Total wrote off $7bn of oil sands in one quarter, then quit Canada entirely by 2023

Total entered Canada's oil sands in the mid-2000s and assembled stakes in three mines and one thermal project: Joslyn (38.25%), Fort Hills (24.6%), Northern Lights and the Surmont steam project (50%). For years it kept scaling up even as every rival's project went over budget — by 2018 a Canadian Press analysis found Total was producing more oil sands barrels than any other foreign company in Alberta.

The problems never stopped compounding. Joslyn's mine expansion was put on hold indefinitely in 2014 as costs ballooned, and in 2018 Total sold the whole project to Canadian Natural Resources for just C$225 million — $100 million cash plus $25 million a year for five years. Total trimmed its Fort Hills stake in 2017, but kept Fort Hills and Surmont on the books.

The reckoning came with half-year results on 29 July 2020. Total announced it was writing off US$7 billion (C$9.3 billion) of oil sands assets — $7.3 billion tied to its 24.6% of Fort Hills and 50% of Surmont, plus $2 billion of other oil sands holdings — and, in the same breath, $1.07 billion on Australian LNG. The company said reserves with high production costs that would only be produced more than 20 years out were now 'stranded' given its carbon-reduction targets, and quit the Canadian Association of Petroleum Producers over 'misalignment' with its climate stance.

The exit then completed through the buyers' market. In April 2023 Suncor agreed to buy Total's Canadian business for about C$5.5 billion, but ConocoPhillips exercised its right of first refusal and took the 50% of Surmont for up to C$4.4 billion (about US$3 billion); Suncor settled for Total's ~31% of Fort Hills at C$1.47 billion (US$1.07 billion). With the Fort Hills sale closing at the end of 2023, Total was fully out of Canadian oil sands — at a fraction of what the position cost to build.

US$7bn (C$9.3bn) written off in one quarter: $7.3bn on Fort Hills/Surmont, $2bn other oil sands, $1.07bn Australian LNG; Joslyn sold for C$225M

Total paid boom-era prices for projects whose economics needed sustained high oil prices and decades of production; both assumptions failed within five years of each other.

Joslyn's 2014 indefinite halt was the warning that the flagship growth projects would not be built as planned, yet Total kept the rest of the portfolio at pre-crash carrying values.

The May 2020 climate ambition reset reclassified long-dated, high-cost reserves as stranded, converting an accounting problem into an immediate US$7 billion charge.

The COVID-19 oil-price collapse of spring 2020 removed the last excuse for delay and forced the entire repricing into a single quarter.

Quitting CAPP signalled the decision was strategic, not cosmetic — Total wanted out of the asset class, not just off the liability.

High-cost, long-dated assets run on two clocks: the commodity cycle and climate policy. Total carried its oil sands past the first clock breaking in 2014 — the second made the write-off bigger.

Total's exit reshaped the oil sands it left: ConocoPhillips swallowed Surmont outright after bumping Suncor's agreed deal, and Suncor took Total's Fort Hills stake to feed bitumen to its Base Plant upgraders. The 2020 charge landed alongside peers' writedowns — Suncor took C$1.38 billion on its 54.1% of Fort Hills and Teck C$474 million on its 21.3% two months earlier — while Deutsche Bank and HSBC already barred financing new oil sands projects. CAPP's CEO called Total's pivot to Africa, Brazil and the Middle East 'disappointing'; Alberta's energy minister called it 'highly hypocritical'.