure to execute and deliver that is reflected in our track record of superior performance compared to our peers. Despite the weaker environment in 2019 compared to 2018, so of course I will come back later, today we announced very strong results and growing cash flow. And once again, I think with these figures, we've demonstrated our ability to consistently deliver at the highest level among our peers.
So let's move to one of the key metrics, cash flow. So you know the environment was weaker in 2019 compared to 2018. Oil and gas prices on average were down by about 20% and gas prices over the same period were down by about 10%. Despite this less favorable environment, we increased cash flow by about 2,000,000,000 dollars so that means 8 percent to more than $26,000,000,000 And another very interesting or very remarkable element is that all segments performed well in this cash flow generation. For 2019, Total is best in class as the only IOC able to increase its cash flow.
For upstream, high quality volume growth more than offset these weaker commodity prices. E and P is the largest contributor, up 1% for the year to $18,000,000,000 But IVLP is the fastest growing segment with an impressive 8% growth to $3,700,000,000 And of course, it's the reflection of the 60% increase in L and E sales last year. Downstream continues to deliver strong cash flow from its diversified portfolio. And despite the 10% decrease in refinery margin and petrochemical margins, the result was stable or the cash flow, sorry, was stable at 6.6 €1,000,000,000 for the year. Cash flow allocation was delivered in line with guidance.
We invested DKK17,400,000,000 taking into account DKK4,100,000,000 of net M and A, net acquisition. Of course, we closed the Mozambique LNG deal in September and depart this net $4,100,000,000 net acquisition. And as you see, we returned $9,200,000,000 in 2019 to our shareholders, 7.5 through dividends and 1.75 through buybacks. As you know, we consider that controlling the breakeven is at the heart of our sustainability And in 'nineteen, in the past year, we continue to reduce the breakeven and we drove the organic breakeven and breakeven below $25 per dollar So let's move to the results. So Total is continuing to deliver strong results across all segments.
The decrease in adjusted net income was limited to 13%, demonstrating the resilience of our portfolio in a weaker environment. Adjusted net income was €11,800,000,000 for the year and return on equity remained above 10% at 10.4%, that means the highest among our peers. In the upstream, E and P generated EUR 7,500,000,000 down 12% compared to 2018. This reflects of course the 10% drop in brands and the 40% fall in gas prices. And this drop was partially offset by production growth and of course the efforts were done on August.
IGRP was stable year over year, thanks to the strong increase I mentioned already in our L and D sales around 60%. Our downstream sector resisted well, reflecting the advantage of our diversified low breakeven asset base. It generated $4,700,000,000 of adjusted net income, that means a decrease of 7% compared to 2018. Air Sea, Refining and Chemicals, net operating results was at 3 point 0 $1,000,000,000 in line with the lower margin. And marketing and services once again continue to contribute significantly to the downstream net operating income at €1,700,000,000 So as mentioned in my introduction, we are keeping constant pressure on OpEx.
You see here the significant progress we have made on cost reduction front throughout the group. Compared to the 2014 basis, the cost savings in 2019 was $4,700,000,000 and we target more than $5,000,000,000 in 2020. And now we are setting a new target for 2023 to reduce cost by an additional $1,000,000,000 This is a company wide effort. All the segments contributed to this effort, even if the majority of the cost savings came and will continue to come from the upstream. As you know, we improved efficiency across the group, we have simplified our process and our organization.
Leading the way is the total global procurement, which has achieved already more than $900,000,000 in savings and the main driver for this cost savings is of course the centralization of the purchase. So from an average of 15% of procurement centralized in 2015, We are now last year in 2019, we are above 30% and we target 40% in 2020. Digitalization and robotics, artificial intelligence will be of course the next wave of efficiency and will contribute to our costs and to structurally improve profitability. But of course, we are at the beginning of the journey and so we are in Aberdeen. And to this afternoon, you will see some digital realization made by our E and P subsidiaries.
So, I'll focus on Upstream performance in 2019. So Upstream delivered outstanding performance last year. Brands was down by 10%, NBP, so the European gas prices, decreased by close to 40%. So on average, I would say, prices were down by about 20%. And despite this environment, the cash flow increased by more than 9% compared to the previous year and this means that the 9% increase in volumes more than offsetting the weaker environment.
Upstream cash flow growth was driven by high cash margin production. So what we call the deep fall, so I mean the 2 AMG projects, 1 in Australia, 50, the second in Russia, Yamal, plus the 2 deep offshore projects we have in Nigeria and in Angola, so I mean, Edina and Karimbo projects. So these big four projects contributed around $4,000,000,000 of cash flow in 2019. In addition, of course, we benefited from 2018 value creating acquisition. Patrick mentioned that in his introduction.
So we acquisition the Nescol acquisition, the renewal of the Abu Dhabi Offshore Licenses and this acquisition are generating cash flow per barrel that are
above the portfolio
average. And of course, we benefited as well from the pressure on costs and execution of synergies that drove profit from 5.7 dollars per barrel in 2018 to $5.4 per barrel in 2019. As a result, the net effect was an increase in the 2019 Upstream cash margin, despite once again this downturn in the environment and Arnaud will come back on that in his presentation. So now the Downstream. The Downstream cash flow performance has been strong, consistent despite once again the challenging environment.
FCE margin fell by about 10% last year and were particularly weak during the last quarter. Still, the Downstream delivered $6,600,000,000 of cash flow, remarkably stable even the volatile in market. And Total once again generated the highest downstream ROACE among IOCs. We have a diversified portfolio of low breakeven, high quality assets. Refining, chemicals and marketing are well balanced within the portfolio, providing cash flow from different products and markets.
Marketing and specialty chemicals are not linked to the oil cycle and of course this adds stability to the cash flow. Bernard and Alexis are here to expand the distributor later and so they will comment in particular of the monomer polymer integration that we have developed on our integrated platform and Alexis will come back on the assumption of marketing and services in the fast growing new markets. Maintaining a strong balance sheet is a priority for the group. This provides us with a solid foundation allowing us to weather cyclical lows and of course with the financial flexibility to see the opportunities and we have done that very successfully very recently in Africa with the Northern Mid Energy deal in Anadarko or 3 years ago in the North Sea with the MercOil acquisition. Our objective is to maintain gearing below 20%.
We show here a total gearing on the left, including the impact of the leases. And so taken into account the impact of the deliveries, the gearing end of 2019 was at 20.7%. With the implementation of the IFRS 16, as you know, the rules are not the same between European and US companies regarding the treatment of the disease in the accounts. So we presented at the right in the middle of the slide, I would say, a benchmark against our peers, excluding the impact of the disease. And we are very transparent that for Total, the impact of the disease is 4% gearing.
That means that excluding the disease, the gearing is below 17%. A few comments regarding impairments. In 2019, we recorded $500,000,000 of impairments. For our calculation, we use a long term price trajectory that is in line with IEA NDA scenario, so I would say the 2 degree scenario, and that converts towards $50 a barrel by 2,050. This relatively limited amount of impairments as compared to peers reflects the resilience of our portfolio.
I noticed that most of the impairment done by our peers are clearly in line or linked to the exposure to US non commercial assets and as you know our exposure to this kind of asset is very low at total. So for me the variation of our strategy to play on our strengths and to try to act competitively. So the summary of the execution in 2019. We reported a strong set of results, once again delivering on the targets we set for the year. CapEx were in line.
We are on track with the assets. So we recorded $1,900,000,000 of assets sales last year and we announced an additional €1,000,000,000 So we are on track to deliver the €5,000,000,000 target over the 2019 2020 period. First release end target was achieved at 4,700,000,000 and we outperformed on total. Arnaud will comment that later on. Upstream production growth and downstream cash flow were in line and we are ahead of schedule on share buyback.
I remind you that we bought back the equivalent of €1,500,000,000 in 20 18 and this year it was €1,775,000,000 So if you add up the 2 years, you have the 3,250,000,000 of buyback. We achieved our targets because we maintain the discipline. On 1st, we maintain the discipline on capital allocation. And of course, we added major new startups and value accretive acquisitions to an already robust portfolio. We are predictable and more than that, we are reliable.
That's the illustration you can see on the right hand side of the slide. Adjusting from volume growth and using the sensitivities we provide to you, our results have been at or above the expected level. And finally, let's have a look at our performance relative to our peers and I am pleased to show once again that we outperformed our peers across several key metrics. Total was the most resilient in terms of net income. Total is the only major that increased operating cash flow in the significantly weaker environment in 2019.
This reflects once again the advantage of our lower rates of our success in migrating the portfolio with high quality production growth. Group ROACE is debt in cash, around 10% and return on equity at 10.4% is the highest amount of year. The conclusion for me is very clear. 2019 expands our solid track record of consistent delivery and performance in executing and delivering our strategy. And I leave the floor to Arnaud.
So let's start with a reminder that total Sprint strategy is to build on our strength and to focus on value rather than volume. In order to implement the strategy, first, we must take the most value out of existing assets. We do this by delivering operational excellence and of course, this starts with safety, which is the core value of Total and as was mentioned by Patrick, the cornerstone of operational excellence. We are also actively reducing scope 1 and 2 greenhouse gas emissions on our operating perimeter with the objective to reduce by 15% by 2025 compared to 2015. This objective is ambitious as it is expressed in absolute terms whilst we are growing the company and our team production.
Finally, we maintain a strong focus on availability of our wells and facilities and on cost discipline to leverage our low cost competitive advantage. For new projects, we focus primarily on our core areas, Africa, Middle East and North Sea, and building up on our technical expertise in deepwater and LNG. 2019 was a good example of this strategy in action. In Africa, with the acquisition of Mozambique LNG, in Angola with the extension of Block 17, In the North Sea with the Carlin and Johan Zarrow start up. In deepwater with Aegina and Carabos as start up.
With the FID of Neurutu in Brazil in deepwater and also in LNG with the FID of Arctic LNG 2 and Mozambique LNG. Finally, for exploration and acquisition of new resources, we focus on policy betings and manage our portfolio of assets proactively to lower the breakeven and rationalize our geographical footprint. In 2019, we have continued to deliver a strong production growth with 9% increase compared to 2018. This growth was essentially due to new startups in 2019 such as Carbo, Kirin and Johan Sverdrup and ramp up to plateau of our new field started in 2018, like Aegina, ICTI, sorry, Yamal LNG. As was already mentioned, in 2019, our LNG production has increased by more than 40%, and we are benefiting also from low declines, thanks to a significant share of new fields in our portfolio and low plateau production from LNG projects or in the Middle East oil fields in Abu Dhabi and Qatar.
In 2020, our production will grow by 2% to 4% with new fields started by the end of last year, like Temparosa or Iara P68 FPSO developing Derbigao and Soluru field in Brazil, but also new startup again in Brazil with the second FPSO on the Iara block developing at APU. Overall, we are on target to deliver 5% production growth between 2018 and 2021. Together with production, E and P cash flows, this is E and P new perimeter, has grown substantially since 2016. This year's growth is about 1%, which is a solid performance in a lower price environment. It was due to the contribution of a high cash margin asset startups such as Aegina and Kaombo.
