Exhibit 99.1

EX-99.1 2 dex991.htm EXHIBIT 99.1 Exhibit 99.1

Exhibit 99.1

OPERATING AND FINANCIAL REVIEW AND PROSPECTS

The financial information in this Form 6-K concerning TOTAL S.A. (“TOTAL”) and its subsidiaries and affiliates (collectively, the “Group”) with respect to the second quarter and first six months ended June 30, 2011, has been derived from TOTAL’s unaudited consolidated financial statements for the second quarter and first six months ended June 30, 2011.

The following discussion should be read in conjunction with the unaudited interim consolidated financial statements and the related notes provided elsewhere in this Form 6-K and with the information, including the audited financial statements and related notes, for the year ended December 31, 2010, in TOTAL’s Annual Report on Form 20-F for the year ended December 31, 2010, filed with the Securities and Exchange Commission on March 28, 2011.

•

Key figures and consolidated accounts of TOTAL*


2Q11		1Q11		2Q10		2Q11 vs 2Q10			in millions of euros except earnings per share and number of shares	1H11		1H10		1H11 vs 1H10
	45,009		46,029		41,329		+9	%	Sales		91,038		78,932		+15	%
									Adjusted net operating income from business segments
	2,457		2,849		2,203		+12	%	• Upstream		5,306		4,174		+27	%
	197		276		483		-59	%	• Downstream		473		638		-26	%
	247		238		274		-10	%	• Chemicals		485		431		+13	%
	1.21		1.75		1.38		-12	%	Fully-diluted earnings per share (euros)		2.96		2.55		+16	%
	2,255.5		2,251.1		2,242.5		+1	%	Fully-diluted weighted-average shares (millions)		2,252.3		2,242.6		—
	2,726		3,946		3,101		-12	%	Net income (Group share)		6,672		5,714		+17	%
	7,570		5,683		3,446		x2.2		Investments **		13,253		7,155		+85	%
	1,338		663		850		+57	%	Divestments		2,001		1,898		+5	%
	6,232		5,020		2,596		x2.4		Net investments		11,252		5,257		x2.1
	5,064		5,714		4,942		+2	%	Cash flow from operations		10,778		10,202		+6	%

Adjusted net operating income is defined as income using replacement cost, adjusted for special items affecting operating income and excluding the impact of changes for fair value from January 1, 2011, and, through June 30, 2010, excluding TOTAL’s equity share of adjustments related to Sanofi. See “Analysis of business segment results” below for further details.

**	Including acquisitions.

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Second quarter 2011 results

> Sales

In the second quarter 2011, the Brent price averaged 117 $/b, an increase of 50% compared to the second quarter 2010 and 11% compared to the first quarter 2011. The European refining margin indicator (ERMI) averaged 16.3 $/t, a decrease of 48% compared to the second quarter 2010 and 34% compared to the first quarter 2011. The environment for the petrochemicals and specialty chemicals remained satisfactory.

The euro-dollar exchange rate averaged 1.44 $/€ in the second quarter 2011, 1.27 $/€ in the second quarter 2010 and 1.37 $/€ in the first quarter 2011. Expressed in euros, the Brent price averaged 81.3 €/b, an increase of 32% compared to the second quarter 2010.

In this environment, sales were €45,009 million in the second quarter 2011, an increase of 9% compared to €41,329 million in the second quarter 2010.

> Net income

Reported net income (Group share) in the second quarter 2011 decreased by 12% to €2,726 million from €3,101 million in the second quarter 2010, mainly due to weak Downstream segment results and the variation of the after-tax inventory valuation effect on the Downstream segment’s results more than offsetting the impact of increased hydrocarbon prices on the Upstream segment’s results. The after-tax inventory valuation effect (as defined below under “Analysis of business segment results”) had a negative impact on net income (Group share) of €74 million in the second quarter 2011 and a positive impact of €169 million in the second quarter 2010. As from January 1, 2011, the Group accounts for changes in fair value of trading inventories and storage contracts (as defined below under “Analysis of business segment results”). The changes in fair value had a negative impact on net income (Group share) of €41 million in the second quarter 2011. Special items had a positive impact on net income (Group share) of €47 million in the second quarter 2011 and a positive impact of €11 million in the second quarter 2010. Effective July 1, 2010, the Group no longer accounts for its interest in Sanofi as an equity affiliate, but treats such interest as a financial asset available for sale in the line “Other investments” of the balance sheet. In the second quarter 2011, the Group received dividend income of €115 million after taxes from Sanofi. In the second quarter 2010, the contribution to the Group’s net income from its interest in Sanofi was €101 million. In the second quarter 2010, the Group’s share of adjustment items related to Sanofi had a negative impact on net income (Group share) of €40 million.

Fully-diluted earnings per share, based on 2,255.5 million fully-diluted weighted-average shares, was €1.21 in the second quarter 2011 compared to €1.38 in the second quarter 2010, a decrease of 12%.

> Investments — divestments¹

Investments, excluding acquisitions and including changes in non-current loans, were €3.5 billion in the second quarter 2011 compared to €3.1 billion in the second quarter 2010.

Acquisitions were €4.0 billion in the second quarter 2011, comprised essentially of the acquisition of 12% of Novatek and 60% of SunPower.

Asset sales in the second quarter 2011 were €1.2 billion, including mainly the Group’s interest in its Cameroon E&P subsidiary, part of the Joslyn project in Canada and the sale of Sanofi shares.

Net investments² were €6.2 billion in the second quarter 2011 compared to €2.6 billion in the second quarter 2010.

