After nearly 30 years of “prudent development”, various projects of the oil giant Total have quietly appeared in many regions in China, but Total feels that this is not enough.

In March 2013, CEO Marcello announced that negotiations with Sinopec for the development of shale gas have entered the final stage. After the identified block is approved, the resource assessment will be conducted. In early June, Total said that its solar panel manufacturer Sun Power will cooperate with three Chinese companies to build photovoltaic power plants in Inner Mongolia.

The industry speculated that there are two reasons for the news that Total has frequently communicated with China: First, due to the low gas price in the United States, it is difficult to make profits. Total announced that the shale gas investment target will be transferred to other countries, including China. Second, in the Q1 financial report announced on May 24, 2013, Total's net profit fell to 2.86 billion euros from 3.08 billion euros in the same period of last year, and its profit decreased by 7% year-on-year. CEO Ma Zheru said that the company will increase oil and gas production, and China is one of its targets.

However, as an emerging market for shale gas and photovoltaics, China has no shortage of entry and cooperation from large global companies. Total has been relying on technology to gain a foothold in new fields, especially in the Sino-European "double reverse" dispute has not yet settled At the moment, Total's path choices deserve attention.

Photovoltaic, slow behind

And Lingel, which means 20 houses in Mongolian. It used to be an important hub in central Inner Mongolia. However, as the political center moved southwards, in the last years of the Qing dynasty, Helinger’s permanent residents gradually migrated.

It is not only the current immigration wave in the late Qing Dynasty. Historically, people left and Lingaldo suffered from ethnic disputes and political changes. However, it cannot be denied that the climate, which is arid, windy, cold, and strong in sunshine, is not suitable for settlement but becomes The Sun subsidiary's Sun Power selected the favorable conditions for the first photovoltaic project.

Although media reports about this photovoltaic project mostly came from early June 2013, a speech made by the Marketing and Service Department of Total and the Director of the New Energy Department Bo Shushu in Paris, in fact, as early as August 2012, the partners of the project were I. Central Energy announced that it has announced that Total's Sun Power will cooperate with Central Energy, Inner Mongolia Electric Power and Hohhot Jinqiao Urban Construction Plan. According to the plan, this project will have a scale of 400 MW in 2011-2014, and will increase by 400 MW each year thereafter. The final scale will reach 2,000 MW.

By March 2013, Central Energy and Helinger County Government signed the "Framework Agreement", again clarifying the project construction time, project scale and promotion methods.

However, the preparation of the project took nearly one year. In mid-June 2013, the project was formally started, and news of the installation began in August.

The reason for this, and catching up with the large integration of the Chinese PV market, is an unavoidable point. In this context, Total has to cooperate with domestic enterprises to carry out downstream power station construction and promote sales of the company's photovoltaic modules. This should be a win-win good.

However, the problem is that Chinese PV companies facing “double opposition” have opened up markets in the country. Compared with the price of photovoltaic panels, the total technical advantages of Total may obviously put it at a disadvantage. According to media reports, Total Photovoltaic project uses the latest C7 condenser technology, that is, compared with ordinary solar panels, the technology can achieve 7 times the concentration of light. Although Total did not explain the cost of C7 technology, it can be inferred that this technology or cost is expensive.

If you dig up the recent news events of Total, you will find that if you go against the market to adopt high technology, or if you once again have a strategy of “high risk and high output”. In May 2013, the United States accused Total of bribing Iranian officials to win Iranian oil and gas contracts and imposed a fine of 398 million U.S. dollars. When the media lamented the fourth highest amount of fines in American history, Reuters pointed out that if this is the case, this is a kind of “high risk and high output” approach. Just as Marcelo said in a speech: "Because the situation is completely calm, it often misses the best investment opportunities."

The same principle also applies to the photovoltaic projects in Inner Mongolia. In a highly competitive and less booming market, Total dares to give a big fight. Although there are problems such as unclear policies and dire market prospects, once they have a firm footing, they can Stand out in a row of markets.

If the project is successfully started, another key issue related to profitability will be electricity consumption. According to the contract, this project will focus on local consumption, and will use more power to access the Internet. If the 800 megawatt project in 2015 is adopted, the annual minimum power will be at least 800 million kWh. From a small scale, Helinger's electricity demand is limited. Only the successful completion of the cloud computing base of the nearby Shengle Industrial Park will become its main channel of elimination. However, from a large scale, the problem of excess electricity in Inner Mongolia has so far been a problem. Existence, the ability to absorb in the area remains to be seen.

