By TARA PATEL
Total, Europes biggest refiner, plans to adapt its
French processing capacity as fuel demand drops, its chief
executive officer said on Thursday.
Refining has to be adapted to demand and demand is
dropping, CEO Christophe de Margerie said at a meeting
of the French employers group Medef outside Paris.
When demand drops, producers have to deal with
Total has borne the brunt of lower refining margins and a
slump in consumption in Europe
, where it operates eight
plants. In its home market of France, it has joined
LyondellBasell and Petroplus in halting surplus capacity, and
peers elsewhere in the region have followed suit.
Total doesnt plan to pull out of refining altogether,
de Margerie said.
Refining isnt behind us, he said. We
are a recognized name in refining
and we intend to remain
but we have to know how to adapt.
Total reported a decline in Europe
margins in the second
quarter to $10.90/ton of crude processed, from $24.10/ton a
The refining situation in France cant last, de Margerie
was quoted as saying in an interview with
QuestFrance-Entreprises. The company will have
to adapt because the losses are structural.
While he said there is no urgency in Totals
plans for French refining, he declined to give details on how
and when capacity will be cut in France.
The company has already shut a refinery
at Dunkirk and a steam
cracker at Carling in eastern France to lower capacity.
Refiners in France lost 700 million euros ($951 million) in
2013 as margins shrank and the country imported more than
half the diesel it used, the Union Francaise des Industries
Petrolieres has said.
Total has a target to reduce its Europe
business by 20%
from 2012 to 2017. The Courbevoie-based company faced
opposition from workers and the state over the closing of the
Dunkirk plant, and it promised the government in 2010 it
wouldnt shut another site for five years.