> Cash flow

Cash flow from operations was €5,064 million in the second quarter 2011 compared to €4,942 million in the second quarter 2010. Cash flow from operating activities was affected by changes in oil and oil products prices on the Group’s working capital requirement. As IFRS rules account for inventories of petroleum products according to the FIFO method, an increase in oil and oil products prices at the end of the relevant period compared to the beginning of the same period generates, all other factors remaining equal, an increase in inventories and accounts receivable net of an increase in accounts payable, resulting in an increase in working capital requirements. Similarly, a decrease in oil and oil products prices generates a decrease in working capital requirements.

The Group’s net cash flow³ was negative €1,168 million in the second quarter 2011 compared to positive €2,346 million in the second quarter 2010, reflecting essentially the significant level of acquisitions finalized during the quarter.

•

First half 2011 results

> Sales

Compared to the first half 2010, the average Brent price increased by 44% to 111.1 $/b. The European refining margin indicator (ERMI) averaged 20.4 $/t compared to 30.4 $/t in the first half 2010. The environment for the petrochemicals and specialty chemicals remained generally favorable.

The euro-dollar exchange rate averaged 1.40 $/€ compared to 1.33 $/€ in the first half 2010. Expressed in euros, the Brent price averaged 79.2 €/b, an increase of 36% compared to the second half 2010.

In this environment, sales in the first half 2011 were €91,038 million, an increase of 15% compared to €78,932 million in the first half 2010.

> Net income (Group share)

Reported net income (Group share) in the first half 2011 increased by 17% to €6,672 million from €5,714 million in the first half 2010, mainly due to the impact of the increase in hydrocarbon prices on the Upstream segment’s results. The after-tax inventory effect had a positive impact on net income (Group share) of €872 million in the first half 2011 and a positive impact of €513 million in the first half 2010, in each case due to the increase in prices of oil and oil products. Special items had a negative impact on net income (Group share) of €120 million in the first half 2011, comprised essentially of the increase in the deferred tax liability due to the change in UK taxes, and a positive impact of €25 million in the first half 2010. In the first half 2011, the Group received dividend income of €115 million after taxes from Sanofi. In the first half 2010, the contribution to the Group’s net income from its interest in Sanofi was €209 million. In the first half 2010, the Group’s share of adjustment items related to Sanofi had a negative impact on net income (Group share) of €81 million.

¹	Detail shown on page 11 of this exhibit.

²	Net investments = investments including acquisitions and changes in non-current loans – asset sales.

³	Net cash flow = cash flow from operations - net investments.

The Group did not buy back shares in the first half 2011. On June 30, 2011, there were 2,258.3 million fully-diluted shares compared to 2,243.6 on June 30, 2010.

Fully-diluted earnings per share, based on 2,252.3 million weighted-average shares, was €2.96 in the first half 2011 compared to €2.55 in the first half 2010, an increase of 16%.

> Investments — divestments⁴

Investments, excluding acquisitions and including changes in non-current loans, were €6.3 billion in the first half 2011 compared to €5.5 billion in the first half 2010.

Acquisitions were €6.5 billion in the first half 2011, comprised essentially of the acquisition of interests in Fort Hills and Voyageur in Canada, an additional 7.5% interest in the GLNG project in Australia, a 12% stake in Novatek and 60% of SunPower.

Asset sales in the first half 2011 were €1.5 billion, essentially comprised of sales of Sanofi shares, the Group’s interest in its Cameroon E&P subsidiary and part of the Joslyn project in Canada.

Net investments were €11.3 billion in the first half 2011, compared to €5.3 billion in the first half 2010.

> Cash flow

Cash flow from operations was €10,778 million in the first half 2011, an increase of 6% compared to the first half 2010. Cash flow from operating activities was affected by changes in oil and oil products prices on the Group’s working capital requirement. As IFRS rules account for inventories of petroleum products according to the FIFO method, an increase in oil and oil products prices at the end of the relevant period compared to the beginning of the same period generates, all other factors remaining equal, an increase in inventories and accounts receivable net of an increase in accounts payable, resulting in an increase in working capital requirements. Similarly, a decrease in oil and oil products prices generates a decrease in working capital requirements.

The Group’s net cash flow was negative €474 million in the first half 2011 compared to positive €4,945 million in the first half 2010, reflecting essentially the significant level of acquisitions finalized during the first half 2011.

The net-debt-to-equity ratio was 24.3% on June 30, 2011, compared to 22.7% on June 30, 2010⁵, in line with the Group’s target range.

•

Analysis of business segment results

The financial information for each business segment is reported on the same basis as that used internally by the chief operating decision maker in assessing segment performance and the allocation of segment resources. Due to their particular nature or significance, certain transactions qualified as “special items” are excluded from the business segment figures. In general, special items relate to transactions that are significant, infrequent or unusual. However, in certain instances, certain transactions such as restructuring costs or asset disposals, which are not considered to be representative of the normal course of business, may be qualified as special items although they may have occurred in prior years or are likely to recur in following years.

In accordance with IAS 2, the Group values inventories of petroleum products in the financial statements according to the FIFO (First-In, First-Out) method and other inventories using the weighted-average cost method. Under the FIFO method, the cost of inventory is based on the historic cost of acquisition or manufacture rather than the current replacement cost. In volatile energy markets, this can have a significant distorting effect on the reported income. Accordingly, the adjusted results of the Downstream segment and Chemicals segment are presented according to the replacement cost method in order to facilitate the comparability of the Group’s results with those of its competitors and to help illustrate the operating performance of these segments excluding the impact of oil price changes on the replacement of inventories. In the replacement cost method, which approximates the LIFO (Last-In, First-Out) method, the variation of inventory values in the statement of income is, depending on the nature of the inventory, determined using either the month-end prices differential between one period and another or the average prices of the period. The inventory valuation effect is the difference between the results according to FIFO and the replacement cost.

