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OIL AND GAS P. 04 CLIMATE IMPACTS P. 10 ALTERNATIVE ENERGIES P. 16 SOCIAL RESPONSIBILITY P. 22 SAFETY P. 28 ETHICS P. 34 ENVIRONMENT P. 40 LOCAL DEVELOPMENT P.

46 MYANMAR P. 52 OIL SANDS P. 58

TEN QUESTIONS FOR TOTAL

ENVIRONMENT AND SOCIETY REPORT 2009

Our ability to understand the expectations we create and to meet them head on should help us.
Christophe de Margerie

Message from Christophe de Margerie Chief Executive Ofcer(1), Total

evelopment, rising demand for energy and climate change: what we do lies at the intersection of two of the greatest challenges facing the world today and tomorrow energy supply and environmental protection. Our responsibility as an energy producer is to manage these crucial and apparently conicting challenges as best we can. In practical terms, that means managing our energy use and offering our customers ways to do the same. More importantly, it also means inventing a new energy model that combines fossil fuels with low-carbon energy sources, to satisfy energy demand without interruption while at the same time protecting the environment.

Our activities, our size and our nancial strength understandably raise high expectations, in areas as various as employment, the environment, local development, safety, access to energy, nancial transparency, ethics and more. We must acknowledge and take heed of these expectations. Doing so is a moral and civic duty and, more prosaically, an industrial and business one. The energy environment is changing. Producing countries are increasingly reluctant to grant access to their reserves and competition among oil operators is intensifying as newcomers from major emerging economies ramp up their activities, among other developments. That means we have to stand out from everyone else to continue enjoying access to resources, which is whats needed to generate sufcient earnings to keep boosting our capital expenditure, especially on R&D. This is the only way for us to secure the future of energy and tackle climate change. In other words, a key determinant will be our ability to listen, explain and take into account in short, to have transparent, constructive conversations with our stakeholders. That is, everyone directly and indirectly concerned by our projects, including employees, neighbors, customers, authorities, associations and shareholders. The human factor is critical to this conversation. Through our personal conduct and people skills, we can lay the groundwork for balanced relationships, convince producing countries and their national oil companies that we add value, and in general demonstrate, in every host country, that our projects stimulate economies while respecting peoples rights and protecting the environment.

Energy supply and environmental protection our responsibility as an energy producer is to manage these crucial and apparently conicting challenges as best we can.

But our responsibility doesnt end there. With nearly 97,000 employees, a presence in every region of the world and large-scale, value-creating projects, we rank among the top 20 enterprises worldwide.

(1) Christophe de Margerie is expected to be elected Chairman of the Board of Directors following the Annual Shareholders Meeting on May 21, 2010.

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Message from Christophe de Margerie Chief Executive Ofcer, Total

Yet this is no easy task: we must deal with a growing number of stakeholders and the sometimes-conicting requirements that go with them. At times we have to make tough decisions. Im thinking in particular of the changes at our Flandres renery in northern France. Im also thinking of our investments in oil sands projects in Canada, which we believe are vital for meeting energy demand over the next few decades. However, assuming our responsibilities also means understanding why people criticize both our decisions and our projects. In the case of the Flandres renery, we have made a commitment not to lay anyone off. We have also pledged that, aside from the changes planned at Flandres, we will not shut down or sell off any French reneries in the next ve years.

In Canada, we are bringing all our knowledge and expertise to bear to nd technologies that will shrink the environmental footprint of our oil sands projects. This is one of the reasons why we have opened a research center dedicated to the same issues in Calgary and are working closely with institutional, scientic and industrial partners. We are aware that we still need to improve further. Listening, discussing and opening our minds to other ways of seeing and doing things are effective ways to move forward. It is because we rmly believe they are that we have put together this report. By answering your questions about some of our chosen directions, we hope to show you what it is we do and where we mean to go. But even more than that, we want to open up the dialogue, invite you to ask us questions and tell us about your expectations and what you dont understand. In short, to help us do better. Because the world is changing and we have to change with it, before it, in our interest and everyone elses. We hope you enjoy our report.

However, assuming our responsibilities also means understanding why people criticize both our decisions and our projects.

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OUR ACTIVITIES

SERVING OUR STAKEHOLDERS

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Q01

How can Total satisfy rapidly growing energy needs despite rising carbon constraints? Can the business model adapt to carbon at 25, 75 and 100 per ton?
VICKI BAKHSHI

Associate Director, Governance & Sustainable Investment team, F&C Investments, a European fund manager

Oil and Gas

Answer: Energy demand is tied to economic development and will continue to grow. All types of energy will be needed to meet this demand. But oil and gas will still dominate in the coming decades. That will require substantial investment. Our roadmap for this collective challenge involves meeting this demand while tackling climate change and promoting development, in particular for the most disadvantaged. We have set very specic objectives to reduce our climate impact. A large percentage of our R&D spending is focused on energy efciency and carbon capture and storage. All our projects integrate carbon cost and our business model takes into account increases in this cost. But we feel it is essential that the cost be borne fairly by all stakeholders, without distorting competition at the global level. Thats why we want to see a fair, global agreement on climate in the coming years.

2.3

million

barrels of oil equivalent per day: Totals oil and gas production in 2009.

0.5

tons

of carbon equivalent: average industry emissions per barrel of oil, of which some 85% from end use and around 15% from production and rening.

33.5%

percentage of greenhouse gas emissions related to oil and gas, of which around 85% during product use.

15%

reduction in our direct greenhouse gas emissions from operated activities in 2015 from 2008 as a result of ongoing initiatives.

Our objectives and business principles


Continue to invest substantially $14 billion planned in 2010 to meet future energy demand. Take into account and manage all human, environmental and community issues and impacts across the project life cycle. Achieve operational excellence without sacricing environmental performance. Strengthen our partnerships with producing countries and national oil companies. Discover and develop new high-tech resources. Consolidate the expected return of new projects by optimizing development plans and managing their costs. Optimize the operation of our elds, including the most mature. Factor carbon costs into our investment decisions and at all project stages.

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Continuing to invest to meet future needs


Because the elds we develop today will supply the production the world will need tomorrow, we are maintaining a high level of capital expenditure, as shown by the $1.8 billion dollars we will spend on exploration in 2010.
FOSSIL FUELS WILL REMAIN AN ESSENTIAL PART OF THE ENERGY MIX IN 2030
The need to tackle climate change and the inherently non-renewable nature of fossil fuel resources require us all to do our share to use energy more efciently and diversify sources, at every level. We are doing our part. We are improving the energy efciency of our oil and gas production facilities and petrochemical plants by 2% a year. By 2014, we intend to reduce our aring of associated gas by 50% from 2005 levels. These actions are expected to cut direct emissions in our operated scope by 15% in the period 2008-2015. And the scale of competencies, especially in geosciences, makes us a leader in the ranks of those advancing carbon capture and storage technology(1). However, forecasts such as the International Energy Agencys (IEA) 500 ppm(2) scenario, which incorporates a signicant carbon requirement, agree that fossil fuels will still account for about 75% of the energy supply in 2030 (30% for oil and 22% for gas), compared with 81% in 2005.

DEMAND DRIVEN PRIMARILY BY EMERGING ECONOMIES


The recession caused global demand to plunge and it accelerated the structural decline in demand in developed countries, especially in Europe and North America. Yet there are still immense needs to be met, particularly in large countries such as China, India and Brazil. Non-OECD countries will be home to nearly 85% of the worlds population within 30 years. Added to rising living standards, this demographic reality means that the countries concerned will account for more than 80% of the growth in energy demand over the same period. So the recession has not signicantly altered our long-term vision. Driven by emerging economies and their power generation and transportation needs, demand is expected to start climbing steadily again. Yet oil production capacity could top out at around 95 million barrels per day by 2020 due to naturally declining output from elds, the rarity of major nds, harder-to-access new reserves that involve greater technological challenges, and fewer projects launched during the downturn. And that structural factor could restore the strong upward pressure on energy prices.

An investment strategy guided by a commitment to corporate responsibility


Every investment proposal submitted to Totals Executive Committee, whether involving a new project, developing a new field or a planned expansion or acquisition, is first assessed in detail using a multi-criteria risk analysis grid. The goal is to ensure compliance with our safety, security, health and hygiene, community development and environmental standards, across the project life cycle. Current and forecast carbon costs are among the criteria that determine our investment decisions.

Pazor is a gigantic industrial jigsaw puzzle whose pieces have been manufactured locally in Angola, but also in South Korea and Norway, like this subsea separation unit.

(1) See page 15. (2) Parts per million, the reference unit used to measure the concentration of greenhouse gas in the atmosphere.

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Oil and Gas

Consolidating our positions in every growth segment


Ultra-deepwater developments, tight and deeply buried reservoirs, high-temperature/high-pressure resources, heavy oil, sour gas, shale gas and shale oil here is where our knowledge and skills can make a difference, developing the resources of tomorrow while minimizing their environmental impact.
A BALANCED, DIVERSIFIED PORTFOLIO OF PROJECTS
In recent years, we have expanded our acreage in growth areas, such as North America, Russia and Australia. In 2009, we strengthened our positions in the elds of the future, in particular unconventional gas. The ten building block projects that will come on stream between 2010 and 2014 testify to our emphasis on striking a geographic balance between OECD and non-OECD countries and a technological balance between conventional and unconventional resources.

integrated projects we manage, on time and at best cost, in accordance with our performance quality requirements. These strengths will also be decisive in the future, positioning us to work on increasingly complex developments that are subject to ever-stricter safety and environmental requirements, such as in the extreme conditions of the Caspian Sea or Russian Arctic.

STAYING ON THE CUTTING EDGE IN THE DEEP OFFSHORE


In 2009, we further exhibited our excellence in deepwater operations, notably with the coming on stream of Akpo in Nigeria, the culmination of the efforts of 10,000 people from around the world. In Angola, when Pazor begins production in 2011, Total will become that countrys top international operator. And studies continue to develop new elds. We are a global leader in terms of number of deepwater wells operated. Agreements entered into in 2009 with the U.S. company Cobalt, a successful Gulf of Mexico exploration specialist, augment both our portfolio and our knowledge of the area, which combines the challenges of the deep offshore and deeply buried reservoirs.

EXPLORING NEW FRONTIERS


In 2009, we also became more involved in unconventional oil and gas. Already active for many years in the extraction of heavy oil in Venezuela, we are expanding our oil sands operations. In Canada, Phase 2 of the Surmont project, a 50/50 joint venture between operator ConocoPhillips

LEVERAGING RECOGNIZED LEADERSHIP IN MANAGING MAJOR INTEGRATED PROJECTS


We have proven our ability to deploy the human, nancial and technological resources required to deliver the major

The Yemen LNG gas liquefaction plant.

Leader of the Yemen LNG project and partner in Qatargas 2, two plants that came on stream in 2009, Total will become the worlds second-ranked liquefied natural gas producer in 2010. We are committed to an ambitious LNG strategy warranted by the need to meet long-term demand. We are strengthening our presence across the value chain, from liquefaction and shipping to regasification and marketing.

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and Total (see page 60), is now under way. In Madagascar, the Bemolanga eld is currently being appraised. The acquisition of an interest in U.S. company Chesapeakes assets in late 2009 brings Total new skills and knowledge in shale gas, while our stakes in Algerias Timimoun and Ahnet licenses will add to our experience with tight gas reservoirs, gained at several sites, including Aguada-Pichana in Argentina.

Earning the trust of our partners


Access to the resources of the future depends on our ability to forge mutually benecial relationships with host countries and national oil companies, through providing and transferring expertise, supporting local development and managing our impacts.
FORGING AND NURTURING VERY LONG-TERM PARTNERSHIPS
Total has operated for decades in Indonesia, Angola and Abu Dhabi, to name just a few countries. We have forged bonds of trust there with authorities, industrial partners and our stakeholders. By understanding local challenges, focusing on the development of capabilities and limiting the negative impacts of our operations, we solidify our local roots a little more each day, a prerequisite for sustainable, shared growth. Total has been present in Indonesia since the 1960s and has been its biggest gas producer for ten years. Nonetheless, our employees are also helping the national authorities manage the countrys transition to a more diversied energy mix, by leveraging its enormous solar and geothermal potential. In 2009, we celebrated 35 years of production from Abu Al Bukhoosh (ABK). There, eld decline has been delayed by the use of enhanced recovery techniques. It has been transformed into a thriving oil and gas hub by tying it into

MEETING THE TWIN CHALLENGES OF ENERGY SUPPLY AND ENVIRONMENTAL PROTECTION


Our industry is continually remaking itself, developing new technologies to meet growing demand. There are still enormous quantities of oil and gas to be found. Increasingly difcult to unlock, their development will also be affected by the expected increase in carbon cost. We have anticipated this, but it raises another issue, that of how end users will respond to more expensive energy in the future. That said, producing these tougher to develop elds will require not only major capital expenditure, highly capable people and world-class R&D, but also community development skills and an unparalleled commitment to mitigating environmental impacts. Our business model and our concept of responsibility and what a company like Total should offer perfectly t the bill. Our growing involvement in tapping the value of various gas resources is aligned with this strategy. Natural gas has a lower climate impact than coal and is a particularly attractive alternative for power generation, until other energy sources come of age.

Unconventional oil and gas: key potential resources to meet future demand

Oil resources
~ 3 ,000Bboe* 100 years 70 years 50 years 33 years of production at current rate

Gas resources

Unconventional resources Oil shale shale gas, coal bed methane, tight gas Oil sands New discoveries and increased recovery rate Identied resources Already produced

~ 2,000Bboe* 120 years 90 years 55 years of production at current rate

* Billion barrels of oil equivalent.

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Oil and Gas

other elds. A partner of six of national oil company ADNOCs 14 subsidiaries, we also actively train young U.A.E. operators in cooperation with local universities. In another example, we are broadening our collaboration

with Qatar across the gas value chain, from production through liquefaction, as well as in the petrochemical eld.

Two questions for

BERNARD SEILLER Vice President, R&D, Total Exploration & Production Why is increasing recovery rates strategic to meet demand? The recovery rate for an oil eld averages about 32%, but ranges widely, from around 8% for certain extra-heavy oils to some 70% in North Sea elds. A 1% increase in the recovery rate on a planetary scale would yield another 60 billion barrels, or two years of global consumption at

current rates. To meet this challenge, Total deploys an arsenal of techniques. For example, since 2009, after ve years of research, we have been conducting the rst-ever tests of deep offshore polymer injection, in the Dalia reservoirs in Angola. Extending the use of this chemical process to the entire eld, planned for 2014, is expected to boost reserves recovery by about 5% over 20 years. How do you identify the resources of the future quickly and accurately? We are continuing, of course, to work on new geophysical algorithms and new geological concepts. But its just as important to increase synergies among our geosciences capabilities geology,

geophysics, reservoir engineering and geoinformation. To help us better discern the outlines of oil plays, build more robust, consistent models, reduce uncertainties and automate repetitive tasks, we are currently building an integrated modeling chain that is a precursor of the simulator of the future. R&D also plays a key role in responsibly developing unconventional resources. Shale oil, which consists of solid oil trapped in impermeable rock, is one of the oil industrys next frontiers. Through our interest in American Shale Oil (AMSO), we have since 2009 participated in a research and demonstration program to make shale oil production feasible within the next 20 years. Slated to be up and running in

2011, the pilot in the U.S. state of Colorado will ne-tune the technologies now being considered, mainly in terms of energy efciency and environmental friendliness. The list includes bottomhole retorting, in-ground carbon mineralization and the close monitoring of aquifers in the area.

Eleven million hours worked in Nigeria, out of a total of 32 million, to bring the Akpo field on stream in 2009. We once again demonstrated our commitment to supporting local businesses when developing Akpo, the latest deepwater giant in the Gulf of Guinea. Our next projects in Nigeria, Usan and Egina, will boost local content still further.

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Q02
How will Total take a leading role and thrive in a zero-emission economy?
PAAL J. FRISVOLD

Chairman of the Board, Bellona Europa, an NGO specialized in energy and climate change

Climate Impacts

Answer: The climate change challenge requires more intelligent, more frugal use of energy resources and substantial spending on innovative technologies. The rise of a low-carbon economy will also create growth opportunities, for us included. But the International Energy Agencys best forecasts show that even if the international community manages to agree on a very aggressive policy of greenhouse gas mitigation, oil and gas will continue to dominate for at least the next two decades, especially in specic applications such as fuels. Were therefore stepping up our efforts to optimize our processes, offer more environmentally neutral products and services, and expand our energy solutions to include new, low-carbon sources. We are also helping to develop carbon capture and storage processes, which will play a pivotal role in containing carbon emissions from industry and power plants. However, it will be many years before they are widely deployed.

55

million

metric tons of carbon equivalent: Totals direct emissions worldwide in 2009.

50%

reduction in 2014 from 2005: our target for emissions associated with gas aring in our exploration and production operations.

gigajoules of primary energy consumed in 2009, down 5.4% from 2008.

608

million

Our objectives and business principles


Continue to reduce aring of associated gas by developing it locally, converting it to liqueed natural gas, reinjecting it into elds and other solutions. Continue to optimize the energy efciency of our facilities, by leaving our targets unchanged for the period 2007-2012: a 1% reduction annually in Rening and a 2% reduction annually in Exploration & Production and Petrochemicals. Help our customers to save energy and reduce their fossil fuel use and environmental footprint by offering them an ever-wider array of efcient products and services. Do even more to help deploy key technologies for tackling climate change, such as carbon capture and storage. Offer more low-carbon energy solutions, by building up our positions in solar energy, nuclear power and non-food crop biomass-to-energy processes (see pages 16 to 21).

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Deploying a comprehensive strategy


Total contributes to a necessary worldwide effort to tackle climate change through daily actions at our sites and with our customers and by devising critical medium and long-term solutions.
Global greenhouse gas emissions from human activity total about 50 billion metric tons of carbon equivalent annually, of which 60% is attributable to the energy sector. Oil and gas-related emissions account for 33.5% of global carbon emissions. The use of petroleum products generates six times as many emissions as oil and gas production and rening operations. The gure for Total in 2009 was 55 million metric tons of carbon equivalent for operations. We are using every possible means at our disposal to help curb greenhouse gas emissions. Our climate change strategy consists of making our facilities more energy efcient, developing processes that are less energy intensive, investing in carbon capture and storage (CCS) technology and alternative energies, and providing innovative products and services that allow our customers to curb their energy consumption by using fewer resources, more efciently.