As shown on the right part of the slide, the cash margins of new projects started in 2018 2019 are above $30 per BOE in a $60 per barrel environment. One of our competitive advantage year after year has been our consistent discipline on OpEx with $5.4 per BOE achieved in 2019, decreasing from $5.7 per BOE in 2018. And we should maintain this performance in 2020, thanks to approximately $250,000,000 per year of synergies from Maersk Oil. This is a new target and which has been revised up from more than $30,000,000 last year to $350,000,000 this year, but also by leveraging on our global purchasing opportunity, which has delivered significant savings ahead of plan as presented by Jean Pierre. This afternoon, we will give you some examples and more details about these synergies here in the UK.
And as a reminder, we are targeting $5 per BOE in the next 2, 3 years. On reserve replacement, our traffic order is very strong and has been consistently better than our peers with 124% for the 5 year average and 157% in 2019 with large gas projects launched such as Mozambique LNG or Arctic LNG 2. This reserve replacement rate level is a solid performance given the fact that we have grown our production by 8% in 2018 and 9% in 2019. As you can see from the right part of the slide, we have approximately 20 years of proved and probable reserves and with around 60% of gas. Now to illustrate our capacity to capture promising exploration acreage, I have taken 2 recent examples with our entry in Block 58 in Suriname just before the Makahwan light oil and gas condensate discovery, which is on trend to the prolific Exxon operated Star Bulk Golden Block in Vienna with 8 1,000,000,000 barrels of oil discovered.
Makar-one has found 123 meters of net pay and there are 3 additional prospects to drill in that Block 58, one being drilled as we speak. The acquisition cost in case of development will be around $2 per barrel, mainly the carry of Apache during the development phase, quickly reimbursed on their cost oil after started. And we will operate this block. We are also a partner in 2 of 3 day promising prospects to be drilled in Guyana this year. My second example is in Brazil, another key area for the group with assets in production and development and where we have been successful in the E and P 16 last bidding round in October 2019 and captured 1 of the largest remaining block with 2 world class prospects due to be drilled by the end of 2020, early 2021 in the prolific Compose presold oil vesting and Total will operate this block as well.
Finally, this slide provides a list of main projects already sanctioned in 2018 2019 or to be sanctioned in the next 2 years. All these projects are profitable with an internal rate of return greater than 15% at $50 per BOE and we represent a cumulative production of more than 800,000 barrels per day by 2023. Once again, we demonstrate that we deliver. By end 2019, we already launched half of these projects, including Arctic LNG 2, Mozambique LNG and Meru 2. All these projects are benefiting from attractive market conditions following the downturn as well as simplified design and ways of working.
The geographical spread gives a good measure of the quality and resilience of our pipeline of projects that will fuel our profitable growth in the coming years. Consistent with our strategy, the majority of these projects are LNG or in water. To recap, I hope that these few slides have given you good visibility on the profitability of the upstream segment. And I'll now hand over to my colleague Bernard who will speak about Refining and Chemicals.
Good morning. Let's now move to Refining and Chemicals. So you certainly remember that Refining Chemicals strategy has been the long three pillars. The first one is, of course, long integration, which is really the backbone of the refining and chemical branch. So it means that we want to focus most of our allocation and development on our 6 large integrated platforms worldwide with a target of having more than 70% of our capital deployed on this platform by 2025.
And of course, we keep working, as it was said earlier, on the operational excellence what we control, not only all the cost along the energy efficiency. The second pillar is to grow and to grow in petrochemicals, not in refining. We want to grow in petrochemicals because there is this is a growing market and we want to catch this growth. The Petrochemical, we target our produce from gas as you know because gas is a low cost feedstocks. And we also want to be balanced in our capacity of liquid monomers and polymers by being integrated and we will come back on this one.
And the 3rd pillar is, of course, to invest in low carbon solutions. By that, I mean all the bio based solutions, biofuels, bio polymers. And we also want to be proactive in the field of test recycling with the recovery condition to have 30% of recycled polymer by 2,030. All of this will translate into an additional CFFO of $1,500,000,000 by 2025 and of course, a return on capital employed above 20%. So now let's move on to 2019 achievements.
You see on the right hand side that we have been able to deliver $4,000,000,000 of CFFO despite a weaker environment that is what said in Refining and Petrochemicals. And you see also that we have been able to maintain return capital employed above 25%, which is the best in class. So what I would like to show you is how we did it by looking at the 3 pillars of the strategy, how each of these pillars contributed to these results. If you look on the left hand side, you have Ambev, which is one of our larger integrated platform. And I think it's a good example of how we have played the integration between refining and chemicals.
We completed in 2017 a very large investment program, dollars 1,300,000,000 to upgrade the platform, to reduce the production of high sulfur fuel oil, increase the production of low sulfur distillate and also being able to increase the flexibility of our crackers to allow them to crack more low cost feedstock such as ethane or refinery of grade, which used to be burned as a sugar. And you see that this has proven to be very, I would say, contributing because this complex generated less just $750,000,000 of cash flow from operations with a very good utilization rate. And I also would like to mention that we launched last year a consortium with 5 other players from the Hamburg Harbor to develop a carbon capture and storage project, which will contribute, of course, to consolidate the platform for the future. So integrated platform of course is a strong contributor, but not only Petrochemicals also plays its part in the cash flow generation.
You see that we want
to grow and as we come back on the 4 projects on the left hand side, but what I would like to start with are the 2 charts on the right, which really demonstrates how we stick to the 2 principles I've just mentioned in the strategy. 1st, which is to take advantage of the lower feedstocks and you see that in 2019, we have been able to leverage or to benefit from the low cost feedstock because today the feed slate is close to 60%. So we will grab the benefit of this low cost feedstocks. And you see also on the monomer and polymer integration that we have a very balanced profile. With close to 6,000,000 tons of monomer and pretty well balanced with 6,000,000 tons of polymers.
And by 3, this integration, we are able to capture the margin all along the value chain regardless of the cycles. So in 2019, we have moved forward on the 4 large projects, which you know, which hold by the risk to these 2 principles. The first milestone we achieved in 2019 has been in Korea with the expansion of crackers. We are now able to crack 40% more. And that's all U.
S. Propane, so cheap propane imported from the U. S, which we crack now in Beisai in Korea. And of course, in this project, we also have downwards indebted relatives, PEI, we are just in the phase of starting at now and the PPN, which will start up in 2021. The next milestone will be 2021 in the U.
S. With the start up of our large project in Parfel, where we have received we are making good progress, cracker and also polymers. And we're also making good progress on the last two projects, which are now in the FEED phase in Jubei with our partner Aramco and in Algeria with our partner Sonatrac. 3rd pillar is the low carbon solutions. You see that we indicate 10% of our CapEx to this field.
So we want to invest in 3 areas.
As I said, the bio based solutions, plastic recycling and the CO2 emission reduction. You have there just a few examples, the start up of Lammed, our first biorefinery last year in August, The startup of our 1st bioplastic plant in Thailand, producing biopolymers made out of sugarcane. We have been very active in the field of plastic recycling through acquisition with a company producing recycled propylene for the car industry, but also through partnership with large brand owners like Marf and Nestle to develop chemical recycling. And we have been also active in the field of the CFP emission reduction, of course, through our energy efficiency program in our operations, but also by developing green H2 projects, 1 in Nam Ed in France and 1 in Germany in Good morning, everyone. Thank you, Dana.
To begin with, I would like to give you a quick reminder of the 3 pillars of the marketing and services strategy. The first one is that we are growing our retail markets, our retail network in large growing markets such as China, India, Mexico, Brazil, Saudi Arabia and to a lesser extent Angola. We anticipate the oil demand to remain strong in these markets, which represent actually 25 percent of the world demand. We aim to have more than 4,000 stations there in 2025, which will then represent 20% of our stations worldwide. Secondly, we are building on our existing retail networks to develop non fuel sales to increase value.
In Europe, we continue increasing our non fuel revenues in shops and food and we are expanding our offers of services in cars, fleet management and mobility. This nonfood part of our business is due to represent 40% of our cash flow from operations in retail in Europe by 2025. In Africa, we are the leader in shoe retail and this is important, we actually have the biggest retail networks in the continent whatever the business. So we plan to further grow targeting a market share of 18% and leverage on the size of our retail assets to develop non share revenues to a growing African middle class. Thirdly, marketing and services has its role to play in the strategy of the Group to grow in low carbon businesses by providing state of the art solutions to our clients with mobility in these alternative fuels, namely serving the growing EV charging business.
Our target is to have 150,000 charge points operated in Europe by 2025. And in addition, we are taking the advantage of the development of natural gas in road transportation by building an extensive network of MGD stations in Europe with a target of 500 stations by 2025. And the USA, we already have a good position with our 25% share in Clean Energy, the US leader with 5 hundred service stations there. We're also preempting the breakthrough in marine transportation that LNG is making by expanding our customer portfolio and building strong position in the supply chain in the key hubs on the maritime routes between Europe and Asia. Lastly, we are looking at hydrogens.
We have been an early supporter of that gas, especially in Germany and in France enabling us to closely monitor this energy solution. This threefold strategy of capturing growth in dynamic geographies, developing non fuel retail and proactively building a stronger in low carbon mobility we contribute to keep on delivering added value for the group. In the coming years, we are committing to delivering an additional €100,000,000 cash flow from operation every year until 2025. So now, I would like to take you through what we have achieved in these three areas in 2019 and what is unfolding in 2020 and beyond. First of all, and let me take you to the right side of the slide.
Marketing and Services exceeded its target of cash flow from operations in 2019, generating $2,500,000,000 of cash flows, therefore more than delivering on our objective of plus EUR 100,000,000 year on average with a strong contribution from retail, but also from our high value lubricants and specialties. In addition to Europe and Africa where our retail operation was strong, the first pillar of our strategy is to expand in the large fast growing markets I have mentioned earlier. We have now started operations in Brazil with 300 stations operating after the acquisition of the ZEMA Group. Brazil is not only a large market for retail, but also the 2nd largest biofuel market. So growing our market share there, we contribute to lowering the carbon intensity of our global sales.
In Mexico, we are pursuing our development strategy and have now more than 200 total branded stations operating. And in Saudi Arabia, the JV we have set up with Saudi Aramco has completed the acquisition of a retail network of 300 stations and you will see the 1st total and Aramco branded station in the second half of the year. When you add up all those figures, you can see that we already have 1,000 stations in this market at the end of 2019. Operations have actually started in Angola last month and we will start in India later in 2020. Are clearly therefore in line with our target of 4,000 total solitization in these key markets by 2025.
The second pillar is to increase nonfuel revenue. Fuel demand obviously will not evolve in the same way in all markets and we see our retail stations as a platform for services and we intend to leverage them to expand sales on loan to products, which are independent of oil cycles. This is particularly true for Europe. In 2019, you see on the right that we grew our retail cash flow from operations by more than $50,000,000 in Europe and the non fuel share grew faster and was in excess of 1 third in total, therefore in line with the objective of reaching 40% in 5 years. To keep that momentum in the competitive and dynamic retail environment from 2020, the customer experience in our Santal Boursneau shops will be enhanced with the rollout of our new shop concept, the mobility concept, you see actually a picture in front of you, that will boost the value we capture from our clients.