As from January 1, 2011, the effect of changes in fair value presented as an adjustment item reflects for some transactions differences between internal measures of performance used by TOTAL’s management and the accounting for these transactions under IFRS. IFRS requires that trading inventories be recorded at their fair value using period-end spot prices. In order to best reflect the management of economic exposure through derivative transactions, internal indicators used to measure performance include valuations of trading inventories based on forward prices. Furthermore, TOTAL, in its trading activities, enters into storage contracts, future effects of which are recorded at fair value in the Group’s internal economic performance. IFRS precludes recognition of this fair value effect.

Until June 30, 2010, the Group also adjusted for its equity share of adjustment items related to Sanofi. As of July 1, 2010, Sanofi is no longer accounted for as an equity affiliate (but is instead treated as a financial asset available for sale in the line “Other investments” of the balance sheet).

⁴	Detail shown on page 11 of this exhibit.

⁵	Detail shown on page 11 of this exhibit.

The adjusted business segment results (adjusted operating income and adjusted net operating income) are defined as replacement cost results, adjusted for special items, excluding the effect of changes in fair value as from January 1, 2011. For further information on the adjustments affecting operating income on a segment-by-segment basis, and for a reconciliation of segment figures to figures reported in the Company’s consolidated interim financial statements, see pages 22-29, 32-34 and 40-45 of this exhibit.

In addition, the Group measures performance at the segment level on the basis of net operating income and adjusted net operating income. Net operating income comprises operating income of the relevant segment after deducting the amortization and the depreciation of intangible assets other than leasehold rights, translation adjustments and gains or losses on the sale of assets, as well as all other income and expenses related to capital employed (dividends from non-consolidated companies, income from equity affiliates, capitalized interest expenses), and after income taxes applicable to the above. The income and expenses not included in net operating income that are included in net income are only interest expenses related to long-term liabilities net of interest earned on cash and cash equivalents, after applicable income taxes (net cost of net debt and minority interests). Adjusted net operating income excludes the effect of the adjustments (special items and the inventory valuation effect) described above.

Upstream

> Environment — liquids and gas price realizations*

2Q11

1Q11

2Q10

2Q11 vs
2Q10

1H10

1H11 vs
1H10

117.0

105.4

78.2

+50%

Brent ($/b)

111.1

77.3

+44%

110.6

99.5

74.8

+48%

Average liquids price ($/b)

104.6

74.5

+40%

6.60

6.19

4.82

+37%

Average gas price ($/Mbtu)

6.39

4.94

+29%

76.9

71.7

54.8

+40%

Average hydrocarbons price ($/boe)

74.1

55.2

+34%

*	Consolidated subsidiaries, excluding fixed margin and buy-back contracts.

> Production


2Q11	1Q11		2Q10		2Q11 vs 2Q10		Hydrocarbon production	1H11		1H10		1H11 vs 1H10
2,311		2,371		2,359		-2%	Combined production (kboe/d)		2,341		2,393		-2%
1,197		1,293		1,327		-10%	• Liquids (kb/d)		1,245		1,350		-8%
6,077		5,880		5,549		+10%	• Gas (Mcf/d)		5,979		5,689		+5%

Hydrocarbon production was 2,311 thousand barrels of oil equivalent per day (kboe/d) in the second quarter 2011, a decrease of 2% compared to the second quarter 2010, essentially as a result of:

•

-3% for normal decline and scheduled maintenance, net of production ramp-ups on new projects;

•

+4.5% for changes in the portfolio, integrating net share of Novatek production and impact of various asset sales;

•

-2% for the price effect⁶;

•

-2.5% for disruptions related to security conditions, mainly in Libya; and

•

+1% for the end of OPEC reductions.

In the first half 2011, hydrocarbon production was 2,341 kboe/d, a decrease of 2% compared to the first half 2010, essentially as a result of:

•

-1.5% for normal decline and scheduled maintenance, net of production ramp-ups on new projects;

•

+2% for changes in the portfolio, integrating net share of Novatek production and impact of various asset sales;

•

-2% for the price effect;

•

-2% for disruptions related to security conditions, mainly in Libya; and

•

+1.5% for the end of OPEC reductions.

⁶	The “price effect” refers to the impact of changing hydrocarbon prices on entitlement volumes.

> Results


2Q11	1Q11			2Q10		2Q10 vs 2Q09			in millions of euros	1H11			1H10		1H11 vs 1H10
5,166		6,144			4,546		+14	%	Non-Group sales		11,310			9,115		+24	%
5,335		5,905			4,607		+16	%	Operating income		11,240			8,768		+28	%
55		(84	)		—		n/a		Adjustments affecting operating income		(29	)		—		n/a
5,390		5,821			4,607		+17	%	Adjusted operating income*		11,211			8,768		+28	%
2,457		2,849			2,203		+12	%	Adjusted net operating income*		5,306			4,174		+27	%
366		374			271		+35	%	• Includes income from equity affiliates		740			606		+22	%
6,868		5,232			2,723		x2.5		Investments		12,100			5,866		x2.1
921		335			174		x5.3		Divestments		1,256			261		x4.8
5,605		4,643			4,154		+35	%	Cash flow from operating activities		10,248			8,834		+16	%

*	Detail of adjustment items shown in business segment information starting on page 22 and on page 34 of this exhibit.