SIGNIFICANT IMPROVEMENTS AND A COMMITMENT TO DO EVEN BETTER


We already pared our emissions by more than 4% between 2000 and 2009, a decade that saw our operated oil and gas production jump signicantly. Our fertilizer plants have slashed emissions nearly 27% since 2007, with a reduction of 500,000 metric tons of carbon dioxide equivalent in 2009, just by cutting nitrous oxide emissions. Our efforts continue. Totals combined initiatives are projected to cut our direct greenhouse gas emissions from operated activities in 2015 by roughly 15% from 2008 levels, on a like-for-like basis. At the same time, we are optimizing our emissions reporting, which is audited by outside rms and published transparently.

AN EFFORT TO BE SHARED BY ALL STAKEHOLDERS


Total advocates clear, global, gradual regulations to reduce greenhouse gas emissions. Global, because greenhouse gases are a planetary problem; clear, because all businesses need visibility; and gradual, because people need time to adjust. Despite major strides, the Copenhagen Summit in late 2009 did not produce any indication that agreement would be reached in the medium term. Because over half of our emissions are generated by facilities in the European Union, we must plan ahead for the reduction requirements of Phase 3 of the E.U.s carbon trading market.

Greenhouse gas emissions by source


17%
Deforestation

Greenhouse gas emissions by type of resource


kg C/boe*

14%
Agriculture

13%
Transportation

85% Product
use

600 500 400 300 200

12.5%
Other GHGs, other

8%
Building

33.5%
Oil and gas worldwide

7.5% 23%
Coal

5%

Industry

Production and Rening

15% Production
and rening

100

0 Oil sands Deep offshore Conventional crude oil


* Kilogram of carbon per barrel of oil equivalent.

Source: 2004 gures, IPCC and IEA 2007 publications.

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Climate Impacts

In our opinion, environmental taxes need to be discussed jointly by governments, so that they can incentivize changes in behavior without distorting competition.

all of our partners, meaning this target cannot be met before 2014.

Reducing gas aring


Flaring of associated gas from oil production needs to be scaled back for two reasons: to capture a valuable energy resource whenever possible and to mitigate its environmental and climate impact.
Flaring accounts for 29% of our direct greenhouse gas emissions. It is sometimes temporarily unavoidable, for safety reasons, when a malfunction occurs or during maintenance. On the other hand, in 2000 we decided not to undertake any new developments involving continuous aring. We have followed this guideline in planning all recent projects, such as Akpo, which came on stream in Nigeria in 2009, and Pazor, now under construction in Angola. Since 2006, we have also been scaling back aring at our existing facilities. This consists mainly of installing new equipment and improving the reliability of gas compression and reinjection systems, as we did recently on the ABK eld in Abu Dhabi and the Nkossa eld in the Congo. As a member of Global Gas Flaring Reduction (GGFR) public-private partnership created in 2001 by the World Bank, we are determined to honor our commitment to halve aring at operated sites from 2005 levels. However, these capital-intensive projects require the agreement of

MAKING THE RIGHT CHOICE FOR THE LOCAL SITUATION


We are focusing on three main areas in our attempt to reduce aring: nding local, especially industrial, markets for the gas; converting it to liqueed natural gas (LNG); and reinjecting surplus gas into elds when site congurations allow, to also increase the oil recovery rate. On the Amenam offshore eld in Nigeria, for example, a third of the gas is reinjected and the remainder is exported to the Nigeria LNG plant on Bonny Island.

Using energy more efciently


Improving energy efciency requires action at every level, including industrial processes, power generation, transportation, construction, and less energy-intensive products and services. We are working on all these areas at once.
Although Total is an energy supplier, we also use large amounts of energy 608 million gigajoules in 2009. We therefore coordinate our approach to energy efciency, to pool best practices and ideas for innovation. Exploration & Production aims to improve the energy performance of its facilities by 2% a year over the

Greenhouse gas emissions from Total-operated sites worldwide: 55 million metric tons per year of carbon equivalent
4% 11%
Chemicals Other

17%
Processes

6% 3% CH ** 4
N2O*

29%
Flaring

40%
Downstream

49%
Upstream

50%
Combustion

91%
CO2

By business

By source

By type of gas
* Nitrous oxide. ** Methane.

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period 2007-2012. Since 2007, site and subsidiary action plans have been guided by energy balances. In 2009, E&P prepared technical guides that will add to the tools available to petroleum architects, technology specialists and operators. Another initiative compared seven oating production, storage and ofoading vessels (FPSO) in production or design, highlighting the most critical choices, including turbine type, heat recovery and uid separation, in order to optimize future developments. Similar studies are looking at sour gas elds and gas liquefaction plants. Petrochemicals is on track to boost the energy efciency of its operations 2% a year to 2012. The styrene unit in Gonfreville, France, was upgraded, making it the worlds most energy efcient. Several other major projects were initiated in 2009, including cogeneration in Feluy, Belgium; new furnaces and boiler retrots in Gonfreville; and a more efcient steam turbine in Antwerp, Belgium. And Petrochemicals is preparing for the post-2013 era, to further reduce the energy used in its operations. Rening teams are not to be outdone. Energy use accounts for nearly 60% of the business operating costs. A comprehensive plan is being deployed, involving unit optimization, furnace upgrading and steam loss reduction, to trim energy use by 1% annually at all European reneries to 2012. The projects under way installation of a Packinox heat exchanger, optimizing heat recovery in a distillation unit will improve energy efciency by anywhere from 0.8 to 3 percentage points at sites, depending on what is being done.

HELPING OUR CUSTOMERS SHRINK THEIR ENVIRONMENTAL FOOTPRINT


Using fewer resources, cutting carbon and other pollutant emissions and creating less waste are all ways to shrink our customers environmental footprint, a goal that drives our continuous improvement process. Each year, our efforts yield new solutions for our major markets, namely transportation and mobility, construction, heating, and industry. Launched in 2009, the Total Ecosolutions program(1) provides some extra push. The program now encompasses a dozen certied products and services plastics, adhesives, engine oils, combined heating oil-solar energy solutions marketed in France and Europe. Compared to the reference products and services available in the market, they avoid a combined total of 500,000 metric tons of carbon emissions annually, an amount equivalent to the emissions of 160,000 cars. Our goal is to gradually expand this range of solutions. Based on internal cross-fertilization and dialogue with our external stakeholders, our approach leverages expertise in the elds of strategy, marketing, R&D and sustainable development.

In 2009, we further expanded our line of fuel economy lubricants, now the most complete in the market. The lines car engine oils improve fuel efciency by at least 2.5%.

Total Petrochemicals Lumicene allows our customers to develop significantly improved products in their own markets. The Lumicene range includes polyethylene resins for film, rotational molding, blow molding, artificial turf, and caps and closures, as well as polypropylene grades for fibers, film, injection molding and medication applications. These higher-density polymers require less feedstock to produce and offer a better greenhouse gas balance.

(1) See our dedicated Web page: http://www.total.com/en/environment--society/meeting-energy-demand/products-and-services/total-ecosolutions-200593.html.

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Climate Impacts

Helping to advance carbon capture and storage


According to the Intergovernmental Panel on Climate Change (IPCC), carbon capture and storage (CCS) could reduce energy-related carbon dioxide emissions by a third between now and 2050. Total is a pioneer in these promising technologies.
Using various processes, CCS could potentially be utilized at 7,000 industrial facilities worldwide, including thermal power plants, steel plants, cement factories, reneries and petrochemical plants. It could also make a decisive future difference in the responsible production of sour gas and extra-heavy oil. In operation since January 2010, the Lacq industrial pilot in France exemplies the way Total has embraced CCS. Our teams assembled existing technical building blocks and also broke new ground in several areas for the project. It is one of only two in the world out of some 150 in all to span the entire chain, from natural gas extraction, treatment and combustion to carbon collection, transportation and storage at a depth of more than 4,000 meters in a depleted gas eld. It is a rst in Europe. In 2010 and 2011, the Lacq demonstration project is expected to capture and trap 120,000 metric tons of carbon. Broad-based discussion and consensus building took place before it came on stream, and monitoring

procedures were set up under the scrutiny of independent experts to assess results and impacts.

OFFERING OUR SKILLS AND EXPERTISE TO THE ENTIRE INDUSTRY


There are three main methods of carbon capture: post-combustion, pre-combustion and oxy-fuel combustion. In Lacq, we opted for the third. Oxy-fuel combustion replaces air with pure oxygen in the boilers that produce steam and electricity. We chose it because the fumes at the end of the process are highly concentrated in carbon, facilitating capture. It also holds the promise of high energy efciency in the long term, could be duplicated on a large scale, and is especially well-suited to existing facilities in a number of sectors. A partner of a number of projects around the world, Total has more than ten years of CCS feedback and experience. We are exploring all options to help spur the commercial deployment of the most efcient and sustainable options. We are already considering using CCS in our oil sands projects in Canada, at LNG plants and in sour gas developments such as Bongkot in Thailand and Ichthys in Australia. We are also coordinating the France Nord project, as part of a partnership of public stakeholders, businesses and research organizations. It aims to identify safe storage sites in the Paris regions deep saline aquifers, able to hold a signicant amount of emissions from highly industrialized areas.

GEOLOGICAL STORAGE OPTIONS FOR CARBON

Source: IPCC.

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Q03

The future belongs to renewable energies. Is that true at Total too?


KATHERINA REICHE

Parliamentary State Secretary to the German Minister for the Environment, Nature Conservation and Nuclear Safety

Alternative Energies

Answer: Were securing the future of energy here and now. Renewable energies encompass a wide array of resources that will be able to meet varied demand. We want to leverage our expertise to promote their development. However, these resources will only be able to meet a tiny fraction of global demand in 2030. Thats why, alongside our solar energy and biomass activities, we are also exploring nuclear power generation. These focuses reect our determination to increase the supply of non-carbon-emitting energy, through fully mastered commercial processes, to meet growing energy demand worldwide.

X2

increase in our subsidiary Photovoltechs total photovoltaic cell production capacity in 2010.

major research partnerships at end-2009.

capacity of Abu Dhabis planned world-class concentrating solar power plant. Total (20%) and partners Abengoa (20%) and Masdar (60%) submitted the lowest bid.

110 MW

Our objectives and priority actions


Solar energy: step up our industrial involvement and acquire expertise in all solar-related technologies, to develop innovative, more efficient, cost-competitive products for customers, by building on sustainable research initiatives and closely coordinated research and commercial development, and by leveraging synergies with our specialty chemicals businesses. Nuclear power: get started on a gradual buildup so that we can eventually operate plants, by utilizing our investment capabilities and expertise in managing complex projects, by leveraging our ability to take local situations into account, and by partnering with the most reputable players to master the issues specic to the industry, such as safety, security and non-proliferation. Biomass: help identify the most efficient conversion processes offering the best performance in terms of financial, environmental and community impact, with very broad potential applications, from automotive and other fuels to green chemicals. Continue to invest in other avenues we consider promising, such as hydrogen fuel and marine energy. Maintain proprietary technology watch and invest venture capital to support small businesses through the acquisition of minority interests.

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A solid commitment to solar energy


We are cementing our expertise in all types of solar energy technology so that we can offer ever more innovative, efcient, cost-competitive products that are suitable for a variety of applications.
Solar energy is abundant and available worldwide, generates almost no carbon emissions and lends itself to a number of applications, including power grids, home use and telecommunications. According to the International Energy Agency in its World Energy Outlook 2009, it could supply more than 400 TWh(1) of the worlds electricity in 2030.

manufacture, installation and operation of photovoltaic modules and systems. Between 1983 and 2009, Tenesol installed more than 3 million square meters of panels worldwide. It operates two plants, one in Cape Town, South Africa, and the other in Toulouse, France, which recently tripled its capacity.

OPERATING ACROSS THE CHAIN AND STANDING OUT THROUGH INNOVATION


We intend to become more integrated at the upstream end of the process silicon purication and wafer manufacture and strengthen our presence across the value chain. At the same time, we are stepping up our R&D efforts to accelerate cost reduction, boost the conversion efciency of current and future components, and expand the number of uses and ways to integrate solar energy systems into buildings. We signed several agreements in support of those goals in 2009. One was with the world-leading independent research center Interuniversity MicroElectronics Center (IMEC) in Belgium, to decrease the amount of silicon needed for rst-generation cells and improve their efciency. Another was with Laboratoire de Physique des Interfaces et des Couches Minces (LPICM), a joint research facility of the French National Center for Scientic Research (CNRS) and the cole Polytechnique engineering school in France, to create a joint team, christened NanoPV, dedicated to thin lms. In both cases, we hired researchers who were then seconded to the laboratories. As the biggest shareholder in Konarka, we are working with

MAKING THE DEVELOPMENT OF PHOTOVOLTAIC SOLAR ENERGY A PRIORITY


Total has years of industrial experience in photovoltaic solar technology. In 2010, Photovoltech, a 50/50 joint subsidiary of Total and GDF Suez, will reach a production capacity of 155 MWp(2) of crystalline silicon photovoltaic (PV) cells, currently the dominant technology. The two shareholders support the growth of Photovoltech, which has strong potential. Tenesol, a joint venture between Total and French electric utility EDF, is positioning itself downstream as a supplier of end-to-end solutions spanning the design,

How Total sees the energy mix in 2030


Mboe/d*

It will take the combined use of all types of energy to sustainably meet varied demand in 2030. We do not believe in a single, ideal, universal energy mix. But we are doing our part to nurture a necessary transition that will require more frugal, intelligent, flexible use of energy, starting now.

400

300

200

100

Fossil fuels (81%)

Fossil fuels (75%)

Solar, wind, other renewables Hydroelectricity Biomass excluding biofuels Biofuels Nuclear power Coal Natural gas Oil

2005

2030
Source: Total estimates.

* Million barrels of oil equivalent per day.

(1) Terawatt-hours. (2) Megawatt-peak: 1 million peak watts. A peak watt, the unit used to rate the performance of photovoltaic panels, will deliver 1 watt of electricity under standard conditions of 1,000 W of light intensity per square meter and an ambient temperature of 25C.

18 / Environment and Society Report 2009

Alternative Energies

the U.S. company to develop polymer-based lms for plastic solar cells, a third-generation photovoltaic solar technology. In this segment, as in others, we are leveraging our skills and expertise in carbon chemistry and specialty chemicals. Our subsidiary Sartomer is working with Konarka on adhesives to lengthen the life of panels.

Becoming a nuclear operator to be reckoned with in the future


It is our ambition to invest in the nuclear power industry for the long-term and acquire the skills and expertise needed to operate nuclear power plants.
Mature technologies, years of learning from experience, the virtual absence of greenhouse gas emissions, the ability to generate large amounts of electricity without interruption, and the need to replace many end-of-life reactors are just some of the reasons for our move into nuclear power, an essential component of tomorrows energy mix.

concerns of all stakeholders in the areas of safety, security, radiological protection, environmental protection and proliferation. We have many assets we can leverage to achieve this. We have demonstrated our ability to design and operate very complex, capital-intensive units. In our core businesses, we think in terms of timeframes that span decades, as in the nuclear power industry. And we know how to satisfy the aspirations of our many host countries by developing their national energy potential and local talents. In May 2009, we acquired an 8.33% interest, alongside French electric utility EDF and GDF Suez, in the Penly European Pressurized Reactor (EPR) project in France, for which public hearings will be held in the rst half of 2010. We are also examining other opportunities in our host countries, in partnership with experienced operators recognized in France.

LEVERAGING OUR ASSETS FOR A GRADUAL BUILDUP


As a newcomer to the nuclear industry, we are partnering with major operators to acquire the skills and expertise we need to operate power plants while addressing the

Storing solar energy more cheaply


Solar energy is intermittent. To allow the broadest possible use, efficient solutions are required to store this energy and ensure it is available when needed. A five-year, $4-million contract signed with the Massachusetts Institute of Technology (MIT) in 2009 will help its researchers develop a highly efficient, low-cost, long-life battery. The market for such a battery could reach $100 billion by 2030.

The photovoltaic solar panels installed in Lacq and Pau, France, in 2009 reect our commitment to promoting the diversity of solar solutions at our facilities. Taken together, the various projects represent a total investment of 15 million through end-2010.

TOTAL / 19

Helping to choose the best biomass options


It will take time and substantial investment to transition to wider-scale use of biomass. However, we are applying skills and expertise from all of our disciplines to help identify the most efcient, sustainable ways to convert biomass to energy.
We are drawing on our experience with rst-generation biofuels, which will continue to dominate through 2020, to plan ahead for regulatory changes. European Union regulations on transportation fuels call for raising their energy content from renewable and sustainable resources to 10%. With that in mind, we are diversifying our sources of supply. A unit to produce biodiesel by hydrotreating vegetable oils began operating at the Donges renery in 2009. It could eventually use other types of feedstock, such as animal fat and used cooking oil.

BROADENING THE RANGE OF POSSIBILITIES


We are exploring a number of avenues for converting biomass to energy. Each is specic to the resource used (type, location, harvesting and transportation), the conversion processes utilized, and the type of molecules and markets targeted. We are a partner in the Futurol project to develop a process to produce ethanol from lignocellulose the non-edible portion of plants and are aiming for

commercial production in 2016. We are also developing thermochemical conversion through our participation in the BioTfueL project, based on processes that combine feedstock gasication with synthesis reactions. The project is designed to validate the feasibility of producing advanced biodiesel from lignocellulosic biomass and fossil fuel resources. We are also involved in promoting dimethyl ether (DME), a clean gas that can be used as a vehicle fuel and a petrochemical feedstock. We are a member of a consortium that began testing bio-DME made from pulp residue as a truck fuel in Sweden in 2010. A more recent, promising avenue is producing new molecules from sugar using bacteria or yeast. The family of molecules that we know how to produce is growing fast. We are closely monitoring sugar conversion processes through our interest in Gevo, a U.S. start-up that is developing a proprietary technology to convert agricultural waste products into renewable, alcohol-based liquid fuels. Lastly, the use of microalgae, cyanobacteria and other phototrophic organisms present in water that can directly convert light and carbon dioxide into molecules holds out amazing potential. These phototrophic organisms change the environmental equation, because arable land is not needed to cultivate them. We are actively building our expertise in biotechnologies through partnerships with academic research institutions and start-ups.

Four alternatives to oil in the chemical industry


In partnership with Galactic, Total Petrochemicals inaugurated the Futerro demonstration unit (see photo) in 2009 to produce polymers from polylactic acid (PLA) derived from renewable resources. It is also paving the way for a commercial methanol to olefins (MTO) process that would enable petroleum-derived naphtha to be partially replaced by biomass, natural gas or coal. Cook Composites and Polymers intends to incorporate 15% biomass in its resins within five years. For its part, Cray Valley wants to raise to 60%, and eventually 90%, the renewable materialssourced carbon used in its composites for the automotive industry and housing.