But our retail operation also benefits from strong and growing revenues coming from fleet management and mobility services. We are innovating in new technologies to extend fleet management services worldwide. For example, in 2020, Total will be qualified to collect toll fees in Germany. This accreditation is part of the development of our toll solution in Europe for heavy goods vehicle, which will eventually enable trucks across Europe with the same onboard units that we market. Those B2B needs of Fleet Management are also fast growing in other markets and we acquired a full online fleet card solution in 2019 to support our expansion apps for Europe, in particular in Africa.
Our strategy is to internalize this core business in order to create value around mobility as we are doing it in Europe. Another part of our non core strategy is to accelerate the development of total wash sales. We actually currently have more than 2,000 car wash facilities in Europe. They are actually mostly in our retail stations and this is a very good margin business. To further create value, as our Total Watch brand is very well known, we decided to go beyond our retail assets and announced our premium standalone wash offer in 2019.
Its 1st total wash center without fuel distribution located in France is autonomous in electricity, baysolarization and hot water recycling. In addition, we are also moving in car parts, developing our premium hand wash also there. With these examples and realization, you can see how we are leveraging our existing sites to expand and diversify our sources of cash flow. And the 3rd pillar, growing in low carbon solutions. Definitely, energy transition is happening though at varying phases around the world and Total is already active in many alternative sectors.
To illustrate that we are a real player in that transition, we are allocating 10% of marketing and services CapEx to low carbon businesses or solutions, and they are mainly around 3 businesses. The first one is marine fuels. As part of total strategy along the integrated gas value chain and to capture opportunities opened by the new international maritime organization, we are developing clean Marine Fuels. We recently announced the signing of a second major agreement for LNG supply of new container ships for CMA CGM to be located in the Mediterranean. Along with other existing agreements, our portfolio now represents in excess of 6,000,000 tonnes per year.
Additionally, in a method to promote the use of LNG fuel in shipping, the group is making is ramping up its logistical facilities in the major supply hubs, therefore building a global network of bunker LNG Logistics. That is our first LNG supply ship will be operating in Rotterdam later in Q2. And earlier last year, we announced contracts for certain LNG bunker vessels to be delivered in 2021 to be positioned in Singapore, the third one to be located the same year in Marthari and we are working on putting 1 in the Gulf as well. So I'm happy to report that with all that put in place, we will start our first LNG bunker deliveries in 2020. We are on second part is we are developing top tier position in electromobility by leveraging on three things, our strong footprint in retail network obviously, but also in car dealerships and that is possible thanks to our lubricant business and through our fleet car customers who are requesting multi energy solutions.
The number of charging points we are operating grew by 40% in 2019 to 16,000 and we aim to carry on growing at the same rate at the same pace this year to reach 22,000 in 2020. You must have read recently that we were awarded the largest European concession contract for EV charging points. We will install and operate up to 20,000 charging points in the area in the metropolitan region of Amsterdam. We are therefore moving nicely towards our ambition to operate 160,000 point charging points in Europe by 2025 and to become a major player in electric mobility business. To complete that electric part of the business, in addition, we in 2019, we started our first supercharging points in service stations and we will roll out 60 stations equipped with those superfast charging points that means more than 150 kilowatts by the end of 2020 in Europe.
She is part of the future phase of our service station and confirmed our ambition to offer supercharging solutions obviously in urban centers, but also every 150 kilometers in Western Europe. We also see business opportunity in developing natural gas for road transportation. This is clearly the case in Europe where we have now a network of more than 200 NGV stations, NGV being compressed natural gas and also LNG on track with the target of 500 in 2025. As part of the strategy in 2019, we expanded our partnership in India with the Adani Group to contribute to the development of the Indian natural gas market. We should open the first of 100 and EC and D station later in the year, which is the first step to having more than 1500 in 10 years.
I would like to mention that we are looking at increasing the biogas penetration in our natural gas sales. As an example, today, more than 1 third of the gas delivered by clean energy in the U. S. Is biogas and we are putting plans to develop that in other markets too. And last, I would like to mention that in Hydrogen, Total has been an early supporter of Hydrogen in Germany being part of the H2 Mobility joint venture and today more than 25% of the hydrogen public station in Germany on the total network.
We also have some public station in the Netherlands, in Belgium, whereas in France, we are looking more at captive fleets and for with private customers. As a conclusion, I have shown you that we are delivering on all the 3 pillars of our strategy and that marketing and services is positioning itself well for the future, while being a significant and sustainable source of cash flows for the group. I thank you for your attention and I give the floor to Philippe for the last part of the presentation.
Thank you, Alexis.
Let's turn now to IGRP. IGRP being as you are aware the segment where we are chasing actively all the opportunities arising from what we call the innovation transition. It's not your own sector and Alexia showed in particular what Enel was also in thought going after in terms of new business opportunity as well. But in IGRP, we focus on those growth opportunities, mainly in the 3 areas that you do, global LNG being based on the gas growth that we see rising from the unsustainable scenario that are developed more and more across the world. Opposite is rising from electricity, especially in Europe, where in fact we know the market and we have the opportunity to go downstream the gas electricity, the value chain all the way to end user customers.
And last but not least, the renewables, the renewables being worldwide, the highest growth energy market that we are also pursuing. And of course, the history of IGRP is not only for growth, for growth of volume of energy. This is for the history of growing the cash flows. And I remind you about the ambition, the target that we have acquired, it's called to be fixed growing the cash flow from operations by $3,500,000,000 over the next 6 years. We are investing significant amount of money, dollars 1,500,000,000 to in the low electricity low carbon electricity business.
So turning to cash and to results, we can say that 2019 was a good achievement in terms of our targets in environment that was clearly not really favorable, especially in terms of gas pricing environment. We managed to increase significantly the cash flow by some 75% from 2.1 $1,000,000,000 up to 3.7 percent. And this was the result of the long term stable cash flow that we have in upstream LNG where we are benefiting of long term long capital and all projects that Qatar and Nigeria are delivering year after year their share of its cash flow. And of course, we add the new projects like Ichthys and Yamal, which started last year and contributed, of course, ability to this growth. Sector is becoming more and more important in the group and now with 15% of the group cash flow that is generated in this sector around slightly below 10% last year.
And if the growth came from mainly from LNG, we had also positive contribution of low carbon electricity. Next year, we anticipate again growth in
it can be in the call in
terms of price and environment. We aim at generating roughly 5% more accounting for the fact that we don't have any significant new startups in the LNG upstream apart from Cameron. Cameron, we started the production of Train 1 in 20 19. We started the 2nd train early January and we are targeting to launch to start up the 3rd trend, mid of each, but we thought from Camelo, no significant start. Integrated LNG, so as I said, this is generating most of the increase of the cash flow.
This is coming clearly from the growth of the volumes, volume that we produce, volume that we are selling and you see what we call our LNG portfolio growth on this chart where we increased our volume by 60% between 2018 2019. We anticipate to continue also this growth in 20 20. And the growth will come from the supply from our JVs where we have equity, which are in fact continuing to grow to the plateau. But it will come mainly from the growth of our U. S.
Portfolio. We are becoming the largest 25% of selling, which started and 5 or 7, which started last year, but will be 100% running in 2020. And also Freeport with the contractor that we bought from Toshiba because as you are aware, we received $800,000,000 last year to accept or to take this contract. In terms of cash, as you see, plus 70%, plus 1.5 $1,000,000,000 so an impressive growth. And we have to notice this very strong contribution of Yamal.
Yamal, I know that most of you have visited the site, which is impressive in terms of physical operations, it's also very impressive in terms of cash flow generation and it's contributing nicely to this growth. Russia overall, if you add the contribution of Novatek, it's contributing now nicely to the overall cash flow of the group close to €1,500,000,000 is generating from Russia. Long term, once again, our strategy in ENGIE is not about growth for growth, but growth for profit. And this growth profit is really based on very simple parameters. The first one is that we want to build a portfolio of the most competitive sources of supply, which is why you have seen us very active in the main rich gas producing countries such as Middle East, Russia, Australia, U.
S. And more recently, Africa, of course, with our acquisition of Mozambique LNG. And we want also to point out also on the main LNG market, so Japan, Korea, Taiwan. And of course, the big giants, such as China and India, where we anticipate dramatic growth that will continue over the next year due to the need for them to go from coal to gas. And this, of course, when you consider the size of the population, the size of the need of both of those countries, which are more continent than countries, will drive a dramatic growth in the gas market and in the LNG.
So we think that we are well positioned to benefit from this growth. We consider that this growth will remain profitable, of course, there is a question of supply demand balance. And we have seen maybe too much FYDs taken in 2019. We couldn't see it, but it's up to
you to have judgment on
that, that the low price environment could discourage number of projects. That is clearly our hope and we on our side, we are not ready to take FIDs on projects that we think we will not believe in the appropriate economy of scale and cost structure. But of course, it's a competitive market and we are used to have volatility in those kind of environment. In terms of gas market, we don't want to forget about Europe. And when we bought a portfolio of ENGIE, this came with a very significant share of the legal certification capacity in Europe And you could question the interest of the gas capacity for market, which is not, of course, anticipated to be the highest growth gas market as the world.
But we've seen the interest of the European market at time when the markets in Asia can be low tide. We know that we have Europe as a safety net and a lot of cargoes came to LNG Cargo came to Europe last year and we could take advantage of our excess capacity. Having built this global portfolio, so we benefit clearly on economies of scale, but we also benefit of optimization of opportunities and coping with volatility of the demand and coping also with the opportunities avoiding unnecessary shipping costs. And as we have already commented, we are generating nice profit from this optimization. Turning now to the integrated electricity electricity value chain in Europe.
So we have both 3 segments ahead of you where we are growing. Facilities, of course, and Patrick commented that we are very happy to see the growth of the dispatch of both the CGT that we bought over the last years. We had the opportunity to both at discounted price, both on CGT at a time when the CO2 price was too low to push for the coal to get switched in Europe. But now we are seeing with the combination of this deal to price growing all the way to EUR 26 per tonne and we cannot see that it's not over. We have seen this call to gas, which very strongly calling therefore high dispatch of CCGT and in terms of cash, CCGT is generating the decent and interesting cash, especially when we consider the low prices of acquisition.
In renewables, so growth story worldwide, the growth story also in Europe and nearly doubled the portfolio of generating assets in 2019 and getting the growth mainly from organic growth, which is delivering to us significant profit. And in marketing, we continue our digital model, which allows us to disrupt the historical monopoly, the historical incumbents and especially in France and Belgium, where we have decent market share already. And we managed to grow our Power to Power customers portfolio by 500,000 last year. So the growth is still there and we are also generating profit. Overall, all 3 segments delivered roughly $200,000,000 of cash flow from operation in 2019.
We use both worldwide to complete my presentation. It's clearly the area where we see the higher growth among all the energy market. We have to be careful about the disciplined strategy in order to generate profitable growth strategy, which is of course that we are aiming at. And now we can say that we are we have now very efficient, very well trained teams that we acquired, that we trained with Total Quadrant, Total Iran and now Total Solar starting to contribute. We try to focus on organic growth in order to generate, once again, the maximum value, acquiring also pipeline as early stage as possible.
