Total, Qatar warn oil contractors on high costs

PARIS, April 5 (Reuters) – French oil major Total and Qatar’s energy minister on Thursday both warned service contractors they risked damaging the energy industry unless they moderated their fees.

Total Chief Executive Christophe de Margerie told an industry conference the level of price increases for hiring drilling rigs and building gas production facilities was unjustified, even allowing for tightness in the supply of the contractors’ inputs.


“A nice message to our dear contractors: We all know that you are facing difficult times … but we are also under strong constraints, especially because of the price of oil,” the CEO said.

“Just be careful. We just cannot continue with a more than 30 percent (cost) increase per year. It is not justified…and it’s becoming close to the level of (the) cost of projects, which might push, not companies, but states to delay projects.”

Reuters