Adjusted net operating income from the Upstream segment was €2,457 million in the second quarter 2011 compared to €2,203 million in the second quarter 2010, an increase of 12%, reflecting mainly the increase in hydrocarbon prices.

Adjusted net operating income for the Upstream segment excludes special items. The exclusion of special items had a negative impact on Upstream adjusted net operating income of €76 million in the second quarter 2011 and a positive impact of €27 million in the second quarter 2010.

The effective tax rate for the Upstream segment was 61.6% compared to 58.3% in the second quarter 2010, essentially due to income contribution mix effects as well as higher UK petroleum taxes. The effective tax rate for the Upstream segment was 57.6% in the first quarter 2011.

Adjusted net operating income from the Upstream segment in the first half 2011 was €5,306 million compared to €4,174 million in the first half 2010, an increase of 27%, reflecting essentially the increase in hydrocarbon prices.

The return on average capital employed (ROACE⁷) for the Upstream segment was 21% for the twelve months ended June 30, 2011, compared to 22% for the twelve months ended March 31, 2011, and 21% for the full year 2010. The annualized second quarter 2011 ROACE for the Upstream segment was 22%.

Downstream

> Refinery throughput and utilization rates*


2Q11	1Q11		2Q10		2Q11 vs 2Q10		in millions of euros	1H11		1H10		1H11 vs 1H10
1,855		2,012		2,141		-13%	Total refinery throughput (kb/d)		1,934		2,067		-6%
692		745		784		-12%	• France		719		732		-2%
877		1,047		1,110		-21%	• Rest of Europe		962		1,080		-11%
286		220		247		+16%	• Rest of world		253		255		-1%
							Utilization rates**
75%		79%		78%			• Based on crude only		77%		75%
79%		85%		83%			• Based on crude and other feedstock		82%		80%

*	Includes share of CEPSA and, starting October 2010, of TotalErg.

**	Based on distillation capacity at the beginning of the year.

In the second quarter 2011, refinery throughput decreased by 13% compared to the second quarter 2010 and by 8% compared to the first quarter 2011, mainly due to scheduled turnarounds at the Grandpuits, Leuna and Antwerp refineries.

The utilization rate based on crude and other feedstock was 79% in the second quarter 2011 compared to 85% in the first quarter 2011 and 83% in the second quarter 2010.

In the first half 2011, refinery throughput decreased by 6% compared to the first half 2010, reflecting essentially the work at the Lindsey and Port Arthur refineries as well as the scheduled turnarounds in the second quarter.

⁷	Calculated based on adjusted net operating income and average capital employed, using replacement cost, as shown on page 12 of this exhibit.

> Results


2Q11		1Q11			2Q10		2Q11 vs 2Q10			in millions of euros (except ERMI refining margins)	1H11			1H10		1H11 vs 1H10
	16.3		24.6			31.2		-48	%	European refining margin indicator - ERMI ($/t)		20.4			30.4		-33	%
	34,551		34,769			32,190		+7	%	Non-Group sales		69,320			60,998		+14	%
	93		1,512	*		804		-88	%	Operating income		1,605			1,325		+21	%
	135		(1,226	)		255		-47	%	Adjustments affecting operating income		(1,091	)		585		n/a
	228		286			549		-58	%	Adjusted operating income**		514			740		-31	%
	197		276			483		-59	%	Adjusted net operating income**		473			638		-26	%
	23		24			44		-48	%	• Includes income from equity affiliates		47			58		-19	%
	462		264			562		-18	%	Investments		726			1,018		-29	%
	28		23			11		x2.5		Divestments		51			38		+34	%
	7		1,158			1,042		n/a		Cash flow from operating activities		1,165			1,496		-22	%

*	Corrected 1Q11 data.

**	Detail of adjustment items shown in business segment information starting on page 22 and on page 34 of this exhibit.

The European refining margin indicator (ERMI) averaged 16.3 $/t in the second quarter 2011, or approximately one-half of the 31.2 $/t average of the second quarter 2010.

Adjusted net operating income from the Downstream segment was €197 million in the second quarter 2011, compared to €483 million in the second quarter 2010.

Adjusted net operating income for the Downstream segment excludes any after-tax inventory valuation effect and special items. The exclusion of the inventory valuation effect had a positive impact on Downstream adjusted net operating income of €42 million in the second quarter 2011 and a negative impact of €195 million in the second quarter 2010. The exclusion of special items had a positive impact on Downstream adjusted net operating income of €45 million in the second quarter 2011 and no impact in the second quarter 2010.

Adjusted net operating income from the Downstream segment in the first half 2011 was €473 million, a decrease of 26% compared to the first half 2010. This decrease reflects essentially the unfavorable market conditions for refining and the reduced capacity of European refining during the second quarter due to maintenance.

The ROACE for the Downstream segment was 6% for the twelve months ended June 30, 2011, compared to 9% for the twelve months ended March 31, 2011, and 8% for the full year 2010. The annualized second quarter 2011 ROACE for the Downstream segment was 5%.

