Climate change-related challenges

Risk mapping

Table of an extract of TotalEnergies risk mapping

Following the recommendation of the task force on Climate-related Financial Disclosures

The pace of the energy transition deployment and the evolution of the demand induce transition risks which include policy and legal risks, technology risk and market risk.

Financing of oil and gas reserves induces transition risks which include policy and legal risks and market risk.

Operational risks related to the effects of climate change and extreme events induce transition risks which include policy and legal risks and technology risk, as well as physical risks which include acute risk and chronic risk.

Risk of legal actions induces transition risks which include policy and legal risks.

Reputation risk induces transition risks which include reputation risk.

Risk of skills management and job evolution induces transition risks which include technology risk and market risk.

Energy Production and sales

Histograms showing the evolution of energy production and energy sales between 2022 and 2025.

Data are in petajoule per day. Russia is excluded.

Concerning energy production:

• Energy production will increase by more than 4% per year from 2022 to 2030.
• In 2030, oil products will represent 40% of the company's total energy production
• In 2030, LNG and pipeline gas will represent 40% of the company's total energy production
• In 2030, electricity and low-carbon molecules will represent 20% of the company's total energy production

Concerning energy sales:

• In 2030, oil products will represent 30% of the company's total energy sales
• In 2020, LNG and pipeline gas will represent 50% of the company's total energy sales
• By 2030, electricity and low-carbon molecules, will represent 20% of the company's total energy sales

Over the current decade 2030, TotalEnergies plans to

Oil:

• Maintaining the cash flow engine
• Aligning sales to demand and production

Gas:

• Growing LNG production
• Integration along the LNG value chain

Integrated Power:

• Creating value from integration in electricity
• Renewables: 100 Gigawatts by 2030, ROE strictly above 10%

Low-carbon molecules

• Growing biofuels (SAF), biogas, CCS business
• Developing low-carbon H2 for our refineries

TotalEnergies in 2050: a vision for a net zero company

The infographic describes what could be the 2050 global energy mix according to the International Energy Agency's World Energy Outlook 2021 scenario and a prefiguration published by TotalEnergies of what its energy mix could be in 2050 (energy production and sales).

According to the International Energy Agency's Net Zero Emissions 2021 scenario, in 2050 the global energy mix would be 59% decarbonated electricity (hydrogen, solar, wind and nuclear), 19% bioenergy and 22% oil products, natural gas, and coal.

The International Energy Agency scenario estimated the global need for CO2 capture and storage at 7 Gigatons of CO2.

By 2050, TotalEnergies will produce:

• About 50% of its energy in the form of low-carbon electricity, with corresponding storage capacity, totaling about 500 terawatts hours a year
• About 25% of its energy, equivalent to 50 megatons a year of decarbonized fuels in the forms of biogas, hydrogen, or synthetic liquid fuels.
• About 1 million barrels per day of oil and gas, or about 25% of the total of its energy, primarily liquefied natural gas (roughly 0,7 million barrels per day, or 25 to 30 megatons a year) with very low-cost oil accounting for the rest. Most of that oil would be used in the petrochemicals industry to produce about 10 megatons per year of polymers.

That oil and gas would represent about 10 megatons of residual emissions annually; those emissions would be offset in full by projects using nature-based solutions (natural carbon sinks)

That oil and gas would also represent Scope 3 emissions totaling about 100 megatons annually. To get to net zero together with society, TotalEnergies would help eliminate the equivalent of 100 megatons a year of CO2 generated by our customers by developing:

• A carbon storage service for customers that would store 50 to 100 megatons a year of CO2
• An industrial e-fuels business that would prevent 25 to 50 million tons of CO2 for our customers

To become net zero by 2050, TotalEnergies aims to reduce by 100% the lifecycle carbon intensity, which is the average carbon intensity of energy products used by our customers worldwide (scope 1 + 2 + 3).

2030 worldwide targets (Scope 1+2):

• Reduce GHG emissions (Scope 1+2) from operated facilities from 46 Mt CO2e in 2015 to less than 38 Mt CO2e by 2025. By 2030, the target is a reduction of at least 40% of the net emissions (The calculation of net emissions takes into account negative emissions from natural sinks like forests, regenerative agriculture and wetlands) compared to 2015 for its operated activities, i.e., 25 Mt CO2e to 30 Mt CO2e.
• Improve by an average of 1% per year the energy efficiency of operated facilities since 2010.
• Reduce methane emissions (Excluding biogenic methane) from operated facilities by 50% between 2020 and 2025, and by 80% between 2020 and 2030.
• Maintain the intensity of methane emissions at less than 0.1% of commercial gas produced at operated gas.
• Reduce routine flaring (Routine flaring, as defined by the working group of the Global Gas Flaring Reduction program within the framework of the World Bank’s Zero Routine Flaring initiative) to less than 0.1 Mm3/d by 2025, with the goal of eliminating it by 2030.

Facts:

• A GHG emission reduction (Scope 1+2) from operated facilities from 46 Mt CO2e in 2015 to 40 Mt CO2e in 2022.
• 15% improvement in energy efficiency between 2010 and 2022.
• Methane emissions (excluding biogenic methane) already reduced by 50% between 2010 and 2020 and by 34% between 2020 and 2022.
• A methane intensity of less than 0.1% for operated gas facilities.
• More than 90% reduction in routine flaring between 2010 and 2022.

2030 worldwide targets (Scope 3):

• Maintain Scope 3 (GHG Protocol - Category 11) GHG emissions related to its customers' use of energy products to a level lower than 400 Mt CO2e by 2025 and 2030.
• Reduce Scope 3 (GHG Protocol - Category 11) GHG emissions from the petroleum products sold worldwide by more than 30% by 2025 compared to 2015. By 2030, the target is a reduction of at least 40%.

Facts:

• Scope 3 emissions limited to 389 Mt CO2e excluding the COVID-19 effect in 2022, below the 2015 level.
• A decrease of the Scope 3 GHG emissions from the petroleum products sold worldwide in 27% excluding the COVID-19 effect in 2022 compared to 2015.

2030 worldwide target (carbon intensity):

• Reduce the lifecycle carbon intensity of energy products used by customers by more than 25% compared to 2015; by 2025, the target reduction is at least 15% (Scope 1+2+3).

Facts:

• A decrease of the carbon intensity of energy products used by customers of 12% between 2015 and 2022.

Eligible and aligned capex represented more than 30% of the Company’s investment in 2022 in the proportional view – confirmation of the growth dynamic underway since 2020