PARIS (Reuters) - French oil and gas company Total announced the creation of a gas, renewables and power division on Tuesday, which it said will help drive its ambition to become a top renewables and electricity trading player within 20 years.
The new business division, to be led by a president with a seat on the company’s executive committee, will take effect from Sept. 1.
“Gas, Renewables and Power will spearhead Total’s ambitions in the electricity value chain by expanding in gas midstream and downstream, renewable energies and energy efficiency,” Total said in a statement.
The new organizational structure was presented by Chief Executive Officer Patrick Pouyanne to workers’ representatives at a works council meeting in Paris on Tuesday.
“The goal is to be in the top three global solar power companies, expand electricity trading and energy storage and be a leader in biofuels, especially in bio jet fuels,” Pouyanne said in the statement.
The Gas, Renewables and Power branch will be Total’s fourth business division. The others are Exploration and Production; Marketing and Services, and Refinery and Chemicals.
A spokeswoman said the plan outlined on Tuesday was not a strategic roadmap but the company’s ambition of where it wanted to be in 20 years. Total will present its strategic outlook to investors in September.
The company said last year that it plans to spend at least half a billion dollars annually in its renewable energies and aimed to increase the share of clean energies in its portfolio to between 15 to 20 percent by 2035, from 3 percent currently.
The spokeswoman said the company was responding to the shift in global energy demand from fossil fuels’ dependency to more energies from renewable sources to combat global warming.
“The idea behind it is that we will remain an oil and gas major with competitive oil assets that we can exploit with a low break-even point,” she said.
Total also said on Tuesday that it was creating a global services division which will pool some services including purchasing, information systems and human resources in an effort to cut costs in the current price downturn.
The reorganization will not result in any job cuts, it said.
Reporting by Bate Felix; Editing by Susan Fenton