$TOT CEO Patrick Pouyanne had some really interesting things to say about renewables, returns and the challenges ahead.

He acknowledged the most difficult thing to understand on renewables since entering has been what level of returns they can expect. Feel comfortable now (1/x)

$TOT has approved >10 GW of projects recently across the globe and all have 10% returns. Given that they can borrow @ 2%, he says this is ~equivalent to what O&G targeted when he entered the business -- 15% returns with 5-6% borrowing costs. (2/X)

$TOT argues they are better able to assess good/viable projects because of their global footprint and deploying teams on the ground. They also bid what they feel comfortable with and are fine walking away if not competitive. (3/X)

Still, the capital needed for the energy transition is stunning. Generally speaking, it takes ~$100bn to build out renewables capacity equivalent to 1mn boe/d. For O&G, that capacity would cost $30-$50bn (lower in Mideast). Low cost of capital is essential. (4/X)

On CCS, he noted that $TOT would never have invested in the Northern Lights project in Norway w/o government help. And that help is huge -- Norway is covering 70-80% of the phase I costs. Biggest challenge for CCS is limited carbon customers + storage often not near source (end)