Our view:

TotalEnergies' 2024 Strategy and Outlook day amplified the ongoing limitations in its transition plan. While its low-carbon build-out is head and shoulders above peers, its medium-term oil and gas growth strategy to FY30 continues to hold it back from securing the top spot of transition strategies.

The company now surpasses Eni with the most ambitious oil and gas growth guidance among peers, raising its target from 13% to 20% by FY30. Gas appears to play a larger role in its power generation by FY30, with its share rising to 30%, up from the previous 23%-27%. These shifts lower our forecast for TotalEnergies' net carbon intensity reduction to -21% by FY30, down from -24%. The company is targeting a 25% reduction between FY15-30.

Priority questions ahead of 2025:

01 Can TotalEnergies ensure its aggressive LNG growth won’t lock in long-term fossil fuel dependence? With plans to grow LNG sales by 50% by FY30, the most among Euromajors, LNG is framed as a decarbonisation lever, but its potential is limited. Clarity is needed on how these investments align with long-term decarbonisation.

02 Will TotalEnergies commit to quarterly reporting for its Low-carbon molecules business? Regular disclosures are required to track progress toward TotalEnergies’ target of allocating 33% of group capex to Low-carbon energies.

Key takeaways: