In 2001, the Downstream environment was in a down cycle compared with the previous year, especially as regards refining margins. Synergies and productivity programs reaching about 0,7 billion euros compensated almost all of the adverse effects of the economic environment. Downstream operating income, excluding non-recurring items, was down 4% from the previous year, at 3 billion euros.

Refining Marketing

Western Europe
The Group's networks came together under the Total banner in the UK, the Netherlands, Luxembourg, Germany, Belgium and Italy ... In France, asset disposal commitments made to the European Commission within the scope of the TotalFina-Elf Aquitaine merger were completed ... AGIP acquired 74 of the Group's service stations, including three highway stations, as part of measures taken to optimize the network ... TotalFinaElf acquired Air Liquide's 50% stake in the liquefied petroleum gas (LPG) marketing company operated by both companies, thereby stepping into second place in that market in France ... Construction of a cogeneration plant began at the TotalFinaElf refinery site in Gonfreville l'Orcher, Normandy. The plant will produce 375 metric tons of steam per hour and will have an electrical generating capacity of 260 MW. The plant's production will supply the refinery and the neighboring Atofina petrochemical complex. TotalFinaElf has a 25% stake in the project ... In Italy, 40 highway service stations were acquired from ENI.

Central Europe
Market share increased incrementally with the opening of nine new service stations.

Mediterranean Basin
TotalFinaElf acquired 100% of Total Oil Turkiye, a subsidiary that markets petroleum products in Turkey, when it bought out the 49% stake still held by a partner. The Group now operates a network of 330 service stations in that country.

Africa
In Zambia, the Group is in the process of acquiring the refining and marketing assets of Agip Zambia, including a 50% interest in the Indeni refinery, 20 service stations, a fuel storage depot and a stake in a lubricant manufacturing plant. Total's network would increase to 50 service stations for a market share approaching 15%.

North America
In the US, the Group sold off all its holdings in Ultramar Diamond Shamrock ... An agreement was signed with Delphi Automotive Systems, the world's leading car equipment manufacturer, on research and testing in the field of solid oxide fuel cells. The work will be performed in Delphi's laboratories in Rochester and in TotalFinaElf's R&D centers in Europe.

Asia
In China, an agreement was signed with China Merchants to pool the LPG activities of both partners. With an estimated volume of 200,000 metric tons in 2002, the joint venture has become the leading LPG distributor in a high-growth region ... In Pakistan, growth was spurred with a $20 million investment for the creation of a petroleum product distribution network.

Trading & Shipping

TotalFinaElf is one of the world's major traders of crude oil and refined petroleum products, dealing extensively in physical, forward and futures markets. The tightness in world oil markets eased considerably over the course of 2001. A deteriorating economic environment and recent high oil prices combined to reduce growth in world oil demand to near stagnation. During this volatile period, TotalFinaElf's trading division maintained a high level of activity, with physical volumes of crude oil and refined products in excess of 5 Mb/d being traded in 2001.
2001 was a year of contrasts for the oil chartering market, for both crude and refined products shipping. Freight rates began the year at record highs but slid through most of 2001 to end the year at near record lows. At the end of the year, freight rates were at their lowest levels since 1999. Fleet renewal and modernization continued. Accordingly, for crude oil transport two new Suezmax vessels ("Erviken" and "Storviken") and two new Aframax vessels ("Nord Atlantic" and "Nord Stealth") entered into the fleet. For product transport, TotalFinaElf took three vessels on long-term charter ("Kersaint", "Marne", "Charente") destined to replace older units.
After the wreck of the Erika in 1999, TotalFinaElf issued more stringent criteria for selecting chartered ships. Furthermore, the Group advocates the adoption of a more stringent regulatory framework by the relevant authorities.