Shale gas, planning east

In the site of shale gas, Total's choice is also worth considering.

In Total's Sustainable Development Brochure 2011-2012, as early as the 1920s, Total conducted oil and gas exploration in the four regions of the Beibu Gulf, Bohai Bay, Yellow Sea and Tarim Basin. Although scattered, the four regions are not well-known resource-rich regions and are also recognized as potential resource sites. However, in March 2013, Total's first shale gas development area was declared to be west of Shanghai, where resources were rarely seen.

In fact, in the original shale gas exploitation plan, Sichuan, which is considered to be the richest area for shale gas in China, has entered Total's list. In 2009, Dai Jie, who was China's general representative at the time, said: "The Sichuan region, which is rich in natural gas and unconventional gas, will be one of the key locations for investment in the future."

However, shale gas development in Sichuan has always been questioned. In addition to difficult to determine reserves, unknown geological reasons, technology development, equipment, water level has not yet made progress. Therefore, choosing the eastern region can avoid the two major problems of shale gas development: First, the water source, the development of shale gas hydraulic fracturing requires a lot of water, in the currently recognized resource-rich zone, Sichuan is located in China's major water sources In the upper reaches, Inner Mongolia lacks water resources, while the eastern part occupies an absolute advantage in dense river networks and abundant water supply. Second, market channels, the western region has low energy demand and lack of pipeline infrastructure. If it can be developed in the east, shale gas products It can be sent directly to densely populated areas and recognized for its relatively low emissions.

Now, the most worrying issue for Total is policy. In May 2013, Nubeitang, general manager of Total China, said in an interview with the media that the key issue in the development of shale gas in China is that the relevant policies and regulations are not perfect.

This worry has the latest echo on June 7, 2013. At the China Unconventional Oil and Gas Conference held on that day, Bao Shujing, director of the Shale Gas Room at the China Petroleum Geological Survey Center, poured cold water on many companies: “In a professional cautious manner, the third round of shale gas exploration rights The tender will be held at the end of the year as soon as possible, or it may be stranded during the year.

In addition to the policy mechanism to be determined, another issue in the future will be environmental protection.

However, the environmental issues in China's projects may not be as simple as this. According to media analysis, what Marzell said may be referred to as southern Shanghai or northern Zhejiang. Both of these areas are densely populated areas in the eastern part of the country. The economy is developed but the land is tense, and the environmental capacity is extremely small. What's more important is that the residents here have a high general knowledge structure and they have concerns about environmental destruction and global warming. Therefore, the prospects for mining in the eastern region can be described as both joy and happiness.

From technology to tactics

For Total's goal in China, some people have tried to summarize: to establish a connection between the potential "oil point" and the Chinese market. Facts have proved that, with a good technical background and rich experience, Total has been able to establish a smooth connection during many years of contact.

However, people's impression of Total always stays on "technical control." However, in terms of the exploration and exploitation of conventional oil and gas, the domestic oil companies' level of technology and international standards are almost the same.

Returning to the field of photovoltaics and shale gas, the learning capabilities of domestic photovoltaic companies are obvious to all. It is precisely because of this that the price of photovoltaic equipment can be rapidly reduced, and it also triggers the unresolved and intensifying EU “double reaction”. As for shale gas, although it will take time to improve the level of technology, at the speed of Chinese companies, it is believed that once research and advancement are carried out and R&D is overweight, after three years and five years, the emergence of domestic mining technology in the world is unknown.

Total is obviously aware of these issues. If we say that the presentation of social responsibilities and the pursuit of license plates have always been a manifestation, then the trial of photovoltaic projects and the site selection of shale gas extraction are additional evidence. Not only for Total, but if international companies want to pursue longer-term development in China, it is not only the cooperation of a single upstream project, but it should be a breakthrough as close to the market as Total chose. There may be danger in this process, and once successful, it will be able to go further.

Total's confidence in environmental protection in shale gas extraction is full of confidence. “The use of hydraulic fracturing technology is much better than other small companies, and large companies are generally under the spotlight and are subject to many aspects of supervision.” Two promises can be verified from Total’s resolute absence of construction where it is not permitted by law, and the fact that Canada has suspended oil sands development for environmentalists.

The demand for electricity in Geer is limited. Only the successful completion of the cloud computing base in the nearby Shengle Industrial Park will become its main channel for consumption. However, from a large scale, the problem of excess electricity in Inner Mongolia still exists. Ability to be seen.