We cannot limit ourselves to early stage, this is the intent. And this is giving us the opportunity to generate more value by derisking the projects, which means securing land, securing the permits, negotiating PPA negotiating, EPC negotiating and non recourse financing and with payroll commission, all subjects that are familiar in the company, such as hotels. And once we have developed the project, the risk we use what we call the farm down to sell part of the equity in order to ensure that we have a double digit return on those investment. And we had several examples of this implementation into the 'nineteen of this model, which was acquired in Europe. Qatar is also a new example of a large success that we announced earlier in Jan with 800 gigawatts of projects that will be a landmark for the group in Qatar, double landmark in this country that we like a lot and when we generate the other profit, you will have the team that we have also announced a 2.1 gigawatt deal with Alani.
And you know we have been partnering with Alani in gas in Adani, which is a very dynamic, Avadelani, which is a very dynamic group and allowing us to benefit from the opportunities of this once again country continent, which is India and be prepared to hear from acquisition and so for additional portfolio. We think that we can secure a nice acquisition and generate value. We don't forget about storage. As you are aware, intermittent renewables are growing a lot, but the more they are growing in the energy needs, the more we have to cope with the intermittency and storage for stationary use is going to grow. What we intend, of course, is to make this opportunity a profitable opportunity.
And we learn from, I would say, the mistake of the experience of the past, the solar panels and solar cells and for battery, for what we call it, ESS, we were adamant that we were willing to develop this activity only with a local base in China. And why China? Because the Chinese are very good at developing the mass collection at a very low cost. And we managed to partner with Ternang this year, which is bringing us brand new plants, very automated, 4 gigawatt hour of capacity, which is much more than what we had in SaaS so far. But we can combine the unique new of SAFT in terms of technology and with mass pollution basis that we love in China.
And that will allow us, of course, to solve the Chinese market, but also the international market. Later on, we had the opportunity and also you see the announcement to launch interesting, I would say, venture with PSA. And the idea is to take advantage of the willingness of Europe to develop very quickly EV manufacturing, EV sales in Europe, electric vehicles. And we have the opportunity to partner with PSA in order to develop a European production projects. It's clear that we wouldn't have done that if we wouldn't have strong partners and strong customers with PSA.
And we wouldn't have done that, we would not have had a very strong support of the authorities and strong support meaning not words, but real subsidies. And this is why we have decided to start this project. There will be, of course, a lot of further steps to validate in order to scale up the project up to its 30, 48 gigawatt hour equivalent of 1,000,000 vehicle at 10% of the European market. But we have started as a first phase for very limited amount of equity, I can tell you. And we continue to generate decent cash flow from $1,000,000 in 2019.
And what we can conclude is that we are in good shape in order to pursue the growth that we have started some 2, 3 years ago when we created a GRP and we're looking now as a sector inside our GRP generating growth, generating cash flow with the goal of being more and more visible in the Renewables segment as well, but on profitable basis and delivering the target that we have of 25 gigawatts, so equivalent of 25 nuclear plants more or less in 2025. And now I will let the floor to Patrick to conclude.
We have an extensive review of all the segments by my colleagues. And so now just to have a theme for the future. I will come back of course, I comment CO2, I come back with climate and the strategy that we deliver in the coming years. The objective being, of course, to demonstrate to you and to convince you that not only we can be strong on our results, but at the same time, we have to prepare the future and the future is partly linked to the evolution of our markets in the energy field. If you know this slide, there's no change and you know the conclusions that we grow from this slide.
We have to adapt our company to the evolution of the energy markets. We all in a 2 degree world and more and more society is claiming to go towards this world. The oil consumption could decline, which means that there is plenty of supply. So we should put pressure on prices at 2,040 horizons, which means that we focus oil projects with low breakeven. On the contrary, natural gas should find growth in this mix at the expense of coal.
So we continue to expand our position in the gas value chain, as it was explained by Philippe. Renewables is growing, it actually economies electrified. So this is why we want to be a profitable and sizable low carbon electricity business. And last but not least, if we want to be in a carbon neutral world, we'll have to invest in carbon neutral technologies and businesses, and I will come back on it. So we have set an ambition, which is summarizing this our strategy, which is summarizing this chart.
This is the result of the strategy among the 4 pillars I just described, which is to reduce the carbon intensity of our energy facilities so we use by our customers. Of course, this is not like Scope 1 and 2. Scope 1 and 2, we are in control. Scope 3, which is underlying this slide, we are not in control. This is a society, the demand.
We are not car manufacturers. We are not clean factory materials. We are not the cement industry. So we deliver energy. But this the demand will be influenced obviously by the evolution of each segment of the demand.
People do not consume oil because we produce oil. They consume oil because there are processes, there are vehicles, there are planes with ships, which are used in oil. So this, of course, that we can contribute to this evolution of the society demand. And of course, we have an ambition, which is to decrease the carbon intensity by 15% by 2,030 and beyond it, let's say, up to 40% by 2,040. Just to remark, the slope of this decrease is aligned on a 2 degree scenario.
Of course, the absolute number of carbon intensity of our oil and gas and power of company, of our energy company is higher than the average of society, but the slope of decrease is in line with the society expects. But it's not only worth because we want to talk. And in fact, in the last 4 years, since we implemented that strategy, we have already decreased by 6% this carbon intensity. It's a lot of efforts. It's a result of our strategy in natural gas, sales by 3, dollars 15,000,000,000 have been spent.
Electricity sales, of course, were very small in 2015. So multiply by 4, by 8. It's again more than €5,000,000,000 being invested in low carbon electricity. But this 6% is honestly among the major company by far the highest achievement. 2 of our companies are communicating about scope 3 in the earning and among the IOCs.
1 has set a target of 3% by 2020 and the other one is today at 100% by 2018, did not decrease yet. So we hold the talk, and I think it's important to stand the line in the context and the global debate that the society and the pressure is putting on all the energy fields. What is the way to move forward? And I think, again, it's not only about emissions. Even acting on emissions, it's fundamental.
It's back to scope 1 and 2. It's also acting on products and acting on demand. These are the key levers we want to put into action in order to reach our does it mean? That means that we should not speak about oil, gas. We should speak about liquids and gases.
We can decarbonize oil by blending oil with biofuels. There is no new activity, which will be developed to biogets for planes. In many countries is under scrutiny. And we have obviously a role to play to provide the new, I would say, liquids which will allow planes to continue to transport the passengers around the world with lower carbon products. We can also decarbonize natural gas by blending it with green gas, with hydrogen, with biomethane.
You can easily put into a natural gas European network around 10% of hydrogen. It's a way to, again, to contribute to the global ambition. So acting on products is a way to do it. Acting on demand, of course, is another action. We or we consider that we should try to substitute to all to low carbon products whenever it's possible.
For example, producing power with fuel oil is not the best way to use oil, to produce power. There are other ways, natural gas, renewable. So we envisage to stop selling fuel oil for power generation. It's a concrete it will be a concrete contribution to this society demand. And of course, on natural gas, we should promote gas use.
It was described by Alexis on LNG Bankering. When we invest in India in natural gas, it's a bet because, of course, their coal is our only natural resource and it's less expensive than natural gas, but it's also a way to help that country to transition and to get of course, we are looking for profit from the growing markets. And in petrochemicals, when we substitute ethane to naphtha, it's also a way to contribute to this lower carbon society that we are aiming for. Emissions are also very important. Acting ammunitions has been described by Arnaud for liquid for oil.
Emission is obviously a real is a key topic for when we speak about natural gas. It's not only among our own operations where we have again, we target less than 0.2% of ethane emissions. But it's a longer chain where we are to be stewed off because there are some leakage which could appear even in City Gas. So we have to steward this the full value chain in terms of promoting natural gas for controlling methane emissions. On the electrons, I would say on the power, investing in the electric mobility value chain is a clear axis for the company.
There are 2 good examples in the last month, these GB for battery, these charging stations for concession in the Netherlands, you will see us quite active. Investing in electric mobility value chain is also a way again to contribute to lower the carbon intensity of the energy we sell to our customers like developing storage solutions. We spoke about Philips, spoke about batteries, we spoke about hydrogen as well. The more we will be involved in renewables, the more the question mark about generating hydrogen from peak solar farms is a matter of being able to store energy. And I think it's another axis of development to create value from these investments in renewables in the future.
Carbon sinks is the 4th pillar of all these actions. It's not a matter of compensation at all. It's a matter of making investments. Betting on the fact that carbon pricing will come step by step in Europe, it is there, but around the world. And then these investments will become quite profitable.
We begin to I've lost I'm losing finger. We have begun to invest in natural based solutions, forest projects in Peru, in for Amazonia Forest. It's not only a matter of gathering of planting trees. It's a matter of investing in social investments in order the communities to avoid to deforest, I would say, and to give them some economic activity. So, that will become shareholder of a chocolate plant in order to make the full story and to have a sustainable solution for these carbon neutral carbon things.
It's also CCUS. We are in a country today, and I think this afternoon, you will have opportunity to ask questions, where there is quite a few years in the North Sea. I can't think that North Sea could become a sort of new area, a new business opportunity with CCUS. We are embarking a project in Norway with Equinor and Shell here in 2 projects. Again, we can come back on it.
And we have Bernard mentioned that we take the lead of a new CCUS project in the Anwerp industrial area, where many heavy industries are emitting CO2s, trying to combine that with some depleted fields, mature fields in the Dutch North Sea. So there is a lot of things to be invested there. Again, we allocate $100,000,000 per year. And last but not least, we have to promote innovation, and we put in place a carbon neutrality venture fund where we have booked it from $400,000,000 by 2023. Of course, all the strategy requires investments.
So we reiterate in front of you these guidelines, dollars 16,000,000,000, dollars 18,000,000 over the next over the 2019, 2023 period. So no change. We spent in 2019 $17,400,000 as explained by Jean Pierre, a little under the $18,000,000,000 we gave as a guideline after the Anadarko acquisition. We acquired, by the way, dollars 4,000,000,000 of around $2.4 per barrel. So it's and we've seen the positive impact on the renewal of reserves.
And for 2020, same guideline that we gave in Santander, 18,000,000,000 dollars of capital investments, including acquisitions, less disposals. On the disposal side, we set a program of $5,000,000,000 after the Anadarko acquisitions. We have already sold or announced around $3,000,000,000 So we are well underway. And there are these programs, you probably know that, for example, we put on sale Bonga in Nigeria, it's public. And we have other work projects on which we work in order to fill that program.
So it's a strong commitment from the company. In fact, we are targeting to sell more than that because we know that execution of sales is always sometimes could take time in our industry. Another remark on this slide slide is that when you look to the program of 2019, 2020, you can see that what we call low carbon CapEx contributing to LNG to low carbon electricity represent and but also the actions taken in Refining and Chemicals, about biofuels or in Marketing and Services, like it was described by Alexis, about charging points and batteries, etcetera, represent more than 30% of the investments of the company, globally speaking. So it's the strategy is really in action, And this is a condition, if again, we want to adapt the company to the evolution of the energy markets and contribute to lower And this is combining this ambition to a play to our strengths. And I think here today, we are in North Sea, so we'll have the opportunity this afternoon again to discuss about it.