Chemicals


2Q11		1Q11			2Q10			2Q11 vs 2Q10			in millions of euros	1H11			1H10		1H11 vs 1H10
	5,291		5,105			4,589			+15	%	Non-Group sales		10,396			8,812		+18	%
	3,400		3,319			2,794			+22	%	• Base chemicals		6,719			5,326		+26	%
	1,891		1,786			1,784			+6	%	• Specialties		3,677			3,475		+6	%
	263		392			240			+10	%	Operating income		655			500		+31	%
	15		(130	)		(65	)		n/a		Adjustments affecting operating income		(115	)		41		n/a
	278		262			305			-9	%	Adjusted operating income*		540			459		+18	%
	247		238			274			-10	%	Adjusted net operating income*		485			431		+13	%
	132		119			149			-11	%	• Base chemicals		251			193		+30	%
	118		121			124			-5	%	• Specialties		239			241		-1	%
	209		171			144			+45	%	Investments		380			238		+60	%
	12		14			328			-96	%	Divestments		26			334		-92	%
	138		(144	)		477			-71	%	Cash flow from operating activities		(6	)		387		n/a

*	Detail of adjustment items shown in business segment information starting on page 22 and on page 34 of this exhibit.

In the second quarter 2011, the environment for Chemicals remained favorable, in line with the second quarter 2010.

Sales for the Chemical segment were €5.3 billion, an increase of 15% compared to the second quarter 2010.

The adjusted net operating income for the Chemicals segment in the second quarter 2011 was €247 million compared to €274 million in the second quarter 2010, which reflected strong petrochemical margins in Europe and the United States. Results for Specialty chemicals were in line with the strong results shown over recent quarters in a still favorable environment.

Adjusted net operating income for the Chemicals segment excludes any after-tax inventory valuation effect and special items. The exclusion of the inventory valuation effect had a positive impact on the Chemicals segment’s adjusted net operating income of €17 million in the second quarter 2011 and a positive impact of €25 million in the second quarter 2010. The exclusion of special items had a positive impact on the Chemicals segment’s adjusted net operating income of €66 million in the second quarter of 2011 and a negative impact of €4 million in the second quarter 2010.

In the first half 2011, adjusted net operating income for the Chemicals segment was €485 million compared to €431 million in the first half 2010. The increase reflects essentially the progress made by Base chemicals in a generally favorable environment with, in particular, an increased contribution from activities in Qatar.

The ROACE for the Chemicals segment was 12% for the twelve months ended June 30, 2011, stable compared to the twelve months ended March 31, 2011, and the full year 2010. The annualized second quarter 2011 ROACE for the Chemicals segment was 13%.

•

Summary and outlook

In October 2010, TOTAL announced that starting in 2011 the interim dividend would be paid on a quarterly basis. For the interim dividend related to the second quarter 2011, the Board of Directors at its meeting on July 28, 2011, decided to pay on December 22, 2011⁹ an interim dividend of €0.57 per share.

TOTAL announced that it would not seek a renewal of its Global Tax Consolidation status in France. Effective 2011, the Group will use the prevailing French tax law.

Since the start of the third quarter 2011, the Brent price has continued to trade around 110 $/b but the environment for European refining has remained difficult.

In the Upstream, while the first results from high-potential exploration wells are expected in the second half, the Group plans to sanction several major projects, notably in Australia and Russia, to pursue the development of major new producing areas. At the same time, the fourth quarter start-up of Pazflor in Angola is expected to contribute substantially to near-term production growth.

In the Downstream and Chemicals, the Group expects to benefit fully from its new deep-conversion unit at the Port Arthur refinery in the United States that was started up in the second quarter, while continuing to improve the competitiveness of its main Downstream-Chemicals platforms.

In the coming months, TOTAL expects to finalize the pending acquisitions and asset sales in all of its operating segments, confirming its strategy of rebalancing its activities while maintaining the strength of its balance sheet.

Forward-looking statements

This document may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on the beliefs and assumptions of the management of TOTAL and on the information currently available to such management. Forward-looking statements include information concerning forecasts, projections, anticipated synergies, and other information concerning possible or assumed future results of TOTAL, and may be preceded by, followed by, or otherwise include the words “believes”, “expects”, “anticipates”, “intends”, “plans”, “targets”, “estimates” or similar expressions.

Forward-looking statements are not assurances of results or values. They involve risks, uncertainties and assumptions. TOTAL’s future results and share value may differ materially from those expressed in these forward-looking statements. Many of the factors that will determine these results and values are beyond TOTAL’s ability to control or predict. Except for its ongoing obligations to disclose material information as required by applicable securities laws, TOTAL does not have any intention or obligation to update forward-looking statements after the distribution of this document, even if new information, future events or other circumstances have made them incorrect or misleading.

You should understand that various factors, certain of which are discussed elsewhere in this document and in the documents referred to in, or incorporated by reference into, this document, could affect the future results of TOTAL and could cause results to differ materially from those expressed in such forward-looking statements, including:

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material adverse changes in general economic conditions or in the markets served by TOTAL, including changes in the prices of oil, natural gas, refined products, petrochemical products and other chemicals;

•

changes in currency exchange rates and currency devaluations;

•

the success and the economic efficiency of oil and natural gas exploration, development and production programs, including without limitation, those that are not controlled and/or operated by TOTAL;

•

uncertainties about estimates of changes in proven and potential reserves and the capabilities of production facilities;

•

uncertainties about the ability to control unit costs in exploration, production, refining and marketing (including refining margins) and chemicals;

•

changes in the current capital expenditure plans of TOTAL;

⁹	Ex-dividend date will be December 19, 2011.

