Companies Driving the Energy Transition — France TotalEnergies’ LNG Exports, E-Mobility Strategies

Cameron LNG Project in Louisiana, USA

On April 11, 2022, it was announced that a “heads of agreement” (HOA) was signed by TotalEnergies (Total) with Sempra Infrastucture, Mitsui & Co. ltd and Japan LNG Investment. Sempra Infrastructure owns 50.2% of the project while Total, Mitsui and Japan LNG Investment each own 16.6%.

According to TotalEnergies’ Chairman and CEO Patrick Pouyanné: “The expansion of Cameron LNG will contribute to our LNG growth strategy by investing in low-cost, long-term competitive LNG projects with lower GHG emissions.” This statement from the CEO was given to the public as a way to justify expansion of the Cameron LNG project located in Louisiana, USA.

This HOA is significant because the companies agreed to jointly increase production capacity to more than 6.75 mn tonnes per year (tpy). They also agreed to add a fourth train to improve on debottlenecking of the plant. Moreover, the project is seen as a way boost exports of USA LNG in the wake of recent events by Russia to affect Europe’s energy supply.

If Norway’s Equinor took the initiaive to help and solve Europe’s energy crisis, then it seems France’s TotalEnergies is striving to take the lead in promoting Europe’s energy transition. The HOA is an indicator of how seriously the company is taking its ambitions to push Europe forward on the energy transition.

Per OilPrice.com, the French supermajor is the world’s largest exporter of USA LNG and the second-largest LNG trader.

With the final investment decison on the Cameron LNG project to come in 2023, Russia’s invasion of Ukraine has raised concerns of how more exports of USA LNG can be carried out in the present. On March 25, 2022, a deal between the USA and European Union (EU) was initiated for the USA to increase deliveries of LNG to EU markets in the amount of 15 billion cubic meters. This circumstance reveals how critical USA LNG is to the EU’s energy supply mix.

TotalEnergies has been in business with USA LNG since September 2016 when the company acquired 75% of the Barnett Shale assets in North Texas from Oklahoma City-based Chesapeake Energy. Due to declining production, the Barnett shale assets are set to bottom out around 2028. What’s important here is that the production capacity at Total’s Barnett shale fields will allow the company to regasify its natural gas reserves into LNG at Cameron, in order to transport and export the natural gas from USA to Europe, Asia and African markets.

Significantly, TotalEnergies is launching North America’s first Cabon Capture & Storage (CCS) project at the Hackberry Carbon Sequestration (HCS) project. According to Thomas Maurisse, senior vice president LNG at TotalEnergies:

We are pleased to join forces with our partners to significantly reduce CO2 emissions at Cameron LNG export terminal, thus enabling us to supply our customers with low-carbon LNG, a key fuel for the energy transition and a valuable asset for diversifying Europe’s energy supply

Electric Mobility — Automotive Cells Company (ACC)

In 2020 a new partnership emerged in the form of a joint-venture to design and produce electric vehicle batteries. Led by TotalEnergies and Stellantis, the Automotive Cells Company (ACC) brought on a new partner, Mercedes-Benz, in 2021 to become an equal shareholder in the venture. To produce top-grade battery cells and modules, they agreed to increase industrial capacity to approximately 120 GWh by 2030.

According to the CEO of Saft (a subsidiary of Total), “ACC is a joint venture between TotalEnergies and Stellantis to design and produce automotive batteries, and to become a leader in Europe and an international groundbreaker in its field.”

Prior to co-establishing ACC, Total’s electric mobility strategy was laid out in 2019 with the goal to operate more than 150,000 electric vehicle (EV) charge points throughout European cities by 2025, including 22,000 in Amsterdam, 3,000 in Antwerp, 1,700 in London, and 2,300 in Paris.

In addition, Total has taken its commitments outside of the European continent by establishing joint ventures with China’s largest clean energy company, China Three Gorges (CTG), operator of the China Three Gorges Dam, to expand on initiatives for electric mobility in Asia.

The ACC seeks to ensure that battery design is efficient and that battery demand is met for electric vehicles as well as other transport modes such as satellites, trains and planes. Research and Development (R&D) centers have been set up Bruges, France, to design the latest battery cell technologies, while a pilot line at Nersac, France, is being launched as a battery production site.

The ACC is spearheaded by Total’s push to become an international player in electric and sustainable mobility. This began in November 2020 with Total’s acquisition of 2,000 EV charge points from Viessmann group of Charging Solution in Germany, giving it one of the most significant electric mobility markets in Europe.

The company then made a deal with Singapore’s Bollore Group in July 2021 to acquire more than 1,500 EV charge points, making Total the owner and operator of Singapore’s largest EV charging network — Blue Charge. After the deal was made, President of Marketing & Services at TotalEnergies said: “With this acquisition, TotalEnergies is pursuing its transformation and adds a new name on the list of global cities, such as Paris, Amsterdam, London and Brussels, where the Company is already developing its EV charge points installing and operating activities.”

Concluding Thoughts

It’s essential to point out that even when the largest companies are pushing for electric and sustainable mobility around the globe, that committments to natural gas production and exports via LNG continue to grow over time. TotalEnergies even highlighted in its 2021 Energy Outlook that natural gas and renewable energy sources would play complementary roles to achieving the energy transition toward Net Zero.

One of the concerns is how geopolitics and international events are going to affect the global energy outlook and prospects. For instance, Algeria and Morocco have both announced plans to source more gas reserves to the benefit of TotalEnergies, Eni and USA exporters. But underlying political and territorial issues between those two countries are inevitably going to be a major problem. Algeria cut off Morocco’s access to its gas pipeline in 2021 after Morocco announced that it would develop LNG terminal capacity.

Finally, while many countries are shifting to LNG as a way to decrease their exposure to traditional sources of fossil fuels, there are many countries who simply cannot afford LNG or do not have the capabilities to regasify, transport or store it. DownToEarth wrote about this problem with LNG’s future in the global energy scenario.

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