But just a word about Africa. Africa represents $10,000,000,000 of cash flow from operations out of the $26,000,000,000 announced by Jean Pierre. So it's a big part of the company. We have made some strong move, of course, this year with starting up Kaombo and Aegina, but also accessing to more resources. Mozambique LNG was the jewel piece of the another crew, I would say, portfolio.
In agreement with Oxy, we already closed it in a record way, by the way. So now we are in command of this large project. It's not only a project for today. It's a large base of this year for many years. And I would say the LNG field, between our Arctic position in Russia, between Mozambique, between the U.
S. Projects, we have in our hands not only the next wave and growth for 2025, 2025, 2030, but beyond. And it's a matter now of being able to execute all these projects. But it's also we have also secured, we've seen end of the year, maybe to come back in Angola, which is a third country for our group. Block 17 extension, the Golden Block, you have 3,000,000,000 barrels.
You have 1 which have been produced, EUR 1,000,000,000 is still there in front of us. So it's a nice way to expand this license, this Golden license. But we have also signed an agreement in Sun Angle to develop 2 discoveries. It's around €350,000,000,000, 4 100,000,000, which can be of oil, which can be developed in Block 2021. So consolidating again on our strength in Angola and Depoitte is the best way to create more value.
You noticed that we finalized all the agreements on Libya with an OAR entry. And exploration, of course, in Africa with a discovery in South Africa, which will be upgraded this year from keywords to come. But it's also Africa for us the frequency where we put into action our strategy in natural gas and demand and renewables. We have teams that have been able to have access to a new regas terminal in Benin, in regard to hydrolytors. We also have announced that we are working on Maputo LNG in Mozambique because it's a large country in Mozambique from north to south.
And bringing gas to customers in Maputo but also potentially exporting natural gas through pipeline to South Africa could become also a profitable way to add value from this acquisition in Maisonbee. And Renewables, we begin to develop in South Africa, in Kenya, in Egypt some projects. Last but not least, of course, as it was reminded by Alexis, we have all present in 40 more than 40 countries for our networks, which also drive around a little less than $1,000,000,000 of cash flow every year, and growing ones. So this is, I think, a perfect demonstration of our strategy, which is to play to our strengths and to continue to build, to develop, to create value for our shareholders. So that's the result of all these strategies.
So again, this year, pleased with the EUR 26,000,000 to EUR 20.1 billion to increase to EUR 28.5 billion of debt adjusted cash flow. I'll remind that EUR1 billion is coming just from the IFRS 16, so forget this one, but the rest is your cash, which will allow us to increase the return to our shareholders. And at $60 we confirm for 2020 that we have another €1,000,000,000 and for the years to come in a quite a progressive way. It's coming again from the start ups, the big 4, which have generated more than 3.5 $1,000,000,000 or Egina, Equis, Caombo, Yamal, but also from the downstream and with the sensitivity for next year of $3,300,000,000 or $10 per barrel of liquid realized price, so it's we have $3,200,000,000 $3,300,000 The increase is just because we produce a little more. And for the gas, the sensitivity around 3.50 $1,000,000,000 for $1 of 1,000,000 BTU of NBP, only on the GAAP share of the gas production, which is linked to NBP.
So cash flow allocation, this scheme does not change. The shape is changing, but the content is still the same. And so we are consistent on it. We allocate the cash. Capital investment, the discipline is there, dollars 16,000,000,000 $18,000,000,000 $18,000,000 next year, like this year.
But this is the guideline we gave you. As a dividend, we announced 5% to 6% increase in September, doubling from a 3% increase, so from 3% to 5%, 6%. The last 2 quarterly dividends were increased by 6%. And so as the results for the full year 2019 dividend, the first two quarterly interim dividends were 3%, which results at around 5% increase. So consistent growth is okay working the talk, I would say.
And the balance sheet gearing, again, it's a 3rd priority for us because in the volatile environment, we consider is we need absolutely to have this low gearing under 20%. The IFRS 16 increased by 4%. It's just an accounting issue. The acquisitions, of course, have also stretched a little bit with the Mozambique acquisition, but we are committed to come back under 20% as soon as possible and quickly and to maintain a great AU18. And the last part of this allocation are the share buybacks when we have more cash.
So we have announced in 2018 a program of €5,000,000,000 We've done 3.25 dollars We are for 2020 at €60 As we said, by the way, in 2018, we can deliver €2,000,000,000 And so this we will execute this program of share buyback. A word about ESG. We have a lot of questions from investors about what you do in ESG. I think, again, Total has a strong commitment. We are recognized by the Global Compact as one of the lead company in the last 2 years.
We made some we there again was the talk, I would say, in transparency and management on the E, we issued our climate report. We also assessed all our industry association memberships about the climate stance of each of them, and we decided to exit one of them, but also advocating in the U. S, for example, to maintain and to not relax in the emission regulations, because I think it's very important that we can be stewards for the natural gas products that we on which we base as part of our growth. And in the Soles Best part of EAG, I would underline that mixity, gender diversity is becoming is a reality in the company. The executive committee is leading by example and the Board of Directors also.
And in Governance, I will just underline again 2 actions that which have been taken through initiatives, not only the link between climate CO2 reduction targets and viability, but also we have adhered to some responsible and sustainable tax principles with the BT, which means no aggressive fiscal policies in the company. And we are also acting and taking the lead on 0 tolerance against corruption around the world. I'm showing myself the part the initiative of the World Economic Forum on anti corruption. It's a matter of living clean field for large corporations like Total. This is recognized by some rating agencies like CDP, where we have the A minus rate, the best score is the best score among the all in GAAP majors.
So in terms of delivering shareholder return policy, just to make some advertising for us, we made not only the 2 year TSR, but the 1 year TSR, the 3 year TSR, number 1, a 2 year TSR around 10% number 2, on 1 year 3 year. So we are honest. So we can say that we are really today offering to shareholders a good return, best in class TSR, and I think it should be also underlined. So to conclude this presentation, which was maybe a little long, but 7 voices is longer than 2 voices. I think, again, the message are clear.
We are working on delivering 1st. This is a priority for the whole company. And we should never forget that, of course, we work to prepare the future in the energy field. But at the same time, what we are first is delivering and this is the conditions, I would say, for gaining the right having the right to invest for the future. So growing the cash flows, releasing production of the breakeven under $25 discipline on operating CapEx.
We executed the strategy by upgrading the portfolio, announcing profitable projects on the M3, developing our LNG position and delivering cash flow from it, but dancing also with, I would say, focused growth of ARIA, petrochemicals, no refining and some large market, emerging markets for marketing. And on both sides, by the way, contribution to low carbon emission of the group, which is also important in the electric mobility will become modularity in Europe, so we have to adapt ourselves and continuing to seize all the opportunities in the energy market, including in low carbon electricity. And we do that, of course, and by quite increasing the shareholder return. This is our commitment. I would say today we have announced something quite the same time.
There are 2 several questions, the 2 of them, I would say, or 3 of them, which are symbolic of what we do. On one side, these results, which are, again, I consider are resilient and strong and increasing cash flows and shareholder returns, despite a weaker environment. And there is another opportunity, which is our investment in India on solar. I would like that way to thank Namita because this is a group of it's not only a matter when we work on solar, we don't only work with Philippe teams, but we leverage all the knowledge around the table. And Manita, for this reason, has been the key driver of all these investments in renewables and managing with partnership with the Anadio with Adaniyo.
So thank you, Namica, for that. In the way, we work together, like Momar is working and still advising us on Africa, I would say, in order to leverage the maximum of competencies around the table for the future of the group. And I think these two Chris, release for me, are quite a symbol of that we can, at the same time, be good at delivery and both deliver also of being part of the energy transition and increase the cash returns of shareholders. Some people are asking questions, can you do both, working on energy transition, increasing cash returns to shareholders. I think it's not at all mutually exclusive and this is exactly what we want to demonstrate and we are demonstrating to you.
And this is, by the way, the conditions of sustainable return to the shareholders' total for the long term.
So thank you for your attention.
And now we'll be ready to answer to your questions after the presentation. Michel, start the year.
Thank you, and congratulations on a strong set of results against the backdrop of quite a difficult macro. I have two questions. The first one relates to the LNG market. As Helle highlighted, it was a strong year of growth from a demand perspective, 13%. Some of it came from low gas prices and stronger for the BGT.
And one of the key questions long term is if we want a strong growth in the market, prices probably need to remain relatively low. But then at the same time, we need new supply. And at the time of fewer long term contracts, that could be difficult under volatile and low gas prices. So how do you think about a good long term gas price to both incentivize demand but also have decent profitability? And how do you compare it with the minimum gas price that you need to achieve a good hurdle rate in your new projects?
And then if I could ask also a second question. When you think about your business, in the past, you had to run it mainly for financial budget. But today, you also have effectively a carbon budget to look after. And when you think about implementing it, how what is the best way to do it? Is it through higher hurdle rates in your new oil investment?
Or is it, for instance, by applying a carbon price, including scope 3 in your new investments?
Okay. First, LNG, I think, is interesting. I think, again, it's for me natural gas is competing with coal, not with oil. So this relationship, historic relationship that we should target is sort of oil equivalent is wrong. We have to be if we want the project to be resilient, we are more looking to the I mean the equivalent of 11% of Brent.
If you want, rather than 13%, 14%. So when you test the project, we have to keep resilient assumptions. By the way, the assumption for natural gas are around $6 per 1,000,000 BTU long term, while we take $70,000,000 I mean, we are prudent on all natural gas essential. Why? Because we think that this market is really going to be commoditized more short term, more sports.
I think the idea that you have long term contracts, of course, we and by the way, it was a beauty of the Mozambique LNG projects, but the teams of of Anadarko have done an incredible work to be able to find 10,000,000 tons of long term contracts, both good relationship to oil, by the way. So we will benefit of it. But if we are we have to be pragmatic for the future. The next project, we have to be able to market it. And this is why we implement this strategy described by Philippe, which is to be it will be more trading market.
So you need to have the logistics. And you have to have the regards, to have the customers, to have the fleets. And if you want to be able to move and to maximize the value out of this business. So yes, that means that also, which I strongly believe, the capacity to take the risk to large projects will rely upon few companies with a strong balance sheet, able to face this market, which is exactly why we think that this is a perfect market for a company like Total and why we developed this strategy. So yes, be prudent on the long term gas price when you sanction your projects, that's obvious.
Otherwise, you could have some, which means also that, again, in I think things would change. But in the U. S. Market, obviously, where we you have these low environment projects, which are promoted today by, I would say, utilities and utilities type where you think you can make the money and another will take the risk, the downstream risk, taking the offtake this as a limitation. I think this has a I would not be surprised to see a less slowdown there because who is ready to take this risk for somebody else being sure to have 10% return like a utility once the others are taking the risk.
I'm not ready to tell that. It's why we integrate on Cameron and we are discussing the business model with St. Cloud, but what will be the next phase of Cameron because obviously we should align the risk and rewards on such projects. Otherwise there is something wrong. So we can take the risk as and I think again the competencies of the teams, the logistics, it's investments in logistics, particularly.
You can trading is a matter of optimizing logistics fundamentally. And so I think that's why also we put together, by the way, we move all the trading team of natural gas from London to Geneva. It's not because of Brexit. It's because the competence of this, we think clearly this and the fact that they are all there together is quite impressive, a huge room. I can tell you they deliver all these synergies, between both teams working together.