•

the ability of TOTAL to realize anticipated cost savings, synergies and operating efficiencies;

•

the financial resources of competitors;

•

changes in laws and regulations, including tax and environmental laws and industrial safety regulations;

•

the quality of future opportunities that may be presented to or pursued by TOTAL;

•

the ability to generate cash flow or obtain financing to fund growth and the cost of such financing and liquidity conditions in the capital markets generally;

•

the ability to obtain governmental or regulatory approvals;

•

the ability to respond to challenges in international markets, including political or economic conditions, armed conflict, trade and regulatory matters and actual or proposed sanctions on companies that conduct business in certain countries;

•

the ability to complete and integrate appropriate acquisitions, strategic alliances and joint ventures;

•

changes in the political environment that adversely affect exploration, production licenses and contractual rights or impose minimum drilling obligations, price controls, nationalization or expropriation, and regulation of refining and marketing, chemicals and power generating activities;

•

the possibility that other unpredictable events such as labor disputes or industrial accidents will adversely affect the business of TOTAL; and

•

the risk that TOTAL will inadequately hedge the price of crude oil or finished products.

For additional factors, you should read the information set forth under “Item 3. Risk Factors”, “Item 4. Information on the Company — Other Matters”, “Item 5. Operating and Financial Review and Prospects” and “Item 11. Quantitative and Qualitative Disclosures about Market Risk” in TOTAL’s Form 20-F for the year ended December 31, 2010.

Operating information by segment

Second quarter and first half 2010

•

UPSTREAM


2Q11		1Q11		2Q10		2Q11 vs 2Q10			Combined liquids and gas production by region (kboe/d)	1H11		1H10		1H11 vs 1H10

	475		582		577		-18	%	Europe		528		612		-14	%
	628		691		752		-16	%	Africa		659		749		-12	%
	571		581		515		+11	%	Middle East		576		515		+12	%
	66		68		63		+5	%	North America		67		65		+3	%
	190		185		184		+3	%	South America		188		178		+6	%
	241		242		246		-2	%	Asia-Pacific		241		250		-4	%
	140		22		22		x6.4		CIS		82		24		x3.4

	2,311		2,371		2,359		-2	%	Total production		2,341		2,393		-2	%

	605		500		434		+39	%	Includes equity and non-consolidated affiliates		552		425		+30	%

2Q11		1Q11		2Q10		2Q11 vs 2Q10			Liquids production by region (kb/d)	1H11		1H10		1H11 vs 1H10

	240		263		258		-7	%	Europe		251		280		-10	%
	484		551		611		-21	%	Africa		517		616		-16	%
	321		325		309		+4	%	Middle East		323		305		+6	%
	26		32		30		-13	%	North America		29		31		-6	%
	73		82		76		-4	%	South America		78		74		+5	%
	28		28		30		-7	%	Asia-Pacific		28		31		-10	%
	25		12		13		+92	%	CIS		19		13		+46	%

	1,197		1,293		1,327		-10	%	Total production		1,245		1,350		-8	%

	331		325		298		+11	%	Includes equity and non-consolidated affiliates		328		291		+13	%


2Q11		1Q11		2Q10		2Q11 vs 2Q10			Gas production by region (Mcf/d)	1H11		1H10		1H11 vs 1H10

	1,284		1,743		1,689		-24	%	Europe		1,512		1,814		-17	%
	734		717		704		+4	%	Africa		726		675		+8	%
	1,355		1,390		1,098		+23	%	Middle East		1,372		1,143		+20	%
	226		204		191		+18	%	North America		215		190		+13	%
	650		571		594		+9	%	South America		611		574		+6	%
	1,209		1,202		1,220		-1	%	Asia-Pacific		1,206		1,234		-2	%
	619		53		53		x11.7		CIS		337		59		x5.7

	6,077		5,880		5,549		+10	%	Total production		5,979		5,689		+5	%

	1,478		947		737		x2.0		Includes equity and non-consolidated affiliates		1,214		723		+68	%

2Q11		1Q11		2Q10		2Q11 vs 2Q10			Liquefied natural gas	1H11		1H10		1H11 vs 1H10

	3.34		3.38		3.00		+11	%	LNG sales* (Mt)		6.73		5.85		+15	%

Sales, Group share, excluding trading ; 2010 data restated to reflect volume estimates for Bontang LNG in Indonesia based on the 2010 SEC coefficient.

•

DOWNSTREAM


2Q11		1Q11			2Q10		2Q11 vs 2Q10			Refined products sales by region (kb/d)*	1H11		1H10		1H11 vs 1H10

	1,855		1,967	**		1,881		-1	%	Europe		1,910		1,915		—
	310		294			301		+3	%	Africa		302		294		+3	%
	104		102			115		-10	%	Americas		103		131		-21	%
	169		167			163		+4	%	Rest of world		169		154		+10	%

	2,438		2,530			2,460		-1	%	Total consolidated sales		2,484		2,494		—
	1,341		1,187			1,526		-12	%	Trading		1,264		1,258		—

	3,779		3,717			3,986		-5	%	Total refined product sales		3,748		3,752		—

Includes share of CEPSA and, starting October 2010, of TotalErg.

Corrected 1Q11 data.

Investments — Divestments


2Q11		1Q11			2Q10		2Q11 vs 2Q10			in millions of euros	1H11		1H10		1H11 vs 1H10
	3,467		2,787			3,067		+13	%	Investments excluding acquisitions*		6,254		5,494		+14	%
	242		217			221		+10	%	• Capitalized exploration		459		420		+9	%
	210		(208	)		170		+24	%	• Changes in non-current loans**		2		281		n/a
	4,008		2,529			305		x13.1		Acquisitions		6,537		1,522		x4.3
	7,475		5,316			3,372		x2.2		Investments including acquisitions*		12,791		7,016		+82	%
	1,243		296			758		+64	%	Asset sales		1,539		1,723		-11	%
	6,232		5,020			2,596		x2.4		Net investments		11,252		5,257		x2.1

Includes changes in non-current loans.