20 / Environment and Society Report 2009

Alternative Energies

Two questions for

VINCENT SCHACHTER Vice President R&D, Total Gas & Power Photovoltaic solar energy has environmental impacts. How do you factor them into the picture? Its one of our research focuses. Were working on a life cycle assessment (LCA) of the silicon process with IMEC and other

organizations. We want to minimize the environmental impact of the manufacture and use of photovoltaic cells, especially thin lm technology, by comparing alternative semiconductors such as copper-indium-selenium alloy. That has led us, for example, to rule out cadmium telluride (CdTe), because we dont feel that the absence of hazards during the product life cycle has been adequately demonstrated. Were also studying the long-term availability of these resources, as well as the durability of organic solar cells. End-of-life disposal of used modules is also becoming an issue. Thats why Total decided

to join PV Cycle, a voluntary take-back and recycling program for end-of-life modules set up by the photovoltaic industry in Europe. What does life cycle assessment offer the booming bioenergy sector? Were expanding our LCA capabilities in all of our businesses and partnering with the most proactive players in the eld. For instance, we have joined the United Nations Environment Programs (UNEP) Life Cycle Initiative and have endowed a chair at the Interuniversity Research Center for the Life Cycle of Products, Processes and Services

(CIRAIG) in Montreal, Canada. These initiatives give us access to the most sophisticated, robust methods and databases. Its the type of approach that guides our choices in planning responsible biomass use. Considerations such as competition with food crops, the amount of land required, farming conditions, health, yields and total carbon footprint must be analyzed across the cycle. Microalgae, for example, need neither arable land nor potable water to grow. But we still have a long way to go to evaluate all the impacts of this option, select the right species and make processes more competitive.

IDENTIFYING AND OPTIMIZING THE MOST PROMISING BIOMASS OPTIONS

What is the best path to take from raw material to nished product, such as automotive and other fuels or chemical feedstocks? The process involves intermediate steps to convert the resource, depending on its type, to sugars, synthetic gases or fatty acids/triglycerides. Total maintains science and technology watch, conducts R&D, invests venture capital and integrates innovations into demonstration units and pre-commercial pilots to assess the various conversion options and develop the most promising.

TOTAL / 21

Q04

Total has a major impact on the regions economy, environment and employment. Are there any responsibilities in these three areas that Total will no longer assume in the future?
JEAN-CLAUDE WEISS

Chairman of the Caux Valle de Seine Municipalities Association, Normandy, France

Social Responsibility

Answer: We have always assumed our responsibilities on all three fronts and will continue to do so in the future. In the Le Havre region, for example, we are investing massively to upgrade our rening and petrochemical sites. Several recent initiatives have mitigated their environmental impact, especially in terms of air emissions and water quality. Since 2008, both the Normandy renery and the Gonfreville-lOrcher petrochemical plant have introduced a more structured form of dialogue with neighboring municipalities and associations, so that we can work together to improve in all three areas. Trends in our markets have forced us to make tough decisions in recent months. In France and elsewhere, we have had to redeploy certain operations. We are doing everything we can to minimize the effects on employment and the local economy. But we cannot stand still. Continual adaptation is how we secure both our future as an industrial operator and the future of our host regions.
More than

8,250 45
people hired worldwide under long-term contracts in 2009.
Continue to invest to maintain the current and future competitiveness of our businesses, by anticipating market trends. Put our social responsibility and community support commitments into practice, by proposing appropriate solutions for employees affected by the restructuring of our operations and by helping to preserve the local contractor base.

million

spent over the last ten years to revitalize local labor markets affected by the restructuring of our operations.

of employees surveyed in 2009 would recommend working for Total to their friends and family.

78%

Our objectives and business principles


Introduce human resources innovations as well, to continually make working conditions more attractive. Broaden, align and strengthen benets for all of our employees worldwide. Promote diversity, equal opportunity and employability through what we do in the eld, our hiring practices, and our career management and training policies.

TOTAL / 23

Adjusting our production base to accommodate market trends


Every industrial operator interested in staying competitive to secure its future must control costs and adjust to demand. Both requirements are especially important as we deal with the ongoing changes occurring today.
A RADICALLY DIFFERENT ENVIRONMENT FOR REFINING
The year 2009 underscored a major trend, namely the structural decline in demand for petroleum products in the mature markets of Europe and North America, which now expect more sophisticated, environmentally friendly products, but in smaller quantities. The rening industry as a whole must adjust to this new reality. In 2009, it led to a collapse in consumption, built-up inventories and excess capacity. On the other hand, demand remains strong in regions such as Asia and the Middle East. To take advantage of this, Total has joined forces with Saudi Aramco to build the Jubail renery. Scheduled to come on stream in 2013, this huge, ultra-efcient facility will have secure access to crude oil and major export markets.

WEATHERING ADVERSITY, INVESTING FOR THE FUTURE


To ensure the future of rening in both Europe and the Atlantic Basin, we are putting the reorganization of our production base on a faster track. Examples include the rollout in 2009 of a major project to upgrade the Normandy renery in France and the commissioning of a new desulfurization unit in Leuna, Germany. These improvements will address three challenges specic to Europe: supplies of increasingly sour crude, gasoline and heavy fuel oil surpluses contrasting with a shortage of diesel fuel, and increasingly stringent fuel specications. Change is also in motion in the United States. With a new deep conversion unit known as a coker that will be operational in 2011, the Port Arthur renery will be better equipped to process heavy crude oil and supply larger quantities of low-sulfur, light distillates.

PETROCHEMICALS: COMING OUT OF THE RECESSION STRONGER THAN EVER


For the last several years, we have been adapting our petrochemical facilities to the profound changes in this industry as well. The petrochemical sector is now making extensive use of the Middle Easts natural gas and the ethane derived from it to produce ethylene. Total is part of the trend, inaugurating the worlds biggest ethane steam cracker in Qatar in early 2010. In addition, several of the regions countries are ramping up capabilities across the chain and will soon become major suppliers of polymers and semi-nished products

A recongured renery in Gonfreville, France


By investing some 770 million in the facility between now and 2013, Total will transform the Normandy refinery, which is being completely reorganized around the recently installed distillate hydrocracker (DHC). The unit converts heavy oil fractions into ultra-low sulfur distillates, such as motor diesel and jet fuel. The result is a product line that cuts carbon emissions by 25% and is more aligned with demand in the regional market, thanks to a 60% reduction in gasoline surpluses and a 10% increase in diesel production.

24 / Environment and Society Report 2009

Social Responsibility

for the European market, among others. It is therefore essential to continually boost the productivity and performance of world-class European hubs such as Gonfreville, to ensure their viability. That is the driving force behind the more than 200-million modernization plan announced in early 2009, which follows an earlier plan launched in 2006.

deterioration in the market. This resulted in temporary shutdowns or processing cutbacks at Port Arthur in the United States, Lindsey in the United Kingdom and Donges, Gonfreville and Dunkirk in France. Except for Dunkirk, where production was halted in September, all of the reneries were able to resume operations.

Supporting restructurings by afrming our roots in the region


The decisions we are forced to make to redeploy our operations do not lessen our sense of solidarity with and support for our long-standing host regions.
Shrinking demand for capital and consumer goods adversely impacted several specialty chemical units. We were careful to ensure that the terms and conditions offered to employees affected by these redeployments conform to best local practices in every case. The adjustment plan rolled out for certain French rening and petrochemical sites in March 2009 was implemented in accordance with the employee support commitments made at the time. Yet in the rening sector we, like most of the industrys major operators, were forced to adjust our capacities a second time during the year, in response to further

AN INDUSTRIAL MAKEOVER PLAN FOR DUNKIRK


Hard hit by shrinking primary markets, especially in France, the Dunkirk facility posted more than 130 million in losses in 2009. In March 2010, given the poor outlook, we announced that the site would be repurposed away from rening operations under a plan to secure the industrial future of the site, leverage the employees high-end skills, preserve jobs and support contractors and the local economy. The plan will be ne-tuned as part of the information and consultation process now under way with employee representatives and discussions with government authorities and other stakeholders. It currently features several components, including the creation of a technical support center for Total reneries and a training center for rening jobs, the conversion of the storage tank farm into a logistics depot, the installation of a second-generation biofuel production pilot, and nancial, technical and commercial involvement in the EDF-led project to build an LNG receiving terminal. The terminals construction will create nearly 1,200 jobs. Rening personnel will be given hiring priority for the units operational positions. The plan makes provision for individual solutions

Total Dveloppement Rgional (TDR), a Total organization specializing in support for small businesses, is offering the benefits of its experience to socioeconomic stakeholders in and around Dunkirk, to perform an overall assessment of the region and look for solutions to save local jobs or even create new ones. Through complementary initiatives such as financial support for start-ups and acquisitions, export support, technical aid and skills sharing, TDR has helped around 1,000 small businesses in France in the last ten years.

TOTAL / 25

and support for each employee, none of whom will be laid off. Options include moving to another job onsite, transferring to another Total facility or taking early retirement. Total has also pledged not to close or sell any other renery in metropolitan France within the next ve years.

Making ourselves more attractive as an employer


We are stepping up efforts to build diverse teams, promote fairness and quality working conditions, and listen and respond to employee expectations, because we realize our future success depends on it.
CONTINUING TO ATTRACT AN ABUNDANCE OF TALENT FROM ALL BACKGROUNDS
Despite the tough economy, we have not abandoned our active policy of recruiting new people, so that we can prepare for the post-recession era and ensure the success of future projects. Though down from 2008, recruiting levels were still high. Some 8,253 people were hired under long-term contracts in our managed scope worldwide, including nearly 1,500 in France, and another 7,700 were hired under xed-term contracts. We plan to continue hiring in 2010 and to afrm our commitment to diversity, by constantly increasing the

number of women and non-French nationals at every level of the organization. In France, almost 800 young people came on board in 2009 under apprenticeship or skills acquisition work-study contracts. Working with government authorities, Total created a community development fund for youth in April, with an endowment of 50 million through 2014. Its goals are to step up initiatives under way to promote equal opportunity at school, facilitate access to employment, and tackle the problem of social exclusion.

STRENGTHENING AND EXPANDING A COMMON BASE OF BENEFITS


We want to provide all our employees with equivalent benets, taking into account specic local legislation. In line with this commitment, we have established a global standard for insurance coverage offering a payout, regardless of cause of death, equal to 200% of annual gross salary. At December 31, 2009, 85% of the workforce of the 92 companies polled under the Worldwide Human Resources Survey (WHRS), or more than 68,000 employees, had death benets coverage in line with Total standards. That is almost 5,000 more employees than in 2008. In addition, last November management and employee representatives signed a framework agreement to establish a temporary and permanent disability benets oor of 80% of gross salary. It covers 43,000 employees of subsidiaries in France that are more than 50%-owned by Total. We continue to work on aligning employee benets.

Long-term hires by region


9.5%
Africa

7.0%
North America

17.0% 28.2%
Europe excluding France South America

In 2009, 82% of all hires

16.6% were made in a country


Asia

17.3%
Metropolitan France

4.4%
Other

other than France. Women accounted for close to a third of all new hires.

26 / Environment and Society Report 2009

Social Responsibility

In China, where we employ more than 3,800 people, all businesses inclusive, we completed a market and insurance benets alignment study for our 20 subsidiaries in the country. A target plan covering death, accident and health benets was prepared with local staff and a call for tenders to select a single insurer was nalized, allowing us to capture economies of scale. The program will be phased in during 2010 and a special effort will be made to ensure that employees know about their new benets.

Two questions for

benets and enjoyable working conditions. The crisis served to highlight these advantages. Doesnt the uncertain future of the oil industry affect their sense of security? Yes, of course. The crisis, the debate about peak oil and the questions about climate change are all topics forcing Total to rethink its business model. Employee concerns about these issues have risen. They expect Totals senior management to demonstrate its ability to secure the future of energy and clarify strategy.

ASSESSING EMPLOYEE SATISFACTION TO OPTIMIZE THE EMPLOYER-EMPLOYEE RELATIONSHIP


Conducted every two years, the Total Survey measures employee satisfaction and involvement and spots nascent expectations and trends. The data collected at end-2009 for an expanded scope and amid the nancial crisis are especially enlightening. Nearly 44,000 employees from 292 sites in 92 countries responded, for record participation of 68%. Some 80% of employees report that they are satised with their jobs, 84% say they are condent in Totals future and 78% would recommend Total as an employer to their family and friends.

ANTOINE SOLOM Head of the Employee Relationship Practice at Ipsos Loyalty You are in charge of the Total Survey employee satisfaction poll. How has the crisis impacted the way Total employees perceive their company? It has brought feelings and perceptions to light. Employees talked about their motivation, condence in the future and well-being. Their satisfaction with their work situation is 16 points higher than the average for oil industry companies. Thats a lot. All over the world and by a large majority, they perceive their company as a refuge, providing them job security, signicant employee

Helping French small businesses expand into export markets


Based near Grenoble, France, Airstar invented the lighting balloon, which is used in rescue operations and to light movie sets and photo shoots. The company, the global leader in this niche, has made a successful first foray into China, winning the 2009 Chamber of Commerce and Industry International Award for China, in December 2009. A sponsor of the event, we are supporting the fast-growing company, in line with our Solidarit dEntreprise business support program. In China and a number of other countries, our support takes the form of co-op and intern placements for small businesses and arranging prospecting initiatives. Likewise, Total has signed on to the Pacte PME International (International Small Business Export Piggyback Program), an initiative introduced in early 2009 by the French government to help small businesses grow outside France.

TOTAL / 27

Q05
How will ongoing dialogue with employee representatives help improve safety?
REN JACQUOT

Secretary of Totals European Works Council

Safety

Answer: Improving safety is an ongoing priority and a continuous process that involves every one of us. We must all senior executives, managers, Total and service provider employees, and employee representatives advance together. Because of their familiarity with the local environment and their legitimate standing, members of local organizations for discussion and consensus building provide valuable input, both for safety and the analysis of accident causes. Dialogue with employee representatives at every level is an invaluable improvement driver. Thats why the Safety Inspection Task Force set up in 2009 (see following pages) began and ended each site tour with wide-ranging discussions with members of the Health, Safety & Working Conditions Committee. The task forces main ndings were reported to the members of the European and Central Works Councils at a special joint meeting in March 2010, at which it was agreed that regular progress reports would be made.

400
More than

sites presenting major technological risks operated worldwide.

455
More than

million

hours worked in 2009.

200,000 500
employees and contractors concerned.

million

spent each year on safety and the environment at existing facilities.

Our objectives and ambitions


Consolidate the improvement in the total recordable injury rate by setting a reduction target of a further 25% for the period 2010-2013. Write and uphold a common set of Golden Rules, implemented across our units, to foster a constant awareness of the risks inherent in our businesses. Continue to work toward zero accidents everywhere and become a benchmark for workplace safety among world-class companies. Strengthen our technological risk management processes, by applying extremely demanding standards to safeguard the integrity of our production and logistics operations. Share best practices more widely, report abnormal situations and near misses more consistently, and mine an increasingly structured knowledge base of learning from experience to further entrench Totals safety culture.

TOTAL / 29

Maintaining the highest level of vigilance


A year of contrasts in terms of performance, 2009 reminds us of the need to further step up individual and collective efforts on what remains our top priority: safety.
STRICT STANDARDS, HUMILITY AND PERSEVERANCE
Accidents regardless of their cause or severity dont have to happen. The nature of our businesses requires us to manage a broad spectrum of risks, from minor injuries to the loss of facility integrity, a rare but potentially catastrophic event. The gures for 2009 testify to the progress we have made in recent years. The total recordable injury rate (TRIR) per million hours worked by Total and contractor employees the indicator for accidents with and without lost time has been halved since 2006 and fell another 14% in 2009. The lost time injury rate (LTIR) per million hours worked by Total and contractor employees, down 47% in the last four years, has shown similar improvement. These results are a tribute to our determination and our efforts. They include vigilance by employees, rigorous organization, and the introduction of safety management systems (SMS) audited using recognized protocols at virtually all of our major sites. In addition, substantial outlays of more than 500 million are made each year to prevent all types of risk.

TAKING NOTHING FOR GRANTED


Three observations keep us on our toes. First, we experience too many fatalities, especially related to transportation by road of our products in countries where conditions are particularly challenging. We have introduced extremely demanding processes to eradicate this scourge. Second, we regularly benchmark our methods, standards and performance against the other international oil majors. The exercise is one component of our improvement process. But although we have matched their level of performance overall since 2006, we still need to close the gap separating us from the best of our peers. Lastly, in 2009 we experienced a succession of unusual and distressing serious accidents in France. Investigations were conducted to understand the specic circumstances of each and learn from them. However, our overall performance improvement made this string of tragedies all the harder to understand. We therefore felt it was imperative to thoroughly reexamine our practices and decided in August to set up a Safety Inspection Task Force also referred to by its French acronym, IGS to tour 13 French sites from all of our business segments.

LEAVING NO STONE UNTURNED TO SHAPE ACTION PLANS


Why do high-risk-potential situations still occur at our facilities? And why do sometimes signicant gaps persist between our demanding standards and actual practice? To answer these two key questions, a team of

Total recordable injury rate


(per million hours worked)

Sites presenting technological risks with SMSs audited using recognized protocols
76% 83% 88% 96%

10
9.5 7.4 6.0

Scope: Total (Upstream + Downstream + Petrochemicals + Specialties)


6.3 5.1

68% 58% 45%

4.4

3.9

4.2 3.4 3.6 2.9 2.6 3.1 2.5

2003

2004

2005

2006

2007

2008

2009
(target >95%)

Scope: Oil (Upstream + Downstream + Petrochemicals)

30 / Environment and Society Report 2009

Safety

11 experienced professionals inspected six reneries, two petrochemical plants, three fertilizer plants, one gas production facility and one natural gas storage facility in France. Over a ve-month period, they spoke to hundreds of people about seven focus areas, including how operations are managed, contractors and skills

management. In addition to producing reports for each individual site, the task force presented 58 practical recommendations designed to strengthen requirements for the most critical processes and their disciplined implementation across the Group.

Three questions for

GRARD ROUSSEL General Manager of the Normandy renery and head of the task force Where do you see most of the untapped potential for improving safety? Accidents happen when a number of safety barriers technical, organizational or human fail. We spend heavily to maintain the integrity of

facilities. Our organization and tools are robust. We must safeguard those strengths, but people remain the heart of the system. A better understanding of the complex relationship among technical, organizational and human factors is probably the main avenue for capturing further improvements. What were your recommendations to spur improvement? Ill mention one: encourage personnel, including service providers, to let us know about any problems they have applying procedures and get them more involved in improving them. Safety depends on following precise,

often demanding rules. Frontline employees nd rules easier to adopt when theyve helped write them. Managers must do more than just model exemplary behavior they must provide more direction and more leadership. Employees and people have to be discouraged from bending or breaking safety rules through closer supervision in the eld. What role do employee representatives play in this process? We must all move towards a common set of fundamental rules. In France, members of the Health, Safety & Working Conditions Committees are

already helping us get there. But here, too, we can do better, by stepping up dialogue, by making the initiatives deployed as a result of their own audits more intelligible, and by laying out the facts of problems so that we can nd solutions. When it comes to safety, managers, personnel and employee representatives are on the same page, focused on the same issues: risk management and an absolute priority on safety.

Fatal accidents by cause over ve years


2%
Other

11%
Employee travel by road

21
36%
Site operations

fatalities in 2009 9 in site operations 8 in product transportation by road 2 in employee travel by road 2 during a seminar activity

51%
Product transportation by road

TOTAL / 31

Building a shared safety culture together


Organization and technical barriers, no matter how robust, are not enough. They must be rounded out by a safety culture everyone can and must embrace, a process we are building on year after year.
THREE EXAMPLES OF BOOSTER INITIATIVES IN 2009, IN REFINING, EXPLORATION & PRODUCTION AND PETROCHEMICALS
Shaken by several serious accidents, Rening opted last April for an innovative approach to better understand what caused them. Its OSER drive (the French acronym for Operation Rening Safety Together) drew on the expertise of sociologist Marcel Simard, an industrial safety and occupational health specialist. Aligned with the Safety Inspection Task Force, the idea in this case too was to focus on the actual experience of personnel before proceeding, in a second step, with action plans. Based on 2,200 questionnaires and 500 interviews with Total and contractor employees, the analysis found a strong consensus on the value of rules and procedures. But it also highlighted how, in matters of safety, different stakeholders sometimes have different perceptions of risks and practices. The three areas of focus identied by OSER are: more closely supervised and at the same time more participatory safety management, more effective

integration of the best practices developed onsite, and the need for continuous dialogue between frontline employees and their supervisors. These conclusions largely echo the Safety Inspection Task Forces ndings.

CAPITALIZING ON THE EXPERT EYE OF OPERATORS


The strides made in critical task analysis at the Antwerp petrochemical plant in Belgium were driven by the same desire: namely, start with the realities on the ground in order to ask the right questions, at the right time, using a software application developed by and for operators. The result has been a much faster census and analysis of critical tasks in the last two years. At the Laporte polypropylene production plant in the United States, the Contractors Helping Everyone Stay Safe (CHESS) program was led by employees of maintenance contractor Austin Industrial. In this case, too, their suggestions helped hone analysis of the most potentially hazardous situations and nd better ways to mitigate them.

STAYING AWARE OF RISKS


From late 2008 through 2009, Exploration & Production conducted two trials, in Cameroon and the United Kingdom. Participatory brain-storming sessions focused on a number of questions, such as: What is the best way to conduct and analyze safety perception surveys using Totals Culture-Based Safety (CBS) process? How do we bring everyone concerned together to determine the right processes for reporting deciencies? How should we

Facilitating consensus building in France through dialogue on Technological Risk Prevention Plans
Total operates more than 60 sites in France covered by the European Union Seveso II Directive. Technological Risk Prevention Plans (PPRT) are drafted by the government to mitigate the effects of possible serious accidents by shaping land use around Seveso-classified facilities. In 2009, several sites kicked off the official phase of discussion and consensus building with the public, expected to last at least 18 months. The various local stakeholders are now accustomed to dialogue on the environmental impacts, risks, disamenities and socioeconomic benefits of our facilities. Volunteer organizations such as the Feyzin Refinery Neighbors Conference and the CLIE community advisory panel at the Provence refinery prepare stakeholders to discuss these plans, which raise strong, sometimes conflicting issues. Examples include the safety of people, local economic development and regional development. The strong turnout and involvement of elected officials and nearby residents in the meetings held over the course of the year are proof of that.

32 / Environment and Society Report 2009

Safety

respond when safety rules are ignored? All of these examples reinforce a key idea: safety is not just for specialists. Although risk management requires ever-greater involvement across the management chain, each of us must, at our own level, incorporate it into the way we do our jobs.

PATROM: EVER HIGHER STANDARDS


PATROM, our overseas road transportation improvement program, originally deployed in Africa and the Middle East, has been a cornerstone of our efforts to improve road safety since 2002. It relies on the commitment of everyone involved and implements very concrete measures, such as contracts signed by carriers, truck inspections, driver training and the installation of event data recorders in vehicles. In 2009, 73% of the transportation managers at our African subsidiaries completed a course organized with the help of APTH, a French association to prevent oil and gas transportation accidents. To supplement courses already offered, we designed an educational booklet with publisher Codes Rousseau focusing on driver behavior, the cause of 70% of all fatal accidents. Work is under way to revise the technical specications for trucks, notably in order to align them with European Union tank truck standards. An IT tool ensures that pre-loading vehicle compliance checks are reliable. Every aspect involved, including safety, security, operations, procurement and the environment, will be incorporated into the comprehensive road transportation management system currently being built.

Making roads safer


With more than 340 million kilometers traveled by road each year in Africa to transport products in challenging driving and infrastructure conditions, strengthening road safety is more relevant than ever.
SUPPORTING THE MOST PROMISING MULTILATERAL INITIATIVES
Through our subsidiaries, we are involved in a number of initiatives to reduce road risks, especially in Africa, Asia and South America. We are also an active member of the Global Road Safety Partnership (GRSP) launched by the World Bank and the World Health Organization. Partners pool competencies and share the latest advances in road safety to serve joint initiatives by governments, large businesses and local NGOs. As well, we are working with the World Bank on a large-scale project to make trafc safer on two of Africas main and most dangerous cross-border highways: one from Mombasa in Kenya to Kampala in Uganda and one from Douala in Cameroon to NDjamena in Chad and Bangui in the Central African Republic.

PATROM DEPLOYMENT

TOTAL / 33

Q06

What can subsidiaries expect from the Group to help them handle sensitive cases as far as ethics is concerned?
JUDITH T. NAVARRO-DIPODIPUTRO

Total E&P Indonsie employee

Ethics

Answer: Each employee must put into practice our commitment to integrity, respect for fundamental rights, and preventing bribery, corruption and fraud in their day-to-day decisions in the eld. Its an ongoing process. Totals Ethics Committee plays a key role by listening to and advising employees. Rules, procedures and whistleblowing processes are in place. To make sure everyone adopts them, we again stepped up our efforts in 2009, making management more accountable, providing training and deploying new resources designed specically for operational employees. We also participate in several multilateral initiatives that share the goal of promoting a broader embrace of high ethical standards. But it is through our own exemplary conduct that we can make the most decisive contribution in this area.

2,172 63

senior managers trained in 2009 through the Ethics and Business Seminar.

440,000 78

copies of the Total Code of Conduct distributed by end-2009, in 24 languages.

cases handled by our Ethics Committee in 2009, including 32 questions or requests for advice from employees and 31 case referrals.

ethical assessments conducted by independent consultant GoodCorporation since 2002.

Our commitments and business principles


Base our operations only in countries where we can apply our Code of Conducts principles, and exercise special vigilance in certain sensitive host countries. Uphold and promote fundamental rights everywhere we operate. Protect the safety of people and property and the security of our facilities while ensuring respect for human rights. Treat integrity, measures to combat corruption and fraud and respect for free competition as fundamental elements of our relations with partners. Promote transparent revenue ows to host governments, through voluntary initiatives. Leverage the expertise of independent organizations to objectively assess our practices, in order to drive continuous improvement. Continue our efforts to raise awareness of, explain and educate employees about ethics, to cultivate an even stronger culture of responsibility in our organization.

TOTAL / 35

Articulating, applying and sharing our principles


Total upholds a basic set of values and business principles that serve as commitments to all of our stakeholders.
RESPECTING THE CODE OF CONDUCT TO ACHIEVE GROWTH AND LASTING SUCCESS
Regularly updated since its rst publication in 2000, our Code of Conduct sets out the commitments of senior management. It formally states the ethical values and principles paired with international reference documents adopted and shared by all Total units. It describes the behavior expected of everyone, every day, in every corner of the world. Management is responsible for implementing such fundamental principles as respect for human rights, a constant focus on safety and environmental protection, integrity, exemplary conduct and mutual support, both within the company and with regard to the communities and partners associated with our operations. The Code of Conduct can be adapted to address specic topics or local concerns as needed, to help raise their prole and ensure they are taken into account. Several supplementary documents and charters were published in 2009, in Russia and Myanmar for example.

ETHICS AND COMPLIANCE PROCESSES MUTUALLY REINFORCING EACH OTHER


To our mind, establishing benchmarks and putting barriers in place are inseparable. Strengthened regularly for the last ten years, our ethics process emphasizes prevention and motivating individuals based on common values. However, enacting strict rules to clear up ambiguities and help employees remain vigilant is just as important, hence the creation of the Compliance and Corporate Social Responsibility Department in early 2008. In addition to its advisory role, in 2009 the department focused on consolidating our internal guidance, ensuring teams are aware of the need to apply it, and making management more accountable. Working closely with the Ethics Committee, it oversees management of the legal aspects related to areas such as integrity, anti-corruption, human rights, environmental, health and safety legislation, sustainable development, and community support issues in general.

RAISING THE BAR


In 2009, we adopted a new Health Safety Environment Quality Charter, which articulates anew and explains the ten principles everyone must uphold. We worked on adapting our policy regarding the rights and specic requirements of indigenous peoples, who host our operations in several countries. Exploration & Production standardized the clauses it includes in its contracts with service providers and contractors, especially those pertaining to health and

Totals principal international reference documents


Universal Declaration of Human Rights Fundamental conventions of the International Labor Organization (ILO) OECD Guidelines for Multinational Enterprises United Nations Global Compact Voluntary Principles on Security and Human Rights (VPSHR)

Cases handled by the Ethics Committee


Referrals Questions and requests for advice

31 32

25

26 22 13

2007

2008

2009

In 2009, the Ethics Committee handled more questions and requests for advice than referrals. This was in keeping with its main role of preventing potential problems related to the application of our Code of Conduct. The figures given here are not exhaustive, because managers are on the front line when it comes to ethics issues, dealing with more than 200 cases directly.

36 / Environment and Society Report 2009

Ethics

hygiene, safety and the environment. We also initiated a major project to dene more precisely the corporate social responsibility criteria governing procurement policy in our various operations.

SOLICITING EXTERNAL INPUT AND IDENTIFYING AVENUES FOR IMPROVEMENT


We improve our performance by taking a structured approach, involving formal written commitments, upgraded procedures, resources and training deployed at the corporate level and in our business segments and functional departments (HSE, Finance and Procurement among others), and regular audits. We ask consultant GoodCorporation to conduct objective expert assessments of our practices, auditing ve to seven units each year. The units suppliers are interviewed as part of the process. In another move to consider ethics issues as early on as possible, we plan to include certain major projects, such as new oil and gas developments and plant construction, in the scope of these audits, and to involve experts from the Danish Institute for Human Rights (DIHR).

To fortify existing lines of defense, in 2009 we laid the groundwork for a dedicated compliance program. More formal and prescriptive, it will be prepared and implemented by compliance ofcers at the corporate level and in each business, who are organized into a network. The program will be rounded out by stricter procedures, especially governing relations with agents and service providers, mergers and acquisitions, and corporate sponsorship and gifts. We are also interested in nding more effective ways to prevent fraud. To do this, we created a working group at end-2009 tasked with ranking risks in order of severity, coordinating everyone already involved managers, the Corporate Security and Audit Departments and the Ethics Committee and stepping up internal investigation capabilities, while protecting employees.

CONTINUOUSLY IMPROVING ANTI-TRUST COMPLIANCE


Our position on stretching the rules of free competition can be summed up in two words: zero tolerance. But setting a standard is not enough. Companies must also inform operational employees about potential penalties and help them by providing appropriate training. Mindful of this, Rening & Marketing and Chemicals have supplemented their practical guides to anti-trust law in day-to-day operations with e-learning modules exploring the topic in more depth. Several thousand Total employees have enrolled in training of this kind, signing letters of commitment upon completing the course.

TACKLING FRAUD AND CORRUPTION IN ALL THEIR FORMS


All of us have a moral obligation to reject corruption, whether public or private, active or passive, direct or indirect. However, about a quarter of Total employees work in countries presenting a high risk of corruption, according to Transparency Internationals annual Corruption Perceptions Index.

Ethics Committee: educate, advise and prevent


Reporting directly to Totals Chief Executive Officer, the Ethics Committee coordinates a continuous improvement process to ensure we are making regular strides in enhancing employee familiarity with and understanding of the Code of Conduct, as well as its implementation. The Committee has updated training courses and created more resources, including guides, educational CD-ROMs, an ethics intranet and a dedicated e-mail address. The Committee is now working on simulation exercises in the field, to promote discussion, with managements support, on how to prevent non-standard practices. Anyone from inside or outside Total who has a question, has witnessed a breach of ethics or has doubts about a sensitive situation may refer the matter at any time to the Ethics Committee, which is tasked with listening and providing assistance. Its five members, one from the holding company and one from each of the four core businesses, are uncompromising about confidentiality and protecting whistleblowers when circumstances require.

TOTAL / 37

Working to promote fairer sharing of oil and gas revenues


Total supports various projects that aim to share the economic benets of oil and gas revenues more fairly.
ADVOCATING BETTER GOVERNANCE AND GREATER TRANSPARENCY
We have been especially active in promoting the Extractive Industries Transparency Initiative (EITI) ever since it was introduced in 2002. The EITI is based on disclosure to an independent expert of the audited payments made by extractive industries to a government. The government concerned also provides the expert with the amount of payments received in the same year. The expert aggregates the gures furnished by the companies and the government and publishes a report that may mention any differences observed. The report is then submitted to the EITI, which approves it and can upgrade the status of a candidate country to compliant country. www.eitransparency.org

Upholding human rights in our sphere of activities


Required to work in situations that are often difcult, our employees must be exemplary in their respect for civil, economic and social rights. They strive on a daily basis to involve their partners and suppliers in the same process.
CRITICAL DIALOGUE, VIGILANCE AND ENGAGEMENT
Total does not interfere in the political life of sovereign states, but we do voice our beliefs to governments whenever necessary. The Voluntary Principles on Security and Human Rights (VPSHR) is an especially important reference for us in balancing personal and property safety with respect for fundamental liberties. A number of initiatives help drive our thinking about this key issue, including our involvement in the International Petroleum Industry Environmental Conservation Associations (IPIECA) work, the Global Business Initiative on Human Rights (GBI), of which we are a founding member, the consultation process organized by the United Nations special representative and CDA Collaborative Learning Projects. The Ethics Committee, the Compliance and Corporate Social Responsibility Department and the Human Rights Coordinating Committee comprise the backbone of an organization designed to support operational employees. We will, for example, distribute a practical guide to human rights in 2010 and are stepping up our collaboration with the

Sharing our experiences with businesses and civil society


In 2009, some of our specialists contributed their expertise to the guide co-published by the United Nations and Transparency International on how to apply the Global Compacts Tenth Principle on working against corruption in all its forms. Since 2007, we have worked to implement a training tool called RESIST, which helps companies resist improper solicitations encountered in their business dealings. RESIST stands for Resisting Extortion and Solicitation in International Transactions, and was developed jointly by the International Chamber of Commerce, Transparency International, the U.N. Global Compact and the World Economic Forum.

38 / Environment and Society Report 2009

Ethics

Danish Institute for Human Rights (DIHR), a globally recognized, independent organization.

A PILOT SELF-ASSESSMENT TOOL TO HELP FRONTLINE MANAGERS


We have been working with the DIHR since 2007 to develop a tool our subsidiaries and units can use to make sure that their practices are in fact aligned with the Code of Conduct and the principles set forth in the Universal Declaration of Human Rights and the ILOs fundamental conventions. This

self-administered checklist, known as the Human Rights Compliance Assessment (HRCA), is derived from the DIHRs full database and was tested in 2009 in Angola. Other tests will be conducted to provide additional feedback before we implement this innovative resource more broadly. Revamped to make it easier to work with and more relevant to our activities, the HRCA remains the property of the DIHR. As a result, it can be used by other extractive companies faced with similar issues and can serve as a model of best practice for the entire industry.

Three questions for

MARGARET JUNGK Director, Human Rights & Business Department, Danish Institute for Human Rights www.humanrightsbusiness.org What did revising the HRCA for Total entail? We began by mapping all of Totals activities and host countries. This gave us an overview of all the relevant human rights issues to be

covered by Totals policies and procedures. We then selected the most appropriate HRCA questions from a database of more than 300 to address those issues. The entire process was built upon a sliding risk scale, so operations in higher-risk countries would include a wider range of questions and recommendations. What did you gain from working with Total? The operations of a multinational company involve a huge variety of activities and stakeholders. Comprehensively applying a human rights tool to such a wide range of business

activities and political and economic contexts may seem like it only increases the scope of the challenge Total faces. But weve found that, in reality, this holistic approach focuses both Total and DIHR on solutions and the way forward. Knowing the whole range of risks makes them easier to understand and manage. How does DIHR interact with wider stakeholder groups to assist the promotion of human rights? As well as conducting strategic research and developing tools for businesses, DIHR works to further develop and promote international frameworks such as the United Nations Global

Compact, the Global Reporting Initiative (GRI), the OECD Guidelines, the International Finance Corporation (IFC) Performance Standards and the Global Business Initiative on Human Rights (GBI). We also strive to promote human rights in industry sector initiatives and collaborations, like the IPIECA Reporting Guidance and the expert meetings of development nance institutes. We conduct localized capacity building projects, and also chair the National Human Rights Institution Working Group on Business and Human Rights, a worldwide network devoted to addressing the impact of business on human rights.

Visits to Totals dedicated ethics intranet reect growing awareness across the company

400,000

300,000

200,000

100,000

Workshops for new hires, designed to promote Totals ethical values and vision.

2006 2007 2008 2009

TOTAL / 39

Q07

What can I say when people call Total a polluter?


LAURENT CUZOU

Service Station Manager in Saint-Brevin-les-Pins, France

Environment

Answer: Environmental protection is our top priority. Our production and rening activities obviously have an environmental impact, and we are as distressed and concerned as everyone else when accidents occur. Thats why we do everything we can to shrink our environmental footprint. We ne-tune our practices to analyze our impacts in thorough detail so that we can manage them more effectively. Our teams strive to learn even more about the air, water, soil and biodiversity where we work, in order to protect them effectively, often working hand-in-hand with the scientic and research community. We are also continuing to invest in our facilities to keep reducing emissions. Lastly, we have all the resources we can to prevent accidental spills and be ready to respond when they do occur.

29%

reduction in sulfur dioxide emissions from our reneries since 2004.

23

milligrams

per liter: the hydrocarbon content of liquid efuent from Exploration & Production sites in 2009.

of environmentally sensitive sites (as dened in the Reporting Scope and Method section on page 66) were ISO 14001-certied at December 31, 2009.

89%

Our priority actions


Improve our ability to identify, map and assess the critical nature of our environmental impact, by training and educating employees, strengthening our tools and resources, and stepping up innovation. Continuously improve our environmental performance, by allocating more than 10% of our total R&D capital expenditure to this focus. We also spend on R&D to develop products with a lower environmental impact, enhance energy efciency and promote alternative energies. Report on our results transparently and continue to have external auditors verify our key environmental reporting indicators. Continue to strengthen our environmental management system (EMS), extend it to all of our sites, pursue ISO 14001 certication by 2012 for all environmentally sensitive sites, and make biodiversity protection an integral part of environmental management systems.

TOTAL / 41

A holistic approach to risk management


The safety of people and property and the protection of natural environments are interrelated imperatives. We intend to deploy the same strategic risk management process for safety, health and the environment.
Management of all our impacts must be fully integrated into our processes, across the life cycle of activities and operations. That is what motivated us, for example, to pursue internal development of our innovative Environmental Risk Assessment method in 2009. Based on extensive learning from experience, it analyzes the severity of the potential impacts of accidental spills or routine emissions at a facility. The method can more accurately gauge the solidity of the protections in place, enabling action plans to be adjusted accordingly.

At the same time, we are improving our employees ability to deal with crisis situations. Based near Marseille, France, the Fast Oil Spill Team (FOST) is one of Totals internal resources for responding quickly to water pollution incidents. The training courses for in-house and external response teams are certied Level 3 under the guidelines of the International Maritime Organizations International Convention on Oil Pollution Preparedness, Response and Cooperation (OPRC Convention). In 2009, we also provided a self-assessment tool to all Total sites that will allow them to bolster their spill response preparedness.

Safeguarding biodiversity
Factored in at every stage of our operations, biodiversity protection is a key component of our environmental strategy.
A MORE PROACTIVE APPROACH FROM PROJECT DESIGN TO SHUTDOWN
Safeguarding the often-vulnerable ecosystems in which we operate takes careful planning. From lagoons and the deep ocean to Arctic terrain and isolated desert to industrial areas, we keep getting better at it. We do this by expanding the circle of partners helping us to more clearly understand biodiversity issues and by adapting our procedures, such as conducting routine baseline assessments of impacts and regular monitoring over the life of projects.

PREVENTING ACCIDENTAL SPILLS


Applying the lessons learned from the 2008 leak at the Donges renery in France, Rening & Marketing teams came up with a dedicated method to more effectively prevent this type of risk. It is now deployed across our operated reneries and depots in Europe. All Total businesses continuously implement preventive measures, including scheduled audits, regular inspections of equipment subject to corrosion, and early leak detection tests.

Oil spills, 2007-2009 (cubic meters)


7,419

23 2,413

135
2,409 19
1,957 433 Chemicals Downstream Upstream
pollution control equipment deployment exercises in 2009. These simulations provide hands-on experience for frontline teams that may have to respond to spills.

2,474

171 2,022 281

4,983

2007

2008

2009

42 / Environment and Society Report 2009

Environment

Because protecting biodiversity in our operations entails targeted monitoring of the environments in which we operate, we have created observatories at ve sites representative of our businesses, including a recent gas project in Yemen, an operating renery in Feyzin, France, and a decommissioned chemical plant undergoing reclamation in Prmont, France. In so doing, we hope to promote discussion among everyone concerned experts, NGOs, local authorities and communities, and our frontline employees. In addition, we will be able to gather more reliable data on a long-term basis in order to more effectively target our action plans and signicantly broaden scientic knowledge.

Reclaiming sites and managing end-of-life equipment and products


In 2009, we strengthened our comprehensive action plan to optimize the reclamation of contaminated sites and remediation of contaminated soil. We continue to innovate to manage our waste more efciently and recycle materials.
To deploy this action plan, we will need to conduct a complete inventory of the sites concerned and create or strengthen dedicated teams in each business. The plan will also help us share best practices, pool expertise, R&D and project management resources, and better manage related costs.

MORE THAN 200 RESEARCH PROJECTS SUPPORTED BY THE TOTAL FOUNDATION SINCE 1992
In 1992, Total created a corporate biodiversity foundation dedicated to protecting species and ecosystems. One of the model programs supported by the Foundation was the Census of Marine Life, a network of researchers from more than 80 countries involved in a ten-year (2000 to 2010) project to inventory marine life. The Foundation supports six of the 17 projects under this unique international program, including continental shelves, deepwater ecosystems, marine life in the Antarctic, the classication of species using bar codes, and the creation of a deepwater database. The results of this enormous undertaking will be presented in London in October 2010.

HELPING MORE COUNTRIES TO CREATE ORGANIZED WASTE MANAGEMENT CHANNELS


Which approaches are most likely to be replicated over time in non-OECD countries? The pilot project Total conducted in Gabon provides some answers to this question. After introducing shared management of waste from our Upstream and Downstream activities, the pilot continued in 2009 with three new elements: the consolidation of hazardous waste that could not be treated locally for transfer to France for disposal

120,000
Giant deep-sea mussels, one of the species inventoried as part of the Census of Marine Life, a program supported by the Total Foundation.

tons per year of used engine oil given a second life as high-quality base oil, diesel fuel or asphalt and 45 direct jobs created in Gonfreville, France. Thanks to new licenses secured in 2009, the Osilub plant, which combines the skills and expertise of Total and Veolia, will be up and running in 2011.

TOTAL / 43

in line with the Basel Convention governing cross-border movements of hazardous waste; the creation in Gabon of a certied channel for collecting and treating used oil; and the pooling of best practices for the recovery of tank bottom sludge.

Improving air quality near our facilities


While working to curb carbon emissions, we are also focusing on reducing our emissions of sulfur dioxide (SO2) and non-methane volatile organic compounds (NMVOCs).
A PERCEPTIBLE, PERMANENT REDUCTION IN SULFUR DIOXIDE PEAKS AROUND OUR REFINERIES
Renings total sulfur dioxide emissions continued to fall in 2009, and are now down a total of 29% since 2004. Sulfur dioxide peaks, a signicant disamenity for local residents, have declined as a result of work undertaken several years ago. The main driver has been forecasting and modeling emission dispersion using the proprietary Picasso application. Deployed at the Donges, Normandy and, soon, Provence reneries in France, it can be utilized to adjust unit operation and shorten response times. The second mechanism has been targeted spending to upgrade our units with the highest emissions, including, in 2009, an overhaul of the Provence renerys sulfur units

and the testing of a new ue gas scrubbing process at the Donges facility. Our third priority is heightened vigilance by operators, who are being asked to monitor specic indicators, follow tighter procedures and adopt best practices. To further our progress, our current focus is on responses to unusual weather patterns and accidental equipment failure.

DOING MORE TO PROTECT NEIGHBORING COMMUNITIES AND EMPLOYEES AGAINST VOLATILE ORGANIC COMPOUNDS (VOCS)
We are working on detecting VOC emissions and are gradually equipping our sites with tools such as infrared cameras. We are also stepping up and optimizing the use of vapor recovery systems during loading and ofoading. For example, this type of equipment was installed at the Carling petrochemical plant in 2009 to minimize benzene emissions during the loading of trains for the Gonfreville petrochemical complex.

Ertvelde, Belgium: a three-phase reclamation project


Cleanup of the former Ertvelde lubricant and white oil plant in Belgium, which operated from 1923 to 1977, shows just how complex this kind of job can be the site is studded with unexploded bombs from World War II. Teams from Total Petrochemicals Mont-Lacq R&D center worked with Refining & Marketing to draw up a reclamation plan. 2009 saw the completion, after nearly five years of work, of the cleanup of ponds filled with production waste, followed by offsite neutralization and stabilization of the acid sludge and contaminated soil. A total of 275,000 cubic meters were excavated, of which 22,000 cubic meters were sent to a treatment center. The remainder was neutralized and encapsulated. A total of 169,000 cubic meters of groundwater and pond water was pumped and treated. Treatment of the soil around the decommissioned facilities started in 2009 and will require excavating and remediating 35,000 cubic meters. This will be followed by groundwater treatment, in Phase 3.

44 / Environment and Society Report 2009

Environment

Protecting water resources


Water management requires specic action plans for each business, in order to use less, recycle more and improve the quality of discharges.
WATER, A CORE CHALLENGE
For every barrel of oil produced, roughly one barrel of water is extracted from the reservoir. And the proportion of water increases as elds age. So R&D teams are developing technologies to optimize production water reinjection. The aim is to maintain reservoir pressure, which in turn increases oil and gas recovery, and to promote water recycling, thereby curbing both use and discharges. That means implementing ever more sophisticated processes, including membrane ultraltration, to prevent plugging of injection wells. Efforts continue unabated to reduce the hydrocarbon content in production water discharges. A ceiling of 30 milligrams per liter has been set per site and 10 milligrams per liter for discharges in onshore and inshore areas. This was the motivating factor for recent workovers in Cameroon, Congo, Indonesia and the United Kingdom. To reduce the impact of discharges, work is focusing in particular on more detailed analysis, biomonitoring methods, and techniques to simulate the diffusion of discharges and their impact on the environment.

ANTICIPATING EVER STRICTER REQUIREMENTS


The European Unions Water Framework Directive creates an obligation of results concerning the chemical and ecological status of watercourses and receiving groundwater that must be met by 2015. Research on hazardous substances in water, conducted at all of Chemicals major European sites in 2009, is continuing in 2010 with eld analysis campaigns. In France, activated sludge secondary treatment was introduced at both the Provence renery and the Gargenville storage facility in 2009. At the Feyzin renery, the construction of a dissolved-air otation unit and an overhaul of the system to recover oil from process water have lowered the hydrocarbon content of liquid efuents. At the Grandpuits renery, better management of efuents through increased recycling has reduced both the facilitys water use and discharges, by 17%.

Strict standards and transparency in dismantling the Serepca FSO


The Serepca floating storage and offloading (FSO) barge was anchored offshore Cameroon. When it ceased operations in 2008, teams from Total and French waste specialist Sita were responsible for removing the waste and transporting it to Europe. First, the FSOs tanks were cleaned and the sludge brought onshore to be treated in a local cement plant owned by Lafarge. Transportation of contaminated material to Europe and transfer of the barge to China were carried out in accordance with the Basel Convention. The Chang Jiang Shipbreaking Yard met our criteria, which included impressive references, recognized certifications such as ISO 14001 and OSHAS 18001, and compliance with European Union standards, especially for asbestos removal. The entire project, which was completed in late 2009, was monitored at all times by the Platform on Shipbreaking(1), an umbrella coalition of 13 NGOs.
(1) Created in 2005, this NGO is today recognized as the preeminent international advocacy organization on issues related to end-of-life vessels. It brings together NGOs from developed countries and from others, such as India and Bangladesh, that are home to numerous shipbreaking yards (www.shipbreakingplatform.org).

TOTAL / 45

Q08
When it comes to local development, how can you leave your mark without encroaching on the role of government?
MICHEL POATI TCHICAYA

Village Chief, Djeno, Congo, where Total operates an oil terminal

Local Development

Answer: Our actions to improve living conditions in our host countries are grounded rst and foremost in listening, dialogue, and understanding needs. Our aim is to involve local communities and competencies wherever possible. We work with all of our stakeholders to spur regional and local economies, create jobs and cultivate the talent available in the country. It is not our intention to supplant host governments. Our actions in the areas of education, public health and support for local businesses are conducted in line with a strategy developed in concert with the public authorities, to build on or cascade their own initiatives. In this way, we can effectively participate in the long-term development of host countries.
More than

11,000 3,609
students supported by Total in 2009. partnerships have been formed by Exploration & Production subsidiaries with NGOs, universities, associations, foundations, government agencies, and local and international institutions.

hires under long-term contracts, representing 96 nationalities, in non-OECD countries in 2009.

218

Our objectives and business principles


Listen to and understand our stakeholders expectations, in order to pinpoint areas where we can deliver genuine value-added and to seamlessly integrate our operations into the host countrys social, economic and cultural environment. This integration entails respectful, responsible conduct by our employees and is a prerequisite for our medium- and long-term social license to operate. Continue to make our process more professional by strengthening our community development expertise and draw on the skills of NGOs and specialized experts to make our actions more effective. Promote the creation of sustainable businesses and jobs in our host regions, by stimulating the economic base and supporting businesses. Strengthen individual and community capabilities wherever we can, to secure the future and give local communities the resources they need to build and manage their development, based on their own priorities. Put into practice our commitment to supporting host communities, by investing steadily, with our partners, in public health, education, training and expanded access to essential services, such as energy.

TOTAL / 47

Catalyzing development
Creating value for all of our stakeholders means making them partners in our growth, a strategy that dovetails our own interests and those of our host countries.
RESOLVING THE PARADOX OF PLENTY
The poorest three-fths of the global population live in countries with plentiful fossil fuel and mineral resources. Just ve of all oil and gas-rich countries fall into the top quartile of the United Nations Development Programs (UNDP) Human Development Index. Because nearly 75% of our production comes from non-OECD countries, this situation is especially compelling for us. We paid 7.9 billion in income and other taxes in these countries in 2009. But above and beyond that, we want to encourage, to the fullest extent that we can, the unlocking of oil and gas resources to spur economic development at national, regional and local level. That determination underpins our constantly strengthened involvement in the Extractive Industries Transparency Initiative (EITI), which we have supported since it was rst introduced in 2002 (see page 38).

UNDERSTANDING THE LOCAL ENVIRONMENT TO PINPOINT THE PRECISE IMPACT OF OUR OPERATIONS
The scale of our operations can raise high expectations and disrupt existing local balances, especially in economically disadvantaged regions. Identifying our potential impacts more precisely is a prerequisite to reduce and, where necessary, offset them. Compiling exhaustive records on lessons learned, as was done in 2009 for the Yemen LNG project, is an example of our determination to improve in this area. Thats also why we turn to independent outsiders. In Nigeria, for example, we are partners in a eld survey being conducted by a team of researchers in two separate regions since 2008. One is the Ogba/Egbema/Ndoni Local Government Area (ONELGA), where our onshore activities are located and where we are in direct contact with neighbors. The other is Eastern Obolo, where no oil companies operate, but where we have deployed sustainable development programs through the local Eastern Obolo Community Development Foundation (EOCDF), created with the NGO Pro-Natura International in 2002. The survey aims to do more than just assess local community aid projects and compare living standards. It emphasizes interpersonal relations, as reected by the social climate in communities, civic involvement, and a willingness to work together to reach common goals. It highlights the value of a participatory process such as the one in Eastern Obolo and the importance of acting on a regional scale.

Putting the future of Angolan families back in their own hands


Teaching or re-teaching crop cultivation techniques to refugees and demobilized soldiers who were once farmers and are now landless and battered by years of war. Fighting economic insecurity by developing small plots of land that can provide regular sources of income. Providing start-up assistance and transferring expertise and skills to manage farms and sell products effectively. All these initiatives are part of an exemplary project facilitated by the NGO Agrisud in liaison with the government and long backed by Total E&P Angola. The end goal was to support and coach 70 families 400 residents of the towns of Cabiri and Caop, not far from Luanda until they were self-sufficient. Now, after four years of collaboration, the farmers have organized a cooperative and taken over from the NGO. These 400 people can now do a better job of meeting their own needs, and almost 800 people have been trained.

48 / Environment and Society Report 2009

Local Development

LEARNING FROM THE PAST AND SHARING BEST PRACTICES


To increase the benets of our presence in host countries, we also have to increase the real-world effectiveness of our socioeconomic projects, with the help of expert NGOs. These programs take into account the life cycle of our operations, from conceptual studies through to wind-up or decommissioning. At Exploration & Productions headquarters and in its subsidiaries, for example, more than 300 people already work full time to reach those goals. We continue to rely on community development specialists with solid eld experience.

Stimulating the economy and developing human potential


Creating businesses and jobs and training the talent of tomorrow are priorities we share with our host communities.
INCREASING THE LOCAL CONTENT OF OUR PROJECTS, AN INTEGRAL PART OF OUR INDUSTRIAL PROCESS
Hiring local professionals and developing their skills, strengthening local industry and working with local contractors are still the best ways to ensure that our operations deliver lasting benets, wherever we are. Local content is a priority in all of our businesses. Exploration & Production projects have an especially strong leverage effect, of sometimes-unparalleled regional magnitude. Yemen LNG, for example, is the biggest industrial project the country has ever seen, representing a total investment of $4.5 billion. Several thousand jobs, lled by locals, were created during the construction phase. We and our partners hired and trained around 700 people to operate Yemen LNG. Eventually, Yemenis working in operations, administration, support and management will account for 90% of the full-time workforce.

INTEGRATING SUCCESSFULLY THROUGH LISTENING AND DIALOGUE


We believe in all sides getting to know one another, striking out into uncharted territory, explaining our goals clearly, and accepting criticism. These principles are set out in A Guide to Stakeholder Dialogue, distributed in 2009. Frank discussions with stakeholders are the only way to ensure that all viewpoints are aired and taken into account. We have improved our listening and dialogue processes, which help us thoroughly understand the specic contexts in which we operate.

Frances Artre de Guyenne trunkline, a prime example of consensus building


The Artre de Guyenne underground trunkline, which optimizes gas ows between southern and northern Europe, was inaugurated on October 16, 2009, marking the culmination of ve years of work by teams from our subsidiary TIGF. Dialogue with stakeholders government agencies, elected ofcials from 28 municipalities, and 1,500 landowners was organized well in advance to explain the projects impacts and the measures taken to alleviate them. Final tally: more than 700 direct jobs created, foliage screens designed with the input of nearby communities and planted by disabled workers, and natural environments protected by optimizing the pipelines route and conducting the construction work in phases.

TOTAL / 49

HELPING LOCAL CONTRACTORS DEVELOP THEIR CAPABILITIES


Our goal here is to bring more and more local contractors up to international standards in terms of quality, safety and working conditions. We help them to meet specications more fully, deliver higher value-added services and win contracts with other customers. For the construction of the Akpo FPSO, Total Upstream Nigeria Limited (TUPNI) exceeded the requirements of the applicable national regulations by using Nigerian businesses for much of the equipment. As a result of the process implemented very early on to short-list local contractors, the project set a record for local content, with 11 million hours worked in Nigeria out of the total 32 million required to bring the eld on stream. In Angola, too, we were able to rely on national suppliers to perform maintenance on highly sophisticated subsea installations in 2009. From the preliminary design stage on, our projects are planned so that local contractors can perform as much of the work as possible.

years. Support for contractors and a commitment to helping them move into sustainable business niches, such as maintenance, have pushed the level of local content in the subsidiarys projects to 50% in the last ve years, in increasingly varied areas.

INTEGRATING LOCAL COMPETENCIES INTO OUR VALUE CHAIN


In Africa, for example, 90% of the goods and services purchased by Totals Rening & Marketing business are sourced locally, and include fuel storage tanks, service station furniture and uniforms. When the equipment available in a country does not meet our standards, we always examine regional solutions before considering importing from other continents.

BUSINESS SUPPORT, AN IMPORTANT ASPECT OF OUR CORPORATE SOCIAL RESPONSIBILITY


Worldwide, our support for local economic development is guided by three principles: cooperation with governments, specialized organizations, and our business and institutional partners; consistency with regional plans; and integration in the relevant subsidiarys corporate social responsibility strategy. We have a strong tradition of supporting small businesses. Over the last ten years, our dedicated Total Dveloppement Rgional (TDR) team has helped 1,000 businesses, provided 60 million of funding, and created, saved or planned 14,000 jobs through its loans.

IMPLEMENTING A PROACTIVE PROCESS IN INDONESIA


Total E&P Indonsie (TEPI) segments projects and divides work packages to increase the amount of work performed by medium-sized local businesses. One of them, the engineering and construction rm PT Meindo Elang Indah, took full advantage of this approach, achieving remarkable quality, safety and turnaround performances in just a few

Broadening access to sustainable, affordable energy for low-income families


Today, some 1.6 billion people still do not have access to electricity and some 3.2 billion cook their food on wood fires. In addition, the cost of electricity is inversely proportional to income, as is also the case for other essential services. As research by specialists has shown, the poorer you are, the more expensive energy is. Reliable, safe, affordable energy is a prerequisite for development. Total has ten years of experience in this area, particularly in Africa, through rural electrification projects based on photovoltaic solar energy, LPG for isolated, low-income families, gas-fired power generation for communities near our sites, and biofuels produced for local markets. To move to the next level, we are now testing various models with our institutional partners, development stakeholders and civil society. The aim is to identify the most appropriate sustainable solutions for the local environment and, eventually, offer affordable solutions for the 4.5 billion people who live on less than $10 a day, known as the Bottom of the Pyramid.

50 / Environment and Society Report 2009

Local Development

In 2009, a cross-business working group was set up to combine TDRs expertise with other in-house resources to make our initiatives even more effective and learn lessons from various recent pilot programs in Africa, Belgium and Italy, based on in-depth identication of local expectations.

Investing in future generations


Access to knowledge and job skills training, a basic prerequisite for development, is a cornerstone of our community development initiatives.
ACTING IN CONCERT WITH AUTHORITIES
Total supports the construction and renovation of schools, with more than 40 projects currently in progress in 20 countries. We nance grants and scholarships, managed by our subsidiaries or at corporate headquarters, so that students can continue their studies at home or abroad. In 2009, Total supported more than 11,000 students worldwide. Since 2003, more than 400 young people from 24 countries have been able to work toward degrees from top institutions in France business and engineering schools, universities, Institut dtudes Politiques, the Paris-based school of political science, and cole Nationale dAdministration (ENA) school of government thanks to the Total Scholarship Program. We also help interested countries strengthen their

educational systems, through partnerships between French and foreign schools. Examples include IFP School and Bandung Technical Institute (BTI) in Indonesia and ParisTech, a network of leading French engineering schools and research institutes, and Tongji University in China. In addition, Total supports Institut Suprieur de Technologie dAfrique Centrale (ISTAC), created with Institut Catholique dArts et Mtiers (ICAM) engineering school, based in France. With campuses in Cameroon and Congo, ISTAC trains senior technicians and engineers. Also in Congo, our local subsidiary is involved in creating challenging advanced placement classes for high school students in Pointe-Noire, facilitating their access to higher education. We are now focusing on short technical training programs that lead directly to skilled jobs, including with our partners and contractors.

Supporting and cascading government action against HIV/AIDS and malaria


According to the World Health Organization, there were 247 million cases of malaria worldwide, which killed nearly one million people mainly children living in Africa. Some 80% of reported cases occur in sub-Saharan Africa. Already involved in HIV/AIDS prevention, Totals marketing subsidiaries in Africa branched out to fight malaria in 2008. Initiatives include service station campaigns, distribution of some 7,000 practical guides, a million informational brochures and 20,000 educational games, encouraging the use of mosquito nets, and village outreach. The methods and initiatives are tailored to each local situation. In addition, several Exploration & Production subsidiaries have taken up the baton, across several continents, in order to reach as many people as possible. There is no end in sight for the program, in the face of what remains one of the planets greatest health scourges.

TOTAL / 51

Q09

How is your commitment in Myanmar evolving?


IBRAHIM GAMBARI

Joint Special Representative of the African Union and the United Nations for Darfur (Sudan), former Under-Secretary-General, Special Adviser to the Secretary-General on Myanmar

Myanmar

Answer: We will not abandon our commitment to the people living near our facilities in Myanmar and will remain in the country for as long as we can freely apply our own business principles in our operations. We act responsibly in Myanmar, upholding strict international standards such as the Universal Declaration of Human Rights and demonstrating our socioeconomic commitment, which makes a tangible difference to the lives of people there. We transparently report on what we do. Our presence in the country does not mean we endorse the regime, with which we maintain critical dialogue. Leveraging our inuence where we can helps to create conditions that may enable the country to break out of the isolation imposed under a sanctions policy that has apparently reached a blind alley, and to move toward better governance. We believe that our withdrawal from the country would create further hardship for the people of Myanmar.

$2.65

million

2009 budget for our socioeconomic program in Myanmar; with our partners, we have spent more than $20 million on it since 1995.

95%

of the 900 employees of the subsidiary and its contractors are Myanmar nationals.

0.6%
Yadanas share of our total production.

The principles underlying our actions in Myanmar


Uphold strict ethical working practices. We are committed to respecting local culture, treating everyone fairly and avoiding all forms of discrimination. We do everything in our power to uphold universal principles of human rights within our sphere of activities. Foster a climate of mutual understanding with local communities. Cultivating dialogue with local residents, listening to their needs and/or supporting their projects are vital to the success of mutually beneficial partnerships. Significantly improve living conditions for the people of Myanmar. We have no influence over the Myanmar governments budget, but we do urge greater transparency concerning oil and gas revenues. The working conditions we offer and our requirements for contractors can have a positive ripple effect. Through training and contracting with local businesses, we have broadened the pool of skills and expertise available in the country at a faster pace. Thanks to initiatives implemented since 1995, the 50,000 people in the Yadana pipeline area now enjoy better health, higher incomes and a brighter future for their children. Allow outside scrutiny and take constructive criticism to heart. We regularly compare our approach to that of independent qualified experts, to improve our practices. Specialists from the U.S. non-profit CDA Collaborative Learning Projects, for example, have visited Myanmar five separate times since 2002. Their reports are available to the public at www.cdainc.com. Open to scrutiny by international institutions, diplomats, NGOs and local partners, Total E&P Myanmar hosted more than 100 visitors in 2009. Promote best practice sharing. We are committed to sharing our strategic vision of local development, workplace rights and land acquisition procedures with other companies operating in the country. Among the first byproducts of the initiative to share best practices that we introduced in 2008, the local subsidiaries of Total, Petronas, PTTEP and Daewoo regularly discuss their respective community outreach projects.

TOTAL / 53

Acting as a role model for ethics and human rights


In Myanmar, the strict application by both Total and our partners and contractors of the principles of our Code of Conduct addressing fundamental rights, transparency, integrity and the rejection of all forms of corruption requires unagging vigilance and commitment.
ARTICULATING OUR REQUIREMENTS AND CONSTANTLY UPGRADING OUR PROCESS
In 2009, a new Burmese-language version of our Code of Conduct reafrmed and explained our rules of professional conduct, both internally and to our partners. More than 50 Total E&P Myanmar (TEPM) employees responsible for security and local development completed an advanced course organized by an independent institution. The class was designed to improve their understanding of human rights issues and give them the tools and resources needed to more effectively monitor compliance with our standards. In addition to the ethical assessment of TEPM conducted in 2007 by the independent consultant GoodCorporation, International Labour Organization (ILO) representatives visited the pipeline area in 2009 and had an opportunity to talk with communities and review the subsidiarys actions.

PREVENTING HUMAN RIGHTS ABUSES IN THE PIPELINE AREA


Total employees and facilities in the Yadana pipeline area are protected by unarmed civilian security ofcers, most of them recruited from neighboring villages, who are supervised by an expatriate contract employee. Constant communication with villagers enables our teams to respond quickly in the event of abuses. As a sovereign country, Myanmar is responsible for enforcing law and order, and the national army was stationed in the pipeline area before our arrival in late 1994. We have no contractual relationship with the army, nor do we give it instructions, nor do we pay it. We have always reminded the authorities, either directly or through national oil company MOGE, of the unacceptability of forced labor and we work to prevent it from occurring in our sphere of activities.

Yadana Project
Total operates the offshore Yadana gas field through our subsidiary Total E&P Myanmar (TEPM), with partners Unocal (a Chevron subsidiary), Thailands PTTEP and state-owned MOGE of Myanmar. The original memorandum of understanding for the project was signed in 1992 and the contract will expire in 2028. Over $1 billion was invested during the construction phase from 1995 to 1998. Production averaged 18 million cubic meters of gas per day in 2009, with Myanmar accounting for 0.6% of our total output. Around 15% of Yadanas gas is earmarked for domestic consumption in Myanmar. The remainder is exported to Thailand, where it is used to generate 20% of that countrys power.

54 / Environment and Society Report 2009

Myanmar

A human resources process unlike any other in the country


Developing local talent and creating an attractive working environment are priorities in Myanmar, as in all our host countries.
DEVELOPING SKILLS AND CREATING MORE OPPORTUNITIES
TEPM and its contractors currently employ about 900 people, 95% of them Myanmar nationals, while a growing proportion of management positions are held by locals. As well, 19 Myanmar employees are assigned to Totals headquarters or other subsidiaries so that they can upgrade their qualications. Some $10 million was allocated to initial employee training during the construction phase. Today, the annual training budget is about $800,000 a year. TEPMs human resources process is unique in the country, though typical for us. It includes career management plans, a framework to promote dialogue with employees through elected representatives, the 2009 Total Survey of employee satisfaction, an attractive compensation policy and expanded healthcare, retirement, life and disability insurance benets. And we work closely with our contractors to ensure they apply similar principles.

In an effort to optimize the Yadana Suboo program introduced in 1997, Total works closely with specialists from Entrepreneurs du Monde, a French NGO focused on microfinance. Involved in crafting the lending policy and training local teams, its experts go out into the field three times a year to check that the program is operating smoothly. Currently, there are about 1,200 outstanding loans. The repayment rate exceeds 90%, and monthly interest rates were reduced in early 2010. For the most part, it is the poorest families that benefit, accounting for 67% of borrowers. Cemented by the creation of Village Banking Committees, the initiative recently added a savings program, which was trialed in four villages in 2009.

THAILAND
Most of the 410-kilometer Yadana gas export pipeline lies offshore, with 63 kilometers onshore in southern Myanmar. Nearly 50,000 people of diverse ethnic origins and religions live in this rural region. We can fully exercise our commitment to human rights in the pipeline area, where we also have a socioeconomic program covering 25 villages.

Pipeline area
5 km

MYANMAR

MYANMAR
Villages covered by the program Gas pipeline Roads

Yadana

TOTAL / 55

Permanently improving the living conditions of neighboring communities


Faced with the scale of needs, we are taking steps to open up villages through public health, education and infrastructure initiatives. With economic development, they are the main focuses of a program conducted with the active participation of our stakeholders.
FOCUSING ON ALL ASPECTS OF DEVELOPMENT
The program deployed in the pipeline area is based on two principles that are cornerstones of our community development process. The rst is maintaining dialogue with the people concerned and their elected representatives to dene the scope of projects. And the second is strengthening individual and collective capabilities through targeted, sustainable initiatives. Introduced in 1995, when the pipeline area numbered 35,000 residents, the program now concerns around 50,000 people in all. The mortality rate from malaria, contaminated water or food, and acute respiratory infections fell by 95% between 1997 and 2009. This was achieved by combining preventive initiatives, such as providing health education and mosquito repellent, with treatment actions that include setting up village clinics and introducing an

emergency medical response system. Efforts focus on prevention and maternal and child health in particular. Along with a revamped micronance program, initiatives to improve residents incomes include teaching them more efcient farming and livestock production methods, having veterinarians monitor herds and, in 2009, opening a second, cooperatively managed Village Agriculture Input Store.

STELLAR RESULTS IN IMPROVING ACCESS TO EDUCATION


More than 9,000 children and adolescents twice as many as in 1995 have access to education in the pipeline area, thanks to the construction of 44 schools and the renovation of another 22, the provision of nancial assistance to 340 teachers, the creation of libraries and the supply of teaching materials. In addition, the average number of students per class has fallen to 26 from 46. The authorities are responsible for course content and teacher appointments, but it was Totals initiative to create a remedial program to tackle low academic achievement. In 2009, 52% of the students enrolled in the program passed the secondary school graduation examination, signicantly higher than the national average. TEPM also helps students from the pipeline area to pursue their education at universities, providing grants and scholarships. At the computer school opened in Kanbauk, classes are taught by a young graduate of this system.

Ten new basic infrastructure projects were completed in 2009, including bridges, schools, clinics and drinking water supply systems, bringing their total number to more than 200 since 1995. Now, whenever possible and when security conditions allow, development projects are managed by communities and implemented by local businesses.

56 / Environment and Society Report 2009

Myanmar

Helping to prepare the countrys future


Nationally, we focus on areas we consider priorities for the future of the country, namely strengthening the public health system and promoting good governance.
A COMMITMENT TO ADVANCING PUBLIC HEALTH
The Myanmar pilot program for the integrated care of patients with both tuberculosis and HIV/AIDS began in 2005. It has administered antiretroviral therapy to more than 2,300 patients. Financed by the Yadana consortium and conducted jointly with the International Union against Tuberculosis and Lung Disease and the Myanmar Health Ministry, the program currently covers about 1.5 million people in the Mandalay region and the city of Pakokku. At end-2009, Total and the other Yadana project partners pledged to donate $4 million over the period 2010-2014 enough to nance antiretroviral drugs for 2,000 patients for ve years. In 2008, the Global Business Coalition on HIV/AIDS, Tuberculosis and Malaria (GBC) commended the initiative, which may be duplicated in other countries. We also show our commitment to public health by training Myanmar physicians in France in how to ght HIV/AIDS and by providing logistical assistance to Association Mdicale Franco-Asiatique (AMFA), a group that focuses on training medical personnel.

TOTAL WORKS WITH THE U.N. TO EDUCATE PUBLIC OFFICIALS ABOUT GOOD GOVERNANCE
We want to help Myanmar government ofcials who may ultimately rise to high-level positions move closer to international standards. In late 2009, three years after an initial course, 30 participants from 11 ministries learned about human rights, humanitarian, refugee, maritime and environmental law, the United Nations system and multilateral relations at a seminar jointly organized by the United Nations Institute for Training and Research (UNITAR) and the Myanmar Ministry of Foreign Affairs, with TEPMs nancial support. Total sees this as another way we can help the United Nations open up the country and bring it back into the international community.

More than

100,000
cataract surgeries have been performed nationwide since 2001, under the blindness prevention program deployed by the NGO Helen Keller International, which receives $250,000 in donations from the Yadana partners annually.
Following Cyclone Nargis in 2008, TEPM contributed to the relief effort in many ways, including a $2-million donation to the Red Cross and Red Crescent. Our teams continue to closely monitor revitalization efforts in the affected areas.

TOTAL / 57

Q10
Given the absence of government regulations to enforce cumulative limits to protect the air, land and water, how will Total ensure that their oil sands projects do not contribute to adverse cumulative environmental effects?
MARLO RAYNOLDS

Executive Director of the Pembina Institute, a Canadian ENGO that promotes sustainable energy solutions through innovative research, education, consulting and advocacy

Oil Sands

Answer: Oil sands development requires special precautions and a range of environmentally efcient technologies. Our operations will not begin until 2017. That gives us time to incorporate innovative, economically achievable solutions to mitigate the cumulative environmental effects, in a manner that will be transparent for our stakeholders. We have for a number of years been exploring various avenues of improvement. These include reducing water withdrawals by optimizing recycling, scaling back the physical footprint and size of tailings ponds, enhancing the energy efciency of all processes to curb carbon emissions, and accelerating reclamation by taking into account the characteristics of Canadas boreal forest.

170 5%

billion

barrels of proved reserves, putting Canada in second place after Saudi Arabia, and equivalent to ve years of global production.

250,000 CAD4
million

barrels per day (Totals share): estimated production level of Totals oil sands assets by 2020.

share of Canadas overall greenhouse gas emissions that are linked to current oil sands production.

invested thus far to support neighboring communities.

Our objectives and guiding principles


Lay the groundwork for the responsible development of oil sands, a vast untapped resource vital for meeting energy demand in the coming decades. Leverage our position as a newcomer in the eld to use the best available technologies in the coming years, before the projects we manage come on stream. Integrate innovative solutions into our projects, thanks to the steady technological progress the industry has been making in the last 40 years. Tap into the expertise of the Calgary Research Centre and our global R&D network to optimize our environmental performance. Specically, that means respecting the natural environment and biodiversity, reclaiming land, treating wastewater, reducing water and energy use and limiting greenhouse gas emissions, in particular through carbon capture and storage. Commit to working transparently and in concert with local communities, authorities and all other stakeholders. Create as many benets as possible for our host communities, by respecting their culture, meeting their expectations and promoting local business development and employment opportunities.

TOTAL / 59

Long-term goals for responsible resource development


While we are still at the conceptual and basic engineering stages of our operated projects, we are using this planning phase to develop technologies that will minimize environmental impacts during operation.
2020 HORIZON
Total Exploration & Production Canadas (TEPCA) portfolio of projects is at an early stage of development. One of our major investments is a 50% interest in the Surmont project, as a non-operating partner. This Steam Assisted Gravity Drainage (SAGD) project is currently in Phase 1 of operations and is yielding approximately 22,000 barrels per day of bitumen. In January 2010, we announced sanction of the Phase 2 expansion, which is expected to yield a combined 110,000 barrels per day with production startup in 2015. TEPCA also operates the Joslyn lease with a 75% interest. Located north of Fort McMurray, the lease covers an area of approximately 221 square kilometers. The main project is the Joslyn North Mine (JNM). TEPCA also has a 50% interest in the Northern Lights mining project, which is currently being integrated into its overall oil sands portfolio as a long-term investment. We now have a signicant position in the oil sands and by 2020 expect to produce up to 250,000 barrels per day. We also plan to build an upgrader to add value to the production of the Joslyn, Surmont and other leases. The proposed upgrader, which will process the bitumen into lighter oil, would be located in the designated Industrial Heartland area northeast of Edmonton, Alberta.

Reducing greenhouse gas emissions: a major challenge


Increasing energy efciency and assessing the best options for carbon capture and storage (CCS) are two major priorities for our research teams.
Oil sands greenhouse gas emissions are approximately 45 kilograms per barrel in mining and 70 kilograms per barrel for in situ processes. Although that is two to three times as much as from conventional crude production, two independent studies in 2009 showed that carbon intensity per barrel only exceeds that of conventional crude used in North America by 5 to 15% when taking into account well to wheels the whole life cycle from extraction to nal use. Emissions reduction remains an absolute imperative for Total, particularly through improving energy efciency. Several projects are being explored in tandem. Among them are a pilot of an Expanding Solvent-Steam Assisted Gravity Drainage (ES-SAGD) hybrid process at Surmont, the cogeneration of steam and electricity for our Joslyn North Mine, and the evaluation of the potential of other steam generation processes.

POOLING OUR RESEARCH EFFORTS TO ACCELERATE THE USE OF CARBON CAPTURE AND STORAGE
TEPCA takes an active part in the work of the Integrated CO2 Network (ICO2N), whose main objective is to frame policy, provide analysis, and prepare integrated CCS solutions for Alberta. TEPCA is also part of the Alberta Saline Aquifer Project (ASAP), the Wabamun Area CO2 Sequestration Project (WASP) and, since early 2010, the Heartland Area Redwater Project (HARP) Phase 2. TEPCA aims to complement the lessons drawn from our Lacq pilot in France.

$20 MILLION DEVOTED ANNUALLY TO RESEARCH PARTNERSHIPS


With the exception of Surmont, all of TEPCAs major projects will commence operations after 2017, giving us another seven years to improve performance in key areas of oil sands exploration and production compared to todays standards. In connection with the Total R&D network, the Calgary Research Centre has worked since 2006 on all lines of optimization, including environmental protection, resource management, and in situ and mining processes.

60 / Environment and Society Report 2009

Oil Sands

OIL SANDS AT A GLANCE


Located in the Athabasca region of Western Canada, oil sands are a naturally occurring mixture of thick, heavy oil, water and sand. The heavy oil, known as bitumen, does not ow under natural conditions. The hydrocarbons that they contain are xed at the temperature of the deposits, 11C on average. Techniques very different from those employed elsewhere in our industry are necessary to extract and develop them.
Mining: 20% of the oil sands resource

MINING
Mining shovels dig into sand and load it into huge trucks. Trucks take oil sands to crushers, where it is prepared for extraction.

In situ: 80% of the oil sands resource

Bitumen is extracted from the oil sands slurry during hydrotransport and in the separation vessels.

Hot water is added to the oil sands and then fed via hydrotransport to the extraction plant.

The tailings are pumped to the settling basin, where the water is recycled.

IN SITU Cyclic Steam Stimulation


Stage 1 Steam injection Stage 2 Soak phase Stage 3 Production

Steam Assisted Gravity Drainage


Surface wellhead

Steam injected into the reservoir.

Steam and groundwater heat the viscous oil.

Heated oil and water are pumped to the surface. Steam chamber Steam injection

Oil

Source: Canadian Association of Petroleum Producers, September 2009 (www.capp.ca).

Extraction techniques: mining and in situ Two types of recovery methods are used in the oil sands. Deposits close to the surface are mined, while resources more than 80 meters below the surface require in-place, or in situ, recovery. In mining, shovels excavate the oil sand and load it into huge trucks. The mined ore passes through crushers, where it is prepared for extraction. Hot water is added to create an oil sand slurry. This is fed via pipeline to the extraction plant, where bitumen is extracted in separation vessels. Separating bitumen from sand and water results in tailings, which are pumped to ponds, where water is recovered and recycled.

In situ recovery works by injecting energy into the reservoir to uidize and produce the bitumen. Two main techniques are currently used. One is Cyclic Steam Stimulation (CCS), which alternates between injecting steam into a well and, after letting the heat soak in, pumping out the bitumen through the same vertical well, in cycles of several weeks. The other is Steam Assisted Gravity Drainage (SAGD), a process that continuously injects steam through an upper horizontal well, then pumps the bitumen out through a second horizontal well about ve meters lower than the rst. The option chosen depends essentially on the reservoirs properties.

TOTAL / 61

Optimizing water and tailings management


Our efforts are directed at safeguarding water resources, maximizing recycling and reducing our tailings.
All available process water at the Joslyn North Mine will be reused in order to limit the removal of freshwater from the Athabasca River. Up to 80% of water needs for extraction and utilities will be covered by recycled water; only 20% by river water and collection from run-off. The mine will also be designed to have off-stream water storage with a capacity of 90 days storage, which is the largest in the region, reducing dependency on the river water during low ow conditions in winter.

Our objective is to develop the Joslyn North Mine as one of the most environmentally responsible projects in the Athabasca.

Reclaiming land as quickly as possible


From the initial deforestation to the nal certication, we seek to accelerate reclamation with solutions adapted to the particular ecosystem of the boreal forest.
PLANNING BEFOREHAND, SO THAT NATURE CAN GRADUALLY REASSERT ITS RIGHTS
TEPCA is committed to reestablishing both upland and wetland areas in the Joslyn North Mine reclaimed landscape and has planned accordingly. Topsoil removed will be stored and its self-regenerating capabilities will be stimulated so that it can be reused during reclamation. With that in mind, we are working with a number of expert organizations, including the Canadian Oil Sands Network for Research and Development (CONRAD). Within CONRAD, the Environmental and Reclamation Research Group (ERRG) has a suite of research initiatives targeted at understanding the various functions and species of the boreal forest ecosystem and determining the best reclamation techniques. TEPCA is also working with the Alberta Biodiversity Monitoring Institute (ABMI) on its provincial monitoring program.

REDUCING THE SIZE OF TAILINGS PONDS


Managing tailings water, sand, clay and hydrocarbon particles is a major challenge faced by mining operations. We have made tailings management a priority. Tailings settle in ponds before water treatment and recycling take place. The Joslyn North Mine will use a segregated tailings management process. Using sand beaching and thickened tailings as its base, our tailings management approach will improve water recycling and allow for faster, progressive reclamation of the land than found in older, conventional tailings management models. As a result, reclamation of the land will occur in years rather than decades.

Bitumen and extra-heavy crude oil: a resource needed to meet rising demand
Bitumen and extra-heavy oils global resources are estimated at 600 billion recoverable barrels and located mainly in North and South America. With nearly 170 billion barrels of proved reserves, Canadas oil sands make up a signicant share of the total. By 2025, the aggregate output drawn from Canadian oil sands could reach 3 million to 3.5 million barrels per day.

530
square kilometers: as of today, the surface covered by oil sands mining development in the Athabasca region. The potential of the development considered is 4,800 square kilometers in total, representing 0.1% of Canadas boreal forest.

62 / Environment and Society Report 2009

Oil Sands

Supporting local communities


In Canada, as elsewhere, open dialogue with stakeholders and engagement with neighboring communities are critical to our corporate culture and operations.
RESPECTING THE PAST, PREPARING FOR THE FUTURE
The safeguarding of the culture and rights of First Nations and Mtis communities is one of our highest priorities not only to help preserve a priceless heritage, but also to ensure that our plans are developed in a respectful, mutually benecial manner over the long term.

we learn from SRM + will help us continue supporting local communities even more effectively.

A question for

JIM BOUCHER Chief of the Fort McKay First Nation How can we ensure that oil sands development delivers lasting benets for First Nations peoples? First Nations peoples have been occupying their lands, or traditional territories, for tens of thousands of years. They are people of the land, stewarding the resources which they have depended upon for their survival in harmony with the seasons. Over a short period of time, the last 40 years, the landscape has changed in the Athabasca Oil Sands area. This area overlaps with the traditional lands of Fort McKay, placing the Community in the center of oil sands activity. The area, once dominated by boreal forest, muskeg, wildlife and berries, is now also home to expansive oil sands mines and SAGD developments, tailings ponds and accompanying infrastructure. Community members continue to hunt, trap, sh and collect berries and medicinal plants but are doing so in an environment threatened by impacts from industrial activity. It is the goal of Fort McKay leadership to ensure that the impacts posed by oil sands development does not outweigh the benets of being neighbors to big industry. In Fort McKay we take our relationship with industry very seriously. A good, solid relationship based on trust and shared goals allows

A CONTINUOUS PROCESS OF INFORMATION, DIALOGUE AND DISCUSSION


TEPCA is one of many oil sands operators that participate in discussions with First Nations Industry Relations Corporations (IRC). The IRCs have a mandate to build relationships with industry so First Nations communities can benet from oil sands development. The IRCs are also a vehicle to advocate on behalf of First Nations in matters relating to environmental protection and social and economic development. We also participate actively in policy and project initiatives through various industry and multi-stakeholder forums, including the Fort Air Partnership, the Integrated CO2 Network (ICO2N), the Cumulative Environmental Management Association (CEMA), CONRAD, the Oil Sands Leadership Initiative (OSLI), the Alberta Biodiversity Monitoring Institute (ABMI), the Wood Buffalo Environmental Association (WBEA), the Regional Aquatics Monitoring Program (RAMP) and the Oil Sands Developers Group (OSDG).

both the Community and Industry to live side by side to work together to minimize the impacts to the environment while maximizing the benets of developing the oil sands in a responsible manner. We expect our neighbors to be transparent in their dealings with us, to provide us with timely information about their activities to enable us to respond, to involve us at their early planning stages through to monitoring and eventual reclamation and closure. To embrace our traditional environmental knowledge as well as our entrepreneurship and business aptitude. To ensure lasting benets, industry must invest in the communities in which they reside. To invest means that there is an honest commitment to develop the resource responsibly, make use of local labor pools, build capacity to be meaningfully engaged, joint venture where opportunities exist, have a presence in the community and build long-lasting relationships with the community at every level.

PRIORITIZING OUR ACTIONS


In 2009, TEPCA implemented the Total-developed Stakeholder Relationship Management + (SRM +) process for both the Joslyn North Mine and the upgrader project. SRM + maps stakeholder expectations and has highlighted areas of focus for TEPCA, such as local content, contracts and procurement, and employment opportunities. TEPCA has already made signicant educational and youth skills training investments throughout Alberta. What

TOTAL / 63

OUR MAIN OBJECTIVES

Environment
Flaring reduction in Exploration & Production: in 2014

Safety
Total recordable injury rate

50%
from 2005

25%

over four years in 2013 from the 2009 target TRIR

Hydrocarbon discharges in water

< 30 ppm
Energy efciency

Human resources
Non-French executives

offshore and less than 10 ppm inshore in 2010

25%
Recruitment

in 2010

a year between 2007 and 2012 in Exploration & Production and Petrochemicals and +1% a year in Rening Reduction in sulfur dioxide emissions by reneries

+2% 20%
Certication

8,000 12%

new hires worldwide, of which 1,500 in France Women executives in 2010

in 2010 from 2004

of environmentally sensitive sites, as dened in the Reporting Scope and Method section, certied ISO 14001 in 2012

100%

64 / Environment and Society Report 2009

2009 PERFORMANCE INDICATORS

Total is included in the main socially responsible investing indexes.

Total has been included in the DJSI World Index since 2004 and the DJSI Europe Index since 2005. These indexes are based on the cooperation of Swiss asset manager SAM. Total was the 2009/2010 DJSI Oil & Gas supersector leader.

Total has been included in French rating agency Vigeos ASPI Index since 2004.

Total has been a constituent company to the FTSE4Good Index Series since 2001. The index is calculated by the global index provider, FTSE Group.

Total was included in the Carbon Disclosure Leadership Index in 2006, 2007 and 2009.

TOTAL / 65

2009 PERFORMANCE INDICATORS

Reporting scope and method


PROTOCOLS
Totals reporting procedures consist of: For environmental indicators and greenhouse gases, two Corporate Reporting Protocols, along with instructions specic to the businesses. For industrial safety indicators, the Corporate Guidelines on Event and Statistics Reporting. For social indicators, a practical handbook entitled Corporate Social Reporting Protocol and Method. These handbooks are available to all Total subsidiaries. Abridged versions of the environment and social reporting handbooks can be downloaded from the Total Web site. The complete versions can be consulted at corporate headquarters, in the relevant departments.

Social reporting is based on two resources the Global Workforce Analysis and the Worldwide Human Resources Survey (WHRS). The Global Workforce Analysis is conducted twice a year, on June 30 and December 31, in all fully consolidated companies owned 50% or more and included in the Registration Document. The survey covers worldwide workforces, hiring under permanent and xed-term contracts, nationality, and employee hires and departures, to produce a breakdown of the workforce by gender, category (managers and non-managers), age and nationality. The Worldwide Human Resources Survey (WHRS) is an annual survey that comprises 91 indicators in addition to those used in the Global Workforce Analysis. The indicators are selected in cooperation with the businesses and cover major components of our human resources policy, such as mobility, career management, training, employee dialogue, Code of Conduct application, health, compensation, retirement benets and insurance. The survey covers a representative sample of 92 consolidated companies with 68,943 employees. The statistics in this report are taken from the most recent survey, conducted in December 2009 and January 2010. A total of 92 companies accounting for 72% of the consolidated workforce and operating in 39 countries responded. Both surveys are conducted using the Enablon application, introduced at end-2003, and undergo similar internal control and validation processes. Consolidation method Environmental, industrial safety and social data are fully consolidated in these scopes. Changes in scope Changes in scope are taken into account on the date they take effect. However, because environmental parameters are expressed in absolute values, all historical parameters are restated as of the year an asset is divested or acquired. Where relevant, data from previous years is recalculated in line with the new scope of consolidation, to facilitate like-for-like comparisons.

SCOPE
In 2009, environmental reporting covered all Total-operated Upstream, Downstream and Chemicals sites at December 31, 2009. The 2009 reporting questionnaire was completed by 906 production sites, or 99% of the total. The data published in this report cover greenhouse gases, chronic and accidental emissions and discharges to the air and water, the amount of freshwater withdrawn from and discharged into the natural environment, waste and certain data related to energy and site management systems. The ISO 14001 certication target given in this report covers environmentally sensitive sites that account for 90% of the main indicators for each business, including air emissions and freshwater withdrawals. Safety reporting covers all Total employees, as well as employees of contractors with a specic volume of work at Group-operated sites or under contract to Total. Each site submits its reporting to the relevant business unit. The data are then consolidated at the business level and, every month, at the corporate level. In 2009, the Group safety reporting scope covered 454,671,000 hours worked, equivalent to around 267,500 people.

66 / Environment and Society Report 2009

PRINCIPLES
Indicator selection and relevance The data published in this report are intended to inform stakeholders about Totals corporate social responsibility performance for the year in question. The indicators consist of corporate performance indicators tracked by the Corporate Affairs Department and the principal indicators in the International Petroleum Industry Environmental Conservation Associations (IPIECA) Oil and Gas Industry Guidance on Voluntary Sustainability Reporting. The indicators have been selected to track: Totals commitments and policies (safety management systems, environmental management systems, etc.). Performance relative to Totals principal challenges and impacts. The effects of Totals social policies. Legislative and regulatory obligations, such as those stipulated in Frances New Business Regulations (NRE) Act. Terminology used in social reporting Management staff refers to any employee whose job level is the equivalent of 300 or more Hay points. Managed scope: All subsidiaries in which one or more Group companies own a stake of 50% or more, or 512 companies in 133 countries. Consolidated scope: All subsidiaries fully consolidated as in the Registration Document, or 340 companies and 96,387 employees. Methods The methods may be adjusted to reect the diversity of Totals activities, recent consolidation of subsidiaries, lack of standardized international regulations or denitions, practical procedures for collecting data, or changes in methods.

Continuous improvement of processes Marketing and Specialties, which make only a minor contribution to certain indicators, have nonetheless introduced a gradual process of consolidating Group indicators. An update of their actual contribution is underway. There have been no signicant changes to the denitions of environmental and social performance indicators. Consolidation and internal controls Environmental, social and industrial safety data are consolidated and checked by each business unit and business and then at corporate level. Data pertaining to certain specic indicators are calculated directly by the businesses. These processes are regularly audited internally. External opinion For the fth year in a row, Total elected to have its main environmental and social performance indicators audited. These indicators are identied by the symbol in the 2009 Environment and Society Report table of indicators. External audits are performed at the Group and business level, as well as in a sample of business units in and outside France, selected each year in line with their relative contribution to the Group totals, previous years results and a risk analysis. The auditors independence is dened by legislation and the French Rules of Professional Conduct for Statutory Auditors.