The best car have been geographically well planned in order for maximizing and learning from each other. So I think that is there for a company like that are source of added value for the future. Coming back on oil, yes, we put, by the way, a carbon price. We put $40 per ton now, dollars 40 per ton in all the projects systematically. Is it enough?
You can increase it. Honestly, I will tell you. The reality is that $40 per ton, it impacts your project by, let's say, 0.5% of IRR. Does it change the decision? No.
Because either the fundamentals of the oil projects are strong in terms of cost per barrel, in terms of technical costs and in terms of breakeven or it does not work. What it will influence is obviously a very long term project where you will have them not to keep water but to increase it. And back for me to oil sands again where we will not invest in oil sands. Does it eliminate deepwater? No, because deepwater is more short term projects.
When we invest in exploration in Suriname, which I hope will be a success, I mean, we will explore during what? The time of exploration is something 6, 7, 8 years, let's say, when you produce most of it in 10 years. So it's a matter of 15, 18 years, in fact. So in fact, you can capture this value in an environment. And I can tell you, we continue to have oil in 15 years in this world for quite a lot of consumption.
So I think it's again, for me, it's a matter for selecting the right place and being stringent. We continue to approve our projects at $50 per barrel because this could come. This could come lower and pressure on the price and this is a condition for being able to maintain investments in all projects. But there is still so what I'm seeing is oil, let me be clear. I mean, even if it's maybe not oil, as I said, it's liquid, which means a new blending of oil and biofuels on the difference, but we'll need liquids.
You will not be able to drive a plane longer than 1,000 miles without liquids. It's a question of storage. It's a question of so let's work on this type of approach. And just two questions, if I may, as well. The first one on Renewables, where I think you've grown your own capacity already quite fast with more plans to come.
And I wonder, for that future growth, what is the constraint? Is it capital? Or is it opportunities now that you've been around the world a few times dealing with easy and difficult partners? And the second question hopefully is a quick one. I wonder whether perhaps you, Jean Pierre, could translate the €18,000,000,000 all in CapEx figure into something that's comparable with, I think, again, which was a very impressive EUR 13,000,000,000 organic CapEx spend for 2019.
€14,000,000,000 Close enough. It's not stated, that's true. First one, let me be clear. On Renewables, first, we keep the discipline. We want the budget to return on all the projects we've done.
The Indian project, the Indian investments we just announced, dollars 500,000,000 is more than 13, let's say. Okay, now just to give you an idea. And we keep it on systematically. Okay, the business model has to be, but and we can do it. Of course, it took us time to understand when we win in Qatar, we are all contenders.
The reality is we have more contenders. We have different competitors there, utilities, new players. So this is a different field, but we keep the discipline and we can do it. Then we are not limited by financing today. No.
We are limited by the opportunities. Why? Because we have a lot of competitions and when bidding honestly it's tough. But it's also this is we have teams, as we said, but we have many in France. It's an ecosystem.
We have the subsidiary, Total Year End. We have the Sample. We have the Total Solar. We let them develop. But it's a matter of increasing competencies again because these projects take time.
Renewable project is not it's easy to execute, very different from our the 800 Megawatt solar front in Qatar will be into production for half of it in 1 year. So the competence you need to have is more people able to commercial. So supply chain control is very important. So now we have developed that expertise to be able to put together what are the best Chinese producers for sales in order to mobilize them. But the larger the project will be, the more we are comfortable.
Offshore wind, obviously, is a field where we look at it, even more capital intensive. We have set a team for floating offshore triple wind. We've been, by the way, our new teams, I want the exploration, the production in E and P engineers quite motivated, by the way, because we know what is a floating unit, we have done that. So we can leverage these expertise and we think that again by the way in renewables, don't forget that we will see the same evolution in LNG. I'm convinced that this renewable business will not be a regulated business in so long.
It will become a merchant business in many countries. And then the capacity to be able to sign PPAs on the long term, you need the balance sheet, you need the counterpart. So it's a business where we can also leverage part of what is strong in our company. So there are things there where we can really deliver for
the future. Of course, we need to
grow because we speak about gigawatts, but a gigawatt is nothing. A little bit clearer. Gigawatt of solar, it's I always translate that in 1,000 barrel per day is 2,000 or 3,000 barrel per day of oil. So people think the giga is big, no, it's not big. But so we have to be realistic.
If we want to be a serious player, we will have to go and to invest, that's clear. But keeping again a double digit return, I'm and so it's a matter of growing the teams, growing the competitive, differentiating, I mean, having again, growing the ecosystem, different GV on different countries because the other point is that it's more local business. We don't develop the Indian market, it's not the same, but what you can do in the Middle East or in France, not true. So you have also to have local teams and local competencies. But again, we've done that in marketing and services for being local.
So it's I think there is ways to find a profitable growth. And again, when I look to what the society is asking to us, we can do it. My commitment or commitment to the shareholders is that it should at the end grow the returns, the cash flows and be part and I think it would be a fruit of the sustainability of our dividends and share return to shareholders in the future. Irene?
Thank you. Irene Simone, Societe Generale. And can you please clarify the terms of your deal with Apache in Suriname? Secondly, your production guidance this year between 2% 4% depending on Anadarko. Obviously, you've closed Mozambique.
It seems to have stalled elsewhere. So what happens next? And is there any time limit? And then finally, on OpEx, I think Jean Pierre highlighted the benefits of centralizing procurement. But the rate of that appears to be quite slow.
I mean, you went from 15% to 50% in about 4 or 5 years. So is there any particular obstacle to speeding that up, setting the pace up? Thank you.
I will let Arnaud, but know the central procurement team has been established in 20 17. So I know Life is quicker than Adarndo will come back on it with maybe Namita as well, which is in charge of this team. You can take the question, Namita, on procurement. And I would say, first, Apache. Apache's deal is quite clear.
I mean, it's quite simple. We pay $100,000,000 upfront, so to have access to the exploration license. And then we will carry Apache for 6 big amount, but it's a short term financing because we will recover all the carry from the cost of all of Apache. And if it costs so enough, we have a system to have access to more of our share. So it's a we use our balance sheet.
I would say on Appreciate, I think probably the perfect example. It's a company with a limited competence in the quarter and limited balance sheet. They came to find a partner. We offer the competence in deepwater. We become operator and we offer the balance sheet.
And so we offer them in fact at the end, as I said we said in the release, this is a big amount of carry, but when we translate that in dollar per barrel, it's around $2 per barrel of cost of acquisition. And to be clear, when we made the deal, we had already the results in front of us as well. And so it was not a pure exploration acquisition. We knew that this first we could look we had the data in front of us. So we knew that there was some hydrocarbons and probably more to come because this first well has been stopped because of a pressure at a certain horizon.
As we know, there is more under, but the architecture of the well was not strong enough to support a deepening of the well. So I mean it has been so it's clearly something where we have leveraged 2 of the strengths of the company in order to have access to something which could become, I hope, it's a declaration, so again, I push wood, never heard of that. We could have access to a very interesting license in the trend of all the discoveries in Guyana. Anadarko, let's be clear or very clear where we are. It's where are we.
So Mozambique is closed. It was a joint decision, joint decision with our C and S to close Mozambique as quick as possible. It was our interest because it's project going on, FID. So embarking, being on board was a priority. We know what you and you know what I think about the good financial conditions which we acquired in Mozambique.
I think it's very competitive. We have just closed South Africa last week, a small deal that is down. In Algeria, the debate today is between the authorities I've said to Oxy that the change of control from Maladarko to Oxy can be preempted by them. Again, with us, by the way, the fact that the Algerian authorities have a provincial right, we knew it and we respect the rules and in this country where we are. So it's not a matter of the transaction between Oxy and Total, it's Anadarko Oxy, which I would say Oxy is dealing with the Algerian authorities.
We are there and we respect the deal, but if it's preempted, it's preempted. And so I think we'll have clarity, but you probably noticed that in 3 months, there have been 3 changes of CEO in SunTrust, which must not help, I would say, the momentum of the discussions. But we are there to answer to Agenain and authorities. And in Ghana, I would say there is a fiscal discussion. We and Oxy consider that it's written that there is a tax stability clause in the contract.
Again, again, unfortunately, seems to find a way to they want quite a bit capital gain tax. This discussion is going on. Let's discuss. I mean, let's say, again, it's a matter of convincing people that Huawei is alright. Honestly, by the way, and I say that positively for Mozambique, if we have been able to close, and it's a big good signal to me about Mozambique, is that the governance of the country is quite despite of what I hear, I can tell you we sent a deal beginning about this.
And 1 week after, we had the right calculation of capital gain tax, no complications, smart way to work. And we very smoothly, we managed to close in a record way into month, level to month, which is good. When we invest quite a lot of money in the country, it was a positive signal to us and to the way we have been welcome. But these processes can be sometimes tricky. We have experienced in some countries, Uganda.
But let's work. So of course, as you know, I think the Occidental wants to close as quick as possible. We are there, but we want to do it in the good conditions to be done, okay? That's the situation on this deal. And but we are very aligned with Occidental, but the way forward, let's so it's why we put, by the way, on the production, because we don't know exactly when it will come and so and if it will come.
So if Algeria does not come, obviously, we'll not have the production, but at the same time, we'll have we'll not have made the investment. Sorry, Namita has to answer to centralization of procurement.
So we put together
our TGP in September of 2017. So 2.5 years later, we are over 900 $1,000,000 in savings. Our target over 2 years was $1,000,000,000 So we are we're going fast, I would say. Jean Pierre talked here about our centralization, which our target is 40%. We should be able to reach this year.
But what we didn't talk about is we have about 30% of our procurement, which we put in a category that we call piloted. And piloted means centrally, we look at everything that's happening globally and we put together contracts that we negotiate with large suppliers that negotiated prices that then gives the option for different affiliates to use those base contracts to then do their own procurement. But it's very piloted and that's where is another source where we will be driving down costs. So I'd say don't just look at what we put in centralization, which is purely managed in France, where we do all the work from A to Z in France, but we also do a lot of piloting where we make sure that we are aligning our policies and our prices across the world.
Mucho, mucho.
Christian Malek from
JPMorgan. Thank you for a lot of great information and detail on a new transition that you're trying to do. One thing, Eric, because you sound quite theoretical, and I might confuse you
in the question. But you mentioned and
you were making this point across the challenge around trying to deliver energy but lower carbon energy. And within that context, demand will be bifurcated in terms of how we can solve for that demand of energy in the context of low versus high carbon. And when I think about breaking out demand and thinking about Africa as an area which is as an area which is consuming energy and low cost energy and where you're placed in Africa being a very large part of your portfolio from a cash flow perspective, What I'm trying to grapple with is the challenge of you generating low carbon energy in the continent, which is screening for low cost energy and the dilemma in that in terms of solving for it, particularly as you're going through scope 3. And I hope I haven't lost you at this point. How do you see your portfolio fit in terms of exposure to Africa you solve for that and being able to do what you've done in the year versus being able to generate renewables as part of their energy challenge.