Includes net investments in equity affiliates and non-consolidated companies + net financing for employees related stock purchase plans.

Net-debt-to-equity ratio


in millions of euros	6/30/2011			3/31/2011			6/30/2010

Current borrowings		12,289			11,674			8,521
Net current financial assets		(2,737	)		(1,709	)		(1,225	)
Non-current financial debt		20,410			20,215			22,813
Hedging instruments of non-current debt		(1,756	)		(1,352	)		(1,812	)
Cash and cash equivalents		(13,387	)		(17,327	)		(14,832	)

Net debt		14,819			11,501			13,465

Shareholders’ equity		61,371			62,535			60,955
Estimated dividend payable		(1,248	)		(3,832	)		(2,547	)
Minority interests		934			898			858

Equity		61,057			59,601			59,266

Net-debt-to-equity ratio		24.3	%		19.3	%		22.7	%

Return on average capital employed

•

Twelve months ended June 30, 2011


in millions of euros	Upstream			Downstream			Chemicals

Adjusted net operating income		9,729			1,003			911
Capital employed at 6/30/2010*		43,908			16,010			7,286
Capital employed at 6/30/2011*		46,671			14,921			7,938

ROACE		21.5	%		6.5	%		12.0	%

At replacement cost (excluding after-tax inventory effect).

•

Twelve months ended March 31, 2011


in millions of euros	Upstream			Downstream			Chemicals

Adjusted net operating income		9,475			1,289			938
Capital employed at 3/31/2010*		39,925			15,634			7,412
Capital employed at 3/31/2011*		44,528			14,527			7,681

ROACE		22.4	%		8.5	%		12.4	%

At replacement cost (excluding after-tax inventory effect).

•

Twelve months ended December 31, 2010


in millions of euros	Upstream			Downstream			Chemicals

Adjusted net operating income		8,597			1,168			857
Capital employed at 12/31/2009*		37,397			15,299			6,898
Capital employed at 12/31/2010*		43,972			15,561			7,312

ROACE		21.1	%		7.6	%		12.1	%

At replacement cost (excluding after-tax inventory effect).

MAIN INDICATORS

Chart updated around the middle of the month following the end of each quarter.


	€/ $		European refining margins ERMI* ($/t) **		Brent ($/b)		Average liquids price*** ($/b)		Average gas price ($/Mbtu)***
Second quarter 2011		1.44		16.3		117.0		110.6		6.60
First quarter 2011		1.37		24.6		105.4		99.5		6.19
Fourth quarter 2010		1.36		32.3		86.5		83.7		5.62
Third quarter 2010		1.29		16.4		76.9		72.8		5.13
Second quarter 2010		1.27		31.2		78.2		74.8		4.82

European Refining Margin Indicator (ERMI) is an indicator intended to represent the margin after variable costs for a hypothetical complex refinery located around Rotterdam in Northern Europe that processes a mix of crude oil and other inputs commonly supplied to this region to produce and market the main refined products at prevailing prices in this region. The indicator margin may not be representative of the actual margins achieved by the Group in any period because of the Group’s particular refinery configurations, product mix effects or other company-specific operating conditions.

**	1 $/t = 0.136 $/b.

***	Consolidated subsidiaries, excluding fixed margin and buy-back contracts.

Disclaimer: these data are based on TOTAL’s reporting and are not audited. They are subject to change.

CONSOLIDATED STATEMENT OF INCOME

TOTAL

(unaudited)


(M€) ^(a)	2^nd quarter 2011			1^st quarter 2011			2^nd quarter 2010

Sales		45,009			46,029			41,329
Excise taxes		(4,544	)		(4,427	)		(5,002	)
Revenues from sales		40,465			41,602			36,327

Purchases, net of inventory variation		(28,386	)		(27,255	)		(23,929	)
Other operating expenses		(4,804	)		(4,702	)		(4,833	)
Exploration costs		(179	)		(259	)		(292	)
Depreciation, depletion and amortization of tangible assets and mineral interests		(1,531	)		(1,686	)		(1,757	)
Other income		246			85			114
Other expense		(138	)		(59	)		(114	)

Financial interest on debt		(159	)		(136	)		(113	)
Financial income from marketable securities & cash equivalents		55			47			24
Cost of net debt		(104	)		(89	)		(89	)

Other financial income		335			75			142
Other financial expense		(104	)		(108	)		(95	)

Equity in income (loss) of affiliates		444			506			513

Income taxes		(3,432	)		(4,072	)		(2,819	)

Consolidated net income		2,812			4,038			3,168

Group share		2,726			3,946			3,101
Minority interests		86			92			67

Earnings per share (€)		1.21			1.76			1.39

Fully-diluted earnings per share (€)		1.21			1.75			1.38

(a)

Except for per share amounts.