Aggregate percentage of units covered by external audits of environmental and social indicators ENVIRONMENTAL INDICATORS
Greenhouse gas emissions Percentage of units covered NOx emissions SO2 emissions Total hazardous waste treated offsite Freshwater withdrawals excluding once-through cooling water

SOCIAL INDICATORS
Workforce Number of training days Number of sick days

2005 2006 2007 2008 2009 Aggregate, 2005-2009

26% 22% 21% 36% 33% 92%

19% 24% 19% 23% 19% 87%

18% 27% 30% 17% 32% 84%

27% 8% 9% 24% 19% 58%

N/A N/A N/A 29% 17% 46%

14% 14% 17% 10% 10% 49%

17% 22% 27% 28% 11% 78%

18% 19% 25% 15% 16% 71%

TOTAL / 67

2009 PERFORMANCE INDICATORS

Assurance report
on certain environmental and social performance indicators
At Totals request, we have performed a review that allowed us to provide a moderate level of assurance on all meaningful aspects of certain environmental and social performance data selected by Total (the data(1)) for 2009, identied in this report by the symbol . The data were prepared in accordance with:

The Corporate Environmental Performance Reporting Guideline and the Corporate Greenhouse Gas Emissions Reporting Guideline. The procedures used to conduct the Worldwide Human Resources Survey and the twice-yearly Global Workforce Analysis. Hereinafter the Reference Procedures. Two Corporate Affairs departments were responsible for preparing the performance data and establishing the respective Reference Procedures: the Sustainable Development and Environment Department for environmental performance and the Corporate Human Resources Department for social performance. The Reference Procedures can be consulted at Totals headquarters and are described in part on pages 66 and 67. It is our responsibility to express an opinion of this data, based on our review, which was conducted in line with the professional standards applicable in France and the International Standard on Assurance Engagement (ISAE 3000), published in December 2003. Our independence is dened by French legislation and regulations and the French Rules of Professional Conduct for Statutory Auditors. Our opinion concerns the relevant data only, not the complete Environment and Society Report.

subsidiaries(2) for the environmental indicators and nine sites and subsidiaries(3) for the social data, in line with their activity, their contribution to the consolidated data for the Group, their location and the ndings of our previous reviews. For these sites and units, we veried understanding and application of the Reference Procedures and, on a test basis, veried the calculations and reconciled data with the supporting documentation. Our review covered 17 to 33% of the consolidated environmental data for Total and 10% of the consolidated workforce for social data.

COMMENTS ON THE REFERENCE PROCEDURES


We bring the following comments on the reporting process to your attention. Totals Reference Procedures appropriately describe the reporting scope, indicators, steps and schedule, as well as the roles and responsibilities of the participants. They are updated annually and distributed in English and French to the various participants. Environmental reporting The corporate Reference Procedures are cascaded to each business and segment, which adjust the reporting process to Totals various activities. This year, Total has introduced a reporting tool that should improve the reliability of consolidation at the corporate level. Data checks by the Gas & Power segment and some Marketing and Chemicals consolidation sub-levels need to be strengthened. One Chemicals units reporting tool does not cover all data related to air emissions. The Gas & Power segment needs to increase the frequency at which it measures fugitive methane emissions to make the reported data more reliable. In the Rening segment, sites could periodically review the scope of air emissions to ensure it reects changes to facilities. Because of an industrial accident, the audit of Total Rafnerie Mitteldeutschland GmbH could not be conducted on site and was based solely on documents. Social reporting Totals social reporting is based on a reporting application deployed at all units in the relevant scope. This application has made social data collection more reliable, in particular by automating checks and during consolidation. For the sick days indicator, we noted that certain units audited did not clearly understand the types of absence considered and the methods used to count them. The audit of data for Total Rafnerie Mitteldeutschland GmbH only considered site workforce indicators.

NATURE AND SCOPE OF THE REVIEW


We performed a limited review, described below, to provide a moderate level of assurance that the selected data are free of material misstatement. A higher level of assurance would have required a more extensive review. We reviewed the Reference Procedures with regard to their relevance, reliability, understandability and completeness. We met with the persons in charge of environmental and social reporting at the corporate level and in the Exploration & Production, Gas & Power, Rening & Marketing and Chemicals businesses to verify compliance with the Reference Procedures. We assessed the risk of material misstatement and relevance, performed an analytical review and veried, on a test basis, the calculations and data consolidation. As part of our review, we selected a sample of 12 sites and

68 / Environment and Society Report 2009

OPINION
On the basis of our review, nothing has come to our attention that causes us to believe that the reviewed indicators have not, in all material respects, been prepared in accordance with the Reference Procedures.

Paris-La Dfense April 16, 2010

Statutory Auditors

KPMG Audit A department of KPMG S.A.

ERNST & YOUNG AUDIT

Jay Nirsimloo Partner

Philippe Arnaud Partner Manager of the Environment & Sustainable Development Department

Pascal Macioce Partner

Eric Duvaud Partner Manager of the Environment & Sustainable Development Department

(1) Environmental performance indicators: greenhouse gas emissions (CO2, N2O, CH4, HFC, PFC, SF6 ), SO2, NOx, hazardous waste production treated offsite, freshwater withdrawals excluding once-through cooling water. Social performance indicators: workforce (by age, manager/non-manager, gender), hires, departures and balance, French and non-French managers, number of training days, guaranteed minimum wage, regular medical checkups, number of sick days, employee representatives, annual performance review for managers and non-managers. (2) Exploration & Production: subsidiaries Total E&P Nigeria, Total E&P UK and Total E&P ABK in Abu Dhabi; Gas & Power: CDFE Montoir site in France; Rening: Total Rafnerie Mitteldeutschland GmbH in Germany and the Donges and Flandres reneries in France; Marketing Europe: the Preston bitumen plant in the United Kingdom; Specialty Chemicals in Northern, Central and Western Europe, C.I.S., and Central and Latin America: Nowy Dwor Mazowiecki lubricants plant in Poland; Chemicals: the Total Petrochemicals sites in Carling, France, Hutchinsons Zywiec I site in Poland and Atotechs Feucht site in Germany. (3) Exploration & Production: subsidiaries Total E&P Nigeria and Total E&P UK; Gas & Power: Total Gas & Power Ltd in the United Kingdom; Rening: Total Rafnerie Mitteldeutschland GmbH in Germany; Marketing Africa-Middle East: Total Nigeria; Marketing Europe: Total UK Ltd; Chemicals: Hutchinson Poland, Atotech Deutschland GmbH in Germany, and Bostik S.A. in France.

TOTAL / 69

2009 PERFORMANCE INDICATORS

Economic
Unit

2007
158,752 23,956 12,231 12,203 5.37 2.07 27 24 31 17,686 11,722 1,556

2008
179,976 28,114 13,961 13,920 6.20 2.28 23 26 32 18,669 13,640 2,585

2009
131,327 14,154 7,607 7,784 3.48 2.28 27 13 16 12,360 13,349 3,081

Sales Adjusted operating income from business segments(1) Adjusted net operating income from business segments(1) Adjusted net income (Group share)(1) Adjusted fully-diluted earnings per share(1) (2) Dividend per share(3) Net debt-to-equity (at December 31) Return on Average Capital Employed (ROACE)(4) Return on equity Cash ow from operating activities Capital expenditure Divestitures at selling price

M M M M % % % M M M

(1) Net income using replacement cost, adjusted for special items and excluding Totals share of amortization of intangibles related to the Sano-Aventis merger and, from 2009, selected items related to Sano-Aventis. (2) Based on the average weighted diluted shares outstanding during the year. (3) Subject to approval at the Annual Shareholders Meeting on May 21, 2010. (4) Calculated based on adjusted net operating income and average capital employed, using replacement cost.

Environment
Unit

2007
803 95 235 37 92 106

2008
910 97 252 41 98 113

2009
916 99 286 61 110 115 89

Operated sites Sites that responded to the environmental reporting questionnaire ISO 14001-certied sites of which: Upstream Downstream Chemicals ISO 14001-certied environmentally sensitive sites

number % number

Six greenhouse gases of which: Upstream Downstream Chemicals Primary energy consumption of which: Upstream Downstream Chemicals Flaring and venting

MTCDE/year

59.2 27.4 23.3 8.5

57.3 26.8 23.0 7.5 641 150.8 364.6 125.7 6,072

55.1 26.9 22.0 6.2 608 155.3 340.6 112.5 6,072

MGJ/year

646 140.7 365.9 139.4 6,627

metric ktoe/year

Audited indicators that obtained a moderate level of assurance from Ernst & Young and KPMG.

70 / Environment and Society Report 2009

Unit

2007
148.4 65.1 80.3 3.0 90.4 58.6 23.6 8.2 139.6 97.1 15.2 17.2 10.1

2008
136.2 53.7 79.6 2.9 91.7 62.8 21.7 7.2 131.2 91.3 15.2 15.4 9.3

2009
129.8 60.4 67.1 2.3 92.0 64.3 21.8 5.9 134.7 99.3 14.6 12.9 7.9

SO2 emissions of which: Upstream Downstream Chemicals NOx emissions of which: Upstream Downstream Chemicals Non-methane VOC emissions of which: Upstream Rening Marketing Chemicals

metric ktons/year

metric ktons/year

metric ktons/year

Freshwater withdrawal (excluding once-through cooling water) Discharges (excluding once-through cooling water) Hydrocarbon discharges in efuent of which: Downstream and Chemicals Upstream Exploration & Production Suspended solids discharges Chemical oxygen demand (COD)

Mcu. m/year Mcu. m/year metric tons/year metric tons/year metric tons/year ppm metric tons/year metric tons/year

160.6 156.7 1,532 144.4 1,388 27 1,193 6,304

150.8 157.9 1,549 118.2 1,431 27 1,189 5,742

147.6 154.9 1,356 112.4 1,244 23 1,124 5,429

Hazardous waste production (treated offsite) of which: Hazardous waste from routine operations of which: Upstream Downstream Chemicals of which: Special waste

metric ktons/year metric ktons/year

metric ktons/year

335.5 263.2 23.2 133.6 106.4 72.3

345.0 261.1 30.4 135.0 95.7 83.9

291.1 235.4 19.2 124.0 92.2 55.7

Oil spills of which: Upstream Downstream Chemicals

number cubic meters

766 2,474 281 2,022 171

461 7,419 4,983 2,413 23

472 2,409 433 1,957 19

Audited indicators that obtained a moderate level of assurance from Ernst & Young and KPMG.

TOTAL / 71

2009 PERFORMANCE INDICATORS

Social
Unit

2007

2008

2009

WORKFORCE Consolidated scope Workforce by region France Europe excluding France Africa North America South America Asia Other(1) Total(2) Workforce by manager/non-manager Managers of which senior executives Non-managers
number

37,296 27,374 8,022 7,905 6,330 8,311 1,204 96,442


number

37,101 27,495 8,237 7,379 6,574 8,733 1,440 96,959 25,397 320 71,562 96,959 7 13 15 14 14 13 13 9 2 0

36,407 26,299 8,648 6,845 6,923 9,795 1,470 96,387 26,149 308 70,238 96,387 7 12 15 15 14 13 13 9 2 0

Total(2)
Workforce by age bracket(3) Under 25 25-29 30-34 35-39 40-44 45-49 50-54 55-59 60-64 65 and over EMPLOYMENT Consolidated scope Permanent hires by region France Europe excluding France Africa North America South America Asia Other(1)
% %

24,742 325 71,700 96,442 7 12 15 15 14 13 13 9 2 0

17 24 10 12 21 14 2

18 22 9 10 22 15 4

14 29 10 8 19 17 3

(1) Other: Middle East, French overseas departments and territories, Pacic. (2) Paints business divested in February 2003. (3) Data for ve-year periods from 2004 and ten-year periods in 2002 and 2003. Audited indicators that obtained a moderate level of assurance from Ernst & Young and KPMG.

72 / Environment and Society Report 2009

Unit

2007

2008

2009

DIVERSITY Consolidated scope Percentage women in workforce Percentage women in total workforce Percentage women managers Percentage women senior executives Percentage women in permanent hires Percentage women in permanent manager hires Percentage non-French nationals in workforce Percentage total workforce Percentage managers Percentage non-French nationals in hires Percentage permanent hires Percentage permanent contract manager hires Nationalities represented at Total HEALTH Worldwide Human Resources Survey scope Percentage Group companies that offer employees regular medical checkups % WORKING HOURS Worldwide Human Resources Survey scope Percentage employees who can opt to work part time BENEFITS Worldwide Human Resources Survey scope Percentage employees with death benets > 200% of gross salary EMPLOYEE DIALOGUE Worldwide Human Resources Survey scope Percentage companies with employee representation Percentage employees covered by a collective bargaining agreement Collective bargaining agreements CAREER MANAGEMENT Worldwide Human Resources Survey scope Percentage Group companies with an annual performance review system For managers For non-managers Total Average length of time in a position Less than 3 years 3 to 5 years 6 to 8 years More than 8 years Average
Audited indicators that obtained a moderate level of assurance from Ernst & Young and KPMG.

29 21 8.6 31 25
%

29 22 10.6 31 29 62 58 82 69 133

30 22 12 32 26 63 58 85 69 132

62 57
%

83 72
number

133

98

98

98

83

82

81

74

77

80

% % number

86 75 164

87 74 166

87 74 178

98.9 97.8 99.0


%

98.9 97.8 98.4 43 19 14 24 5 years

98.9 97.8 98.4 44 18 13 25 5 years

41 21 15 23 4 years

TOTAL / 73

2009 PERFORMANCE INDICATORS

Safety
Unit

2007
2.4 0.8 1.8 2.58 4.17 4.2 2.4 2.7 3.2 7.7 15 0.034

2008
2.1 0.6 2.1 2.5 3.6 3.6 2.2 2.1 2.9 6.5 8 0.018

2009
1.9 0.6 1.00 2.4 3.1 3.1 1.9 1.8 2.9 5 21 0.046

Lost time injury rate (Total + contractor employees) LTIR of which: Exploration & Production Gas & Power Rening & Marketing Chemicals Total recordable injury rate (Total + contractor employees) TRIR of which: Exploration & Production Gas & Power Rening & Marketing Chemicals Fatalities Fatalities per million hours worked (Total + contractor employees)

number

number

number number

Community
Unit

2007
124.5 79.5 2,759 N/A N/A

2008
151 87.5 2,619 17 N/A

2009
210 91.15 2,234 19.4 12.5

Community development spending Community development spending in non-OECD countries Number of initiatives Total Foundation + corporate philanthropy spending French Community Development Fund for Youth

M % number M M

Other indicators are available at www.total.com.

74 / Environment and Society Report 2009

IPIECA index

2009 PERFORMANCE INDICATORS

In preparing our Environment and Society Report, we refer primarily to the International Petroleum Industry Environmental Conservation Association (IPIECA)/American Petroleum Institute (API) guidance, which is specic to the oil industry. To see a comparison with the Global Reporting Initiative (GRI), go to www.total.com.

Economic
Governments ECO1 ECOA1 Shareholders ECO2 Employees ECOA2 Suppliers & Contractors ECO3 Lenders & Holders of Debt Securities ECOA3 Tax Expenses Transparency of Payments Dividends Paid Plus Share Repurchases Payroll and Benets Capital Expenditures Interest Paid

Go to Q08 Q06, Q08 Introduction + Indicators Introduction + Indicators Introduction Registration Document

Environmental
Spills and Discharges ENV1 ENV2 ENVA1 ENVA2 ENVA3 ENVA4 ENVA5 ENV3 ENV4 ENVA6 ENV5 ENVA7 ENVA8 ENV6 ENVA9 Hydrocarbon Spills to the Environment Controlled Discharges to Water Other Spills and Accidental Releases Other Efuent Discharges Hazardous Waste Non-Hazardous Waste Recycled, Reused or Reclaimed Materials Greenhouse Gas Emissions Flared and Vented Gas Other Operational Air Emissions Energy Use Freshwater Use New and Renewable Energy Sources Environmental Management Systems Biodiversity Q07, Q10 + Indicators Q07 + Indicators Q07 + Indicators Indicators Q07 + Indicators Indicator not reported Indicator not reported Q02 + Indicators Q02 + Indicators Q07 + Indicators Q02 + Indicators Q07 + Indicators Indicator not reported Q07 + Indicators Q07

Waste and Residual Materials

Emissions

Resource Use

Other Environmental Indicators

Health and Safety


H&S1 H&S2 H&S3 H&S4 H&S5 Health and Safety Management Systems Employee Participation Workforce Health Occupational Injury and Illness Rates Product-Related Health Risks Q05 Q05 + Indicators Web site Q05 + Indicators Web site

Social
Human Rights Business Ethics SOC1 SOC2 SOC3 SOCA1 SOC4 SOCA2 SOC5 SOC6 SOCA3 SOC7 SOC8 SOCA4 SOCA5 SOCA6 SOCA7 SOC9 Human Rights Bribery and Corruption Political Contributions Political Lobbying and Advocacy Non-Discrimination and Equal Opportunity Employee Satisfaction Training and Development Non-Retaliation and Grievance System Local Employment Opportunities Labor Practices Community Relationships Social Investments External Capacity Building Indigenous Communities Resettlement and Land Right Security Q06, Q09 Q06 Web site Web site Q04 + Indicators Q04 + Indicators Web site Q06 Q08 Q06 Q08 Q08 + Indicators Q08 Q06, Q10 Web site Q06

Employment Practices

Community & Society

TOTAL / 75

TO LEARN MORE

www.total.com

http://foundation.total.com

www.total.com, Global Compact section


Since 2002, the ten principles of the U.N. Global Compact have served as templates for Totals corporate social responsibility initiatives and accomplishments. For more detailed information on our commitments and actions, go to the U.N. Global Compact page on our Web site.

You can learn more and the latest about each of our commitments and actions on our Web site. To let us know what you think and ask other questions, you can go to the Contact section of our Web site.

Created in 1992, the Total Foundation focuses on three core aspects of corporate philanthropy: community support and health, the environment and biodiversity, and culture and heritage. You can nd out about the Foundations projects, conducted in partnership with associations, institutions and NGOs, and about initiatives by Total employees on the Total Foundation Web site.

ILLUSTRATIONS: O. Charbonnel. PHOTO CREDITS: E. Caupeil/Myop S. Lavou/Myop M. Weiss M. Labelle L. Pascal T. Gonzales P. Livermore M. Roussel E. Follet C. Pirotte P. Boulen B. Blaise IPSOS Airstar M. Dufour U.N. Global Compact/Transparency International, 2009 L. Zylberman I. MacDonald (by courtesy of TAMU) Maersk P. Schaff O. Robinet (by courtesy of TIGF) G. Gauret Total All rights reserved. Total S.A. May 2010 EDITORIAL CONSULTANT: le bureau des mots DESIGN AND PRODUCTION:

Imprim vert

Printed on Oxygen Silk (also marketed as Satimat Green) satin-coated, chlorine-free, wood-free paper manufactured from 60% recycled bers and 40% FSC-approved virgin bers.

With EcoFolio, Total is encouraging paper recycling. Sort your trash, protect the environment. www.ecofolio.fr

76 / Environment and Society Report 2009

We would like to sincerely thank the stakeholders who shared their questions and stories in this report. We would also like to thank everyone at Total who helped to prepare the report. We welcome your comments at total.com to continue this frank and open dialogue.

TOTAL S.A. Headquarters: 2 place Jean Millier, La Dfense 6 92400 Courbevoie, France Tel.: +33 (0)1 47 44 45 46 Share capital: 5,871,057,210 Registered in Nanterre: RCS 542 051 180 www.total.com

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