But equally, you do it in a continent where you're going exposed to, which is almost going the other way in terms of looking for even lower cost energy, which is not conducive to non oil, but actually more conducive to oil. So sort of a question, but also a comment. It's much more long term. I'm just trying to understand how you think the strategy around the portfolio in that context. And the second question is thinking about M and A.
And you talk you've done some great deals in the past. And M and A is clearly opportunistic, but also has to work from a returns perspective. As ALCO, some great transactions there. As you think about M and A going forward, will it be oral or non oral? Oil?
What's top of mind in terms of being able to deliver? And if it's non oil, how big would you be willing to go? The oil and gas, I mean.
Okay. Two strategy questions. You take the first one, Helene, about Africa or you want me to answer?
No. I mean, I think we can maybe take this offline because it's a long question. I would say Africa, like many other places, will have to rely on a diverse an energy mix as possible. I think there's room for all energies in Africa. The roadblock for Africa today, if I make a long story very short, is simply the electricity grid.
We are building renewable power plants, as Patrick showed on one of the charts. But of course, in many African countries, the grid is not reliable. So it doesn't help to just add more renewables. In some countries, it works well. In others, it doesn't.
Some countries have hydro, others don't. Again, if I super summarize, a big opportunity, but also a fight is indeed to displace coal for those countries that either have coal or had existing coal plants and are importing coal, which is back to Patrick's point on cheaper coal versus cleaner gas. And so we're working on that. We mentioned the win win in Benin, the lead we have in the Ivory Coast or in Mozambique. And that is for sure the deal.
As you know that the easiest way to reduce emissions short term is
billion time I have the same answer, it's $5 per million BTU. $5. And the $5, you'll find a way. About 5%, I don't know why, but it's almost the same answer. South Africa, I discussed recently, and India, same figure.
So it's Pat. The reality for us is that we need to continue to drive down the cost of projection and logistics of natural gas. This is a
clear condition and this is where it's our duty. If we are able, I say to Philippe,
I was in Asia, if we are able to deliver a long term contract of $6 or $5 we'll sign plenty of natural gas. But this is where our mission is somewhere. And even for Africa, Benoit was a good example, Ivory Coast. Why do we spend 3 years on Ivory Coast? Because at the end, this is a I think there was a competition, but again, a coal fired oil plant and a gas fired, because this, you're right, their access to energy is just a fundamental thing.
And on renewables, I think they are today, it's not doing as quick as possible because there is a lack of regulation, a lack of land management. Owning the land is just a question of who owns the land, so it's complex. So it's growing much slower than expected in Africa because people have a confusion between access to energy from few solar lamps in the village and the real industrial capacity, which is a 50 megawatts or 100 megawatts or 200 megawatts. And that's it's very small in fact. So this is something like it's not a way forward on a
large scale, I would say.
So it's still for me a continent where maybe a potential, but a little immature. On our side, I would say the best asset we have is that we are local in many of these countries. We are there. For marketing and services business, we are there. We have seen the impact of Mozambique, for example, the fact that we have these retail stations.
We came. We are known, we have the reputation. And I think on that, we could build on this continent for the future, which is a growing population, growing economies. And by the way, but from a pure geopolitical point of view and geo economy, the interest of Europe is to try to localize more people in Africa rather than having new creations. It's nothing to see reverse.
So I think we have to keep this long term vision on Africa. The second question, it's an excellent question. Let's be clear. On Oil and Gas, I'm still driven by the idea that you make money when you acquire at the right price for the low cycle. Honestly, 7264, which were the average over the last 2 years, is not really a low cycle because when you have on the screen $68 or $70 people want to send to you at $70 So you could have and then you are not there.
Like we were not there in the TOA licensing run-in Brazil because it was $70 So we were not there. So then you could have specific opportunity, Michael and Adarco, moving quickly on somebody who was ready to negotiate and I see Mozambique is a good acquisition. So but so you could have some specific situation where you could, I would say, take benefit from 1 seller. But to negotiate when the price is at €65,000,000 and you want €50,000,000 doesn't work. So let's be patient.
So I think for me, it's being opportunistic with Total having in mind that we play to a size. So you will not see Total buying a shale oil company in the U. S. Forget. It cannot be more clear, clearer than today.
I repeat, because it's not part of the strategy and it's not because today, by the way, I didn't see much in the last year, there was many transaction all in shares, no cash in any transaction, no fresh money coming in the U. S. Share.
It's not a criticism. It's just
a BN. I understand the logic of some of my peers. They do it. We don't do it. By the way, I think that we have no shares, so no write off and no problems today in our own results because of the but again, so this is for oil and gas.
So it's a matter of for me countercyclicality. Then you ask another ensuring another question, which is out of oil and gas. For the time being, we are comfortable with, I would say, this €500,000,000,000 bolt on acquisitions like India. We go by I'm not yet ready to make something at the larger scale on this field. We need to understand better this business.
It's a question. We learned a lot.
And it's a matter
of risk management. This team around the table, 3 years ago, we had no idea, no issue ideas, but not many ideas about the power business, how does it work, what are the great competitions. We need to be before we can maybe one day do something, but it's not on the agenda today, I would say. But again, the intent is to continue to grow this electricity business. I'm very clear, we set the target.
It's not only a matter of scope, it's a matter of the energy market will evolve. So we need to prepare the future of the company. And electricity markets are developing then the demonstration we have to do, but we do it better and better to our Board. We can bring them projects we have a double digit return. If it is the case, we will do it.
And we'll continue and grow it.
Thank you. So in the essence of the time,
I won't ask a long term strategy question. Just 3 very quick numbers for you. Not one, but 3. Very short. Good introduction.
Very short. Marketing services, the $100,000,000 is a very nice number for us to model the news forward, but you beat the number quite well last year, both in lubricants and retail. So just explain what was happening there and could we expect that type of coming through? What? Add a key.
Second one was the $4,000,000,000 of cash flow from the big 4 in the upstream, what length of visibility do we have in that $4,000,000,000 repeating year after year? I guess the deepwater projects will roll off at some time. And then thirdly, LNG, 25% of your sales were spot cargoes last year. What portion of cash flow did that contribute to your cash flow last year, please? So Philip, the last one.
The second one, I would say, 3.5 on average over the next 5 years, just to give you a guidance. So it's not bad. I see your increase, which is partly due to some OpEx, if I remember, some we had €300,000,000 growth, actually out of those €300,000,000,000 or I would say, exceptional items by reevaluating some contracts, what we could open because at end of 2018, the price were low. They were a bit higher in 2019. This is the gap.
So I guess if you take that out, the €100,000,000 is there and you can model that in your model as I have said. Yes, which is an effect that we had on the working capital. We have the counter effect. The end of price the end of the the price of oil at the end of the year, last year was quite low, it's about $54,000,000 $56,000,000 This year was $68,000,000 So this $12 had a positive impact on some open positions, which is a one off which we normally disappear. So we are very honest.
So it's not it does not manage to increase its cash flow by €300,000,000 like that. But we have you cancel effect in the working cap. The increase of €1,200,000,000 is mainly due to the revaluation of inventories. On one side, it's a result of the other side in the balance sheet. Okay.
Philippe, your spot activity and your bill $1,000,000 for
volume to trade? The spot activity, you have to understand why we are pursuing the spot activity. It is not to make a profit per se on the spot cargo. In fact, we use the spot in another cargo going from Yamal all the way to China. If I have an opportunity to buy a spot cargo in Asia and deliver to my customer in China, I will do it and I will put the Yaman Energy Cargo to another market, B2 or another one.
So just one element of the global portfolio, and this is why I cannot tell you what is the size of profit that we generate by this portfolio. But what is clear is that when we say overall on all our flexible volumes that we generate some 1000000 BTU on average, the spot is one way to, of course, generate this order. So if
you convert 5,000,000 tons, you make it live in 1,000,000,000 BTU by 0.8 and you have the answer as an average because it's not we don't follow each deal 1 by 1 and if you have the average. Lydia?
Thanks, Roger. Roger. Two quick questions. The first on digital, seeing as we are in Aberdeen, I guess, some time talking about this afternoon. How does this approach change digital over the last year?
Have you just accelerated from what it was? Are you seeing better savings? So just a little bit how you think about the digital side? And then just a tidier question on production. It was nice to see Tempurosa actually coming on stream.
So any kind of comments on how that ramp is going? But also, what are you including for Libya within the guidance for this year?
Yes. Thank you for the question, because we did not issue a press release because we are very it took us 18 years to put that into production. So we are super superstitious, super one. So it took here 18 years, 1 year in a half to have the right to produce, which is incredible in Italy, it's a country, and there is no oil, but 1 year. So now it's done.
So I don't want to announce anything public because I don't know what will happen. So it's producing, by the way, 15,000 barrels per day, I think today. It's ramping up to 50. So things are in action. It took time.
Sorry for that. But no, it's by the way, it was why we made 8.7% 109% this year. With a small gap. We'll not complain about 9% or 8.7%. So it's Tempa Rosa.
Libya, Libya, Libya, you will read the newspaper like me, there is a blockade on all these production. I mean, today, I think the production is going down to 200,000 or something like that. 250,000. 250,000 from 1.2. So we will separate from that.
Okay. That's not small, but it's part of when we put the 2% to 4%, the 2% is a certain prudence. Some people could be surprised that organically, we must have a little higher figure, but you have always some in execution, nothing is perfect. So the 2 are taking part of the prudence, I would say, a little prudent. That's point.
Digitization accelerating. What I would say to you is that we have, by the way, awarded a contract yesterday to set these digital plans with 3 100 engineers yesterday to Accenture. So it's moving forward quickly. What I've remarked is we already anticipate some of those teams of Refining and Chemicals, of Bernard, of Arnaud. They want to make so it's the idea to have 20 back it's a plan.
We will have 20 lines of production in parallel of teams, agile teams, able to deliver every 4 months, more or less, a project. So 20 times 4 months for a year to make 60 projects per year. So it's a way to scale up and to speed up and to scale up all the digital, I would say, implementation of this technology in the company. Today, it was 1 by 1, where the fundamental idea is to be able in parallel to have at least 50 projects per year and not only to scale up there, I would say, the creation of the development, but then the implementation within the group because it's a matter. So you will have some more insights this afternoon from the teams here in UK because it's not really a central approach, it's also decentralized.
I think Vivei will come back on it, if I can say. Somebody wants to add something on it. Somebody else? Two questions, if I may.
The first one, have
you changed your long term assumption for either a gas price and oil price for your impairment debt? You were using $70 I think, Clive. Gas or oil? No, dollars 70 for Okay. We'll come back to you in.
So if you can clarify now, what's your, I would say, long term assumption for impairment test? And the second question, which is also a bit related is you are quite, I would say, not very optimistic for long term gas price or for LNG price, you were I think you said $6 per MBtu or $6 to $7 I just wonder how do you think you can make money out of your U. S. LNG offtake given the condition under 15% of Enriere plus a fee plus transportation? Okay.
Philippe, you take the second one. Jean Pierre, you explained your impairment assumptions? Yes. So I mentioned to you during my presentation that we use a long term trajectory in line with the SBS scenario. So that means oil by 2,050 will be at 50.
