May 24, 2016 / 4:10 PM / 4 years ago

UPDATE 1-Total says strikes could jeopardise its investments in France

* CEO promised to invest, make refineries profitable by end-2016

* Plans to invest 600 mln euros in La Mede and Donges refineries

* Shutdowns could affect customer confidence -Total refining chief (Adds detail, quote from refining and chemicals chief)

PARIS, May 24 (Reuters) - French oil and gas company Total warned on Tuesday that strikes that have forced the shutdown of two of its refineries, with two more in the process of shutting down, could make it reconsider investments in its French plants.

The temporary shutdowns are the result of industrial action over France’s planned labour reforms, which have triggered weeks of street protests and risk paralysing the country with rolling strikes at refineries, ports and railways.

Total’s Chief Executive Patrick Pouyanne told journalists on the sidelines of the company’s shareholder meeting in Paris that the strikes were a breach of a pact reach with workers four years ago.

When Pouyanne took over as head of the oil major’s refining and chemicals unit in 2012, he promised to make the business profitable by the end of 2016 through heavy investment.

“This (strike) will lead us to seriously reconsider the investment plans we had for the various sites,” Pouyanne was quoted as saying by French business daily Les Echos on Tuesday.

Total, Europe’s largest refiner, operates five of eight refineries in France and nine oil depots.

Its Feyzin and Normandy refineries have shut down because of the ongoing strike, while operations at Donges and Grandpuits are in the process of shutting down.

Output at its La Mede refinery is at the lowest possible level to keep operations running and two of Total’s fuel depots were still being barricaded by striking workers on Tuesday, preventing fuel deliveries.

Total invested about 1 billion euros ($1.11 billion) in its Normandy refining and petrochemical complex between 2012 and 2014, with a further 200 million euros spent on its Carling petrochemical unit.

It said last year that it will invest 400 million euros to modernise the 220,000 barrels per day (bpd) Donges refinery to produce fuel for the European market and 200 million euros in the 153,000 bpd La Mede plant to transform it into France’s first biorefinery.

Both refineries are still loss-making.

In a letter to employees on Friday, the company’s current head of refining and chemicals, Phillippe Sauquet, warned of the potential impact of the ongoing industrial action.

“It constitutes taking our business hostage in a fight that is not ours,” he said in the letter, which was seen by Reuters.

“If we are not able to avoid such circumstances, leading to the shutdown of our units, it goes without saying that our customers would reconsider the confidence they have placed in us, and thus we should revise our future projects.” ($1 = 0.8971 euros)

Reporting by Bate Felix; Editing by David Goodman

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