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21 Oct, 2014 13:27

An oil maverick with a mustache: Business legacy of Christophe de Margerie in Russia

An oil maverick with a mustache: Business legacy of Christophe de Margerie in Russia

Sanctions against Russia are counterproductive and stability should be restored to provide more investment to the country, Total CEO Christophe de Margerie said during his last speech in Moscow before he died in a plane crash.

In his 40 years at the French company de Margerie forged close links with Russia, recently calling to continue “business as usual” and "not to build new Berlin walls.”

He will be remembered for his colorful character and his ability to break into markets regardless of politics.

“In general I’m against sanctions. I’ve repeated this many times. You heard that. And I’ve become not very popular in my country as I was often blamed for promoting our own interests. I don’t like sanctions as such because I think they are both unfair and counterproductive,” Christophe de Margerie told the Consulting Council on Foreign Investment into Russia hours before his death.

He stressed that political issues should have political solutions and businesses shouldn’t suffer.

“If we want to maintain stable and long-term inflow of foreign investment into Russia, we must restore a stable and peaceful economic area between Russia and other countries,” the Total boss said.

VIDEO: Christophe de Margerie comments on sanctions at St. Petersburg Economic Forum in May

Total SA is France's second-biggest listed company, with a market value of €102 billion, as well as one of the top foreign investors in Russia.

De Margerie was an ardent advocate of strong relations with Russia. In 2013, his company sourced about 9 percent of its oil and gas from the country which is Total’s fourth largest market.

“Can we live without Russian gas in Europe? The answer is no. Are there any reasons to live without it? I think – and I'm not defending the interests of Total in Russia – it is a no,” he told Reuters during the summer.

Under de Margerie’s tenure, Total acquired 18 percent of Novatek, Russia’s second largest gas producer, which was affected in the previous round of US sanctions. Total is linked with Novatek, as well as CNPC in the $27 billion Yamal LNG project in north-west Siberia.

Total CEO Christophe de Margerie with Russian President Vladimir Putin in Paris on June 11, 2010. (AFP Photo / RIA Novosti / Pool / Alexei Nikolsky)

"This is a loss not only for France, which lost a great citizen, this is a great loss to Russia,” co-owner of Novatek, Gennady Timchenko, said.

“Christophe deeply understood and appreciated Russia, and did tremendous work to bring the two countries closer. No matter how difficult the situation was around him, he always stayed calm, didn’t fall behind the market, and always defended his position,” Timchenko said.

Aleksey Kudrin, who served as Russia’s finance minister from 2000 to 2011, said that de Margerie "did a lot to attract investment to Russia."

“What are we doing here in Russia? Working with Russian companies to develop new technological projects for the benefit of all and bringing clients energy as cheaply as possible,” de Margerie said at the St. Petersburg investment forum in May.

In September, Total was forced to halt a project with independent oil producer Lukoil on a shale hydrocarbon project in the Bazhenov reserve in Siberia.

Russian Energy Minister Aleksandr Novak called Total a reliable partner to Russian companies, which it has carried out expensive and complex projects.

Petro-Dollar opponent

Christophe de Margerie recently expressed his support for a wider use of other currencies in transactions outside the US – for oil purchases in particular – after the scandal involving France’s largest bank, BNP Paribas, which was slapped with a record $9 billion fine and a year’s dollar trading ban.

“Nothing prevents anyone from paying for oil in euro,” de Margerie said in July. “The price of a barrel of oil is quoted in dollars. A refinery can take that price and using the euro-dollar exchange rate on any given day, agree to make the payment in euro.”

The US and OPEC countries have traded oil exclusively in US dollars since 1971.