And for the gas, we are very conservative, so we are below the 2 year scenario. So to be precise, it will be disclosed in the document reference. We are fully transparent. So, it's a little more complex, but it's like we consider today we are at $60,000,000 $64 We consider that the oil price, by the way, like the SPA scenario of the IEA, which is going quite high, will increase until 2,030, we'll have a plateau of $70 because we think that there was an underinvestment in this industry And that these underinvestments, despite the shale oil, will have an impact. So we have a curve.
And from 2030, then we go down to go down to 50. So we have a straight line, the other. So it's a total 70 going down to 50. So and you will see. So it's not one assumption, it's a little more smarter.
Why? Because we think that the world is not today on the 2 degree scenario. We will be one day maybe. But today is more on the, I would say, the current scenario. So we don't see why we should take the lower one immediately because again, on the impairment test, the time has a value.
On the gas price, we had nothing to modify because we were very conservative, 2.5 for the U. S, I think 5 or 6 for Europe. So we kept the same assumptions because our assumptions were already quite low. And I think we made already the write off in the past on the 2 shale gas we had in our portfolio. So it's not much to write off yet, which has been done systematically.
The $2.5 has been taken as an assumption 2, 3 years ago, so it was down. That's the point. So we are on this 3,000,000,000 and you will have all the details.
I can keep the tricky question, but clearly, if you take long term approach, our opportunities will be between, let's say, 6 $300,000,000 and $300,000 BT when you start with Enrea. But at 3, you don't make any money. You don't lose, but you don't make any money. What is the consequence? If there is no LNG developed in order to export the massive amount of gas that will be exported that needs to be exported in order to continue to produce in the Permian and so on, you cannot stay with the lot of new VCU in the U.
S.
But there's no way we have an assumption.
Why we are very sure of the NREA?
We have an assumption of 2.5. I just tell you that's 3. So fundamentally, our U. S. Position is based on the idea that the gas price in the U.
S. Will be low.
And if I might add, the cherry on the cake is that all the U. S. Volume are flexible and this of course has a value, dollars 3,800 per unit as a value. So if you are a global player like Total, you can generate this kind of value. If you are, I would say, a simple minded player, I have in mind, I will buy this LNG from the U.
S. And ship it to the same customer front end in China. Don't go away, fly away. I think there are some people who had a lot of trouble when due to Mr. Trump and Mr.
Xi Coral, there was, for instance, a tax on importing U. S. LNG. So you need to be a global player to make money again. But there
is a consequence of what we said that we don't want necessarily to produce the gas we use in the U. S. Because we have plenty of gas. And you can find today all producer ready to commit your gas at a very low price, if you want to do it.
It's Jason Penney from Santander.
Two short questions, please. First, on tax rate guidance. Mostly below estimates for tax in
the Q4. Where do you think
we're going to go in 2020? And then secondly, on going back to LNG, I think 2 Chinese competitors at the minute are declaring force majeure for February March deliveries. What event is being said as the reason for force majeure? So I wasn't aware that weak demand was causation for force majeure. And if force majeure is being served, are you seeing those notices yet?
And what kind of impact could that have for your LNG volumes in the second and third quarter?
Yes. So the tax rate for the group last year was at 34%, so down by 5%, directly in relation with low pricing environment because at the same time, you had the contribution of E and P that has been reduced and the same for downstream. We consider that now and last year, we were in the $60 per barrel environment. So we anticipate at $60 per barrel more or less the same tax rate for this year. So I would say 30%, 35% for at the level of
the group. And for E and
P alone between 40% 45%. That was again, it's dependent on the price Yes. So the 4th measure will not receive any notice, but Philippe will The basic situation in Asia clearly
is that the winter is warm 3 degrees above normal. The demand is on the low side and there are a lot of people, a lot of customers that have completed long term who have too much LED first. 2nd, it's clear with spot prices that are very low, as you can see on the screen. There is a strong temptation from some long term customers to try to play with force majeure concept to say, okay, I cannot take my contract my cargo under the long term contract, but I would like to wait to buy spot, which is a bit contradicting. The last step, yes, might get a bit more serious because of course, in the coronavirus, some Chinese customers like this one is trying now to use the coronavirus to say higher force majeure, the tariffs cannot be used and so on.
So I have real force majeure. We have received 1 force majeure that we have rejected because it's not our legal analyst is that there is no force majeure. It's I would say the way we negotiate on an ongoing basis with the Chinese. Of course, we have to be careful. If there is a rural quarantine in the all year loading ports or unloading ports in China, we have a real case for Fortune.
But for the time being, as you might be aware, this is not the case. So for me, it's ordinary negotiation.
You have the question in front of us, Casey Gammel, Jefferies. 2019 was a very big year for Taqao in terms of sanctioning LNG projects, but it does appear like the industry is sanctioning quite a bit of capacity as well. I know that you're looking at the multi decade period when it comes to evaluating projects. How do you think about the potential for the macro to be oversupplied again in 2025 the way that it is today when it comes to evaluating that you go forward with incremental projects. And then just specifically in Papua New Guinea, is the delay in the expansion of PNG LNG going to have any effect on Papua LNG moving forward?
So first, yes, it has never been a very linear industry, the LNG. There was no sanctions during 5 or 6 years. Suddenly, people are sanctioning projects and we'll have a gap again. By 2022, 2024, 2024, if we continue at the pace of 10% per year, I can tell you, you have a big tension on the supply and you don't have enough because there are no trains coming really on stream that's enough. So and then 25, yes, it's clear that suddenly you will have a wave of projects.
We'll see if all of them are executing in the same time frame. We have observed in this industry and unfortunately we have very good example in our portfolio like L'Amal with some examples like Texas where it has been more 6, 7 years than 5 years or 4, 5 years. So we have very much of execution. Yes, it's clear that today you have many projects coming together. I would say it's a matter of each decision.
I mean, at the end, it's having each consortium or each operator is looking to each investor to is the project resilient, even it's a question of the answer of, obviously, the question of Michele, what is the assumption you take? You have to face the reality. If you think that you can have $8 per 1,000,000 with you in such an environment in 2026, I'm afraid you are wrong. So you have to be prudent in the way you plan, you decide, you make your decisions. And I would say from this point of view, being the first to decide is better than being the last one because the more you have sanctions in front of you by the others, we begin to think I am in trouble or not.
Coming back to P and G, let me clear you know perfectly and I declared that this morning to the press, that these projects are joint. In fact, it's an extension in Papua and P&G. We decide with Exxon with the approval of the PNG government that's the best way, the most efficient way to develop the LNG plant is to make an extension of the existing plant and to add 3 trains, 2 for Papua, 1 for PNG. So we on our side have settled the terms. Exxon has to settle it.
Okay. I don't know if it's the best way to public to make statement publicly when you negotiate, but it's a question of time. I'm convinced that the 3 parties will file an agreement and that the PNG government and will file an agreement. Is it I would say, yes, that's true. But in this context, where does it depend no, PNG at the end is not a big project.
It's a limited project. It's 2 trains. It's well positioned geographically. A lot of attraction from Japanese buyers, Chinese buyers. So at the end, it will be a project which will have to be competitive in this type of low price environment.
That will be the conditions. But I would say with the terms we have, it is profitable. It's okay. So but because of the environment, BK on total side, we are not in the area, we are not driven by volume. We are driven by value.
So if we have to wait 6 months, we wait 6 months. If we wait 1 year, we wait 1 year. We are patient. At the end, I'm convinced the project will be developed in the best efficient way. And the best efficient way is to do it jointly, the Vaxon, on the downstream side.
But we are confident. Okay. I think we've got one last question because I keep time running from Lucas. We didn't have the question of Lucas. We were not happy.
That's very kind of you. So let me just turn to the next one. 2, if I might. 1, I'm going to ask you to let me dream. And but the first one is to JP, and it's just loan repayments from associates, understand the concept, but increasingly coming through the cash flow from operations line, not impossible for me to forecast how much loan repayment is going to come through in any one year.
So I just wonder whether you can make any or give us any indication of the extent to which one would be seeing loan payments coming through the CFFO line as we go into 2020. And the second, the question around dreaming, you suggested $200,000,000 or so of cash flow from operations from the renewable business, the electricity business. I think that's exclusive of the $100,000,000 from SaaS. But you have planned out to 2025, you talked about gigawatts of capacity, you've talked about lots of things that you're doing around battery. When you look at those plans, what do you expect the CFFO to be 2025 from the renewable part of that business, not the LNG and LNG marketing component?
Okay. So first question is loan repayment. I know what it is. Again, if you model all our SMEs, you can do it. So we're fine.
So we're not estimating. For example, but clear that in the CFO this year, we had $500,000,000 of loan repayment coming from Yamal, because the price was good, because fundamentally, because this plant, by the way, it's a good news for you don't have that in your figures, but the production today of Yamal is 20,500,000 tons, 20.5. So the without so the discount is just extraordinary, not only it's on schedule and budget, but it's delivering an increase compared to the initial '18, I think it was, or 16.5, 18. 16.5, it's delivering 20.5 today. So we have this was a plan, more results and planning and productions and cash, which allow us to accelerate the loan repayments.
So this has an effect. Loan repayments is linked to what is the price environment, what is the production. And so it's more difficult to plan. That's true. But it's let me be clear, the objective of all the teams in TOTAL in all these companies is to accelerate the role repayments.
So they have a duty in Korea for HCC, in Satorp with Durango. And generally, I don't know why the whole share of COVID investors are in agreement with us. We are all happy to see money flowing back to the investors. So that's clear. But it's the same mechanism, it's an agreement.
But when you make in the PSC some cost recovery, I mean, at $64 we have accelerated some cost recovery from Kaombo. It's better to start Kaombo at $64 at the 50. So compared to the model, it's the same mechanism and that's linked to the oil price and the production, of course, after the 2. So there is not much difference in terms of models between the cost recovery on oil and the loan repayment in the LNG plant, in fact, fundamentally. Patrick, I'm not criticizing anything.
No, no, but I mean, understand. It's It's not outstanding. It's believe in our $1,000,000,000 plus $60,000,000 next year. Believe in it, that's for Rotter, and we will deliver it. That's why the guidance we gave, okay?
And it's taking into account all these effects. At the group level. The group is large enough with many assets, but one will deliver, the other one will not deliver. So it's not linear, all that. And it's the advantage we have a large portfolio of assets and this type of assets.
Okay. Now the dream? The dream. The dream is that we gave you a figure to do it's only €200,000,000 of CFFO. So I think it would reach €1,000,000,000 I don't know, I can't put this up here.
No, but I know, I know, I know. I will come back to you in September with a presenter, but honestly, all that is a growing business. We invest and we have to put together. And we have so EUR 1,000,000,000 is a good ambition. Honestly, either we manage to have an acceptable size for all that or we'll have a question mark.
But it cannot be just it's not a pin washing story and to have an acceptable size, it will go through CFFO. That's one of the metrics we need to reach. All right. Well, thank you very much. We are one hour delay.
That's the bad news. The good news is
we can continue interacting, I'd say, with top management our launch, which is going to be served right next door. And I think, clearly, we'll post by 1 hour the program. So we'll meet at 2:30 in order to leave to Westfield. So that will leave us with 1 hour lunch. Thank you.