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

TOTAL

(unaudited)


(M€)	2^nd quarter 2011			1^st quarter 2011			2^nd quarter 2010

Consolidated net income		2,812			4,038			3,168


Other comprehensive income
Currency translation adjustment		(666	)		(1,978	)		3,149
Available for sale financial assets		315			115			(49	)
Cash flow hedge		(11	)		(24	)		(75	)
Share of other comprehensive income of associates, net amount		(16	)		(87	)		242
Other		(4	)		2			2

Tax effect		(35	)		6			26

Total other comprehensive income (net amount)		(417	)		(1,966	)		3,295


Comprehensive income		2,395			2,072			6,463

- Group share		2,326			2,030			6,368
- Minority interests		69			42			95

CONSOLIDATED STATEMENT OF INCOME

TOTAL

(unaudited)


(M€) ^(a)	1^st half 2011			1^st half 2010

Sales		91,038			78,932
Excise taxes		(8,971	)		(9,444	)
Revenues from sales		82,067			69,488

Purchases, net of inventory variation		(55,641	)		(45,630	)
Other operating expenses		(9,506	)		(9,545	)
Exploration costs		(438	)		(507	)
Depreciation, depletion and amortization of tangible assets and mineral interests		(3,217	)		(3,456	)
Other income		331			274
Other expense		(197	)		(326	)

Financial interest on debt		(295	)		(213	)
Financial income from marketable securities & cash equivalents		102			48
Cost of net debt		(193	)		(165	)

Other financial income		410			213
Other financial expense		(212	)		(190	)

Equity in income (loss) of affiliates		950			1,037

Income taxes		(7,504	)		(5,347	)

Consolidated net income		6,850			5,846

Group share		6,672			5,714
Minority interests		178			132

Earnings per share (€)		2.98			2.56

Fully-diluted earnings per share (€)		2.96			2.55

(a)

Except for per share amounts.

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

TOTAL

(unaudited)


(M€)	1^st half 2011			1^st half 2010

Consolidated net income		6,850			5,846


Other comprehensive income
Currency translation adjustment		(2,644	)		4,996
Available for sale financial assets		430			(52	)
Cash flow hedge		(35	)		(51	)
Share of other comprehensive income of associates, net amount		(103	)		475
Other		(2	)		3

Tax effect		(29	)		18


Total other comprehensive income (net amount)		(2,383	)		5,389


Comprehensive income		4,467			11,235

- Group share		4,356			11,044
- Minority interests		111			191

CONSOLIDATED BALANCE SHEET

TOTAL


(M€)	June 30, 2011 (unaudited)			March 31, 2011 (unaudited)			December 31, 2010			June 30, 2010 (unaudited)

ASSETS

Non-current assets
Intangible assets, net		8,961			9,211			8,917			8,767
Property, plant and equipment, net		55,323			54,955			54,964			57,825
Equity affiliates : investments and loans		11,054			8,143			11,516			15,363
Other investments		5,287			4,458			4,590			1,220
Hedging instruments of non-current financial debt		1,756			1,352			1,870			1,812
Other non-current assets		3,727			3,466			3,655			3,437


Total non-current assets		86,108			81,585			85,512			88,424


Current assets
Inventories, net		15,950			15,516			15,600			15,130
Accounts receivable, net		18,267			19,758			18,159			18,193
Other current assets		8,474			8,766			7,483			8,289
Current financial assets		3,122			2,026			1,205			1,603
Cash and cash equivalents		13,387			17,327			14,489			14,832


Total current assets		59,200			63,393			56,936			58,047


Assets classified as held for sale		5,211			4,914			1,270			—


Total assets		150,519			149,892			143,718			146,471

LIABILITIES & SHAREHOLDERS’ EQUITY

Shareholders’ equity
Common shares		5,903			5,878			5,874			5,872
Paid-in surplus and retained earnings		64,148			64,677			60,538			58,274
Currency translation adjustment		(5,177	)		(4,517	)		(2,495	)		381
Treasury shares		(3,503	)		(3,503	)		(3,503	)		(3,572	)


Total shareholders’ equity - Group Share		61,371			62,535			60,414			60,955


Minority interests		934			898			857			858


Total shareholders’ equity		62,305			63,433			61,271			61,813


Non-current liabilities
Deferred income taxes		9,619			10,204			9,947			10,328
Employee benefits		2,111			2,103			2,171			2,181
Provisions and other non-current liabilities		8,419			8,584			9,098			9,418


Total non-current liabilities		20,149			20,891			21,216			21,927


Non-current financial debt		20,410			20,215			20,783			22,813


Current liabilities
Accounts payable		18,395			18,383			18,450			17,557
Other creditors and accrued liabilities		16,191			14,812			11,989			13,462
Current borrowings		12,289			11,674			9,653			8,521
Other current financial liabilities		385			317			159			378


Total current liabilities		47,260			45,186			40,251			39,918


Liabilities directly associated with the assets classified as held for sale		395			167			197			—


Total liabilities and shareholders’ equity		150,519			149,892			143,718			146,471

CONSOLIDATED STATEMENT OF CASH FLOW

TOTAL

(unaudited)


(M€)	2^nd quarter 2011			1^st quarter 2011			2^nd quarter 2010

CASH FLOW FROM OPERATING ACTIVITIES

Consolidated net income		2,812			4,038			3,168
Depreciation, depletion and amortization		1,641			1,888			1,996
Non-current liabilities, valuation allowances and deferred taxes		283			565			239
Impact of coverage of pension benefit plans		—			—			—
(Gains) losses on sales of assets		(229	)		(6	)		(24	)
Undistributed affiliates’ equity earnings		59			(182	)		79
(Increase) decrease in working capital		476			(587	)		(522	)
Other changes, net		22			(2	)		6

Cash flow from operating activities		5,064			5,714			4,942

CASH FLOW USED IN INVESTING ACTIVITIES

Intangible assets and property, plant and equipment additions		(3,215	)		(5,374	)		(2,958	)
Acquisitions of subsidiaries, net of cash acquired		(979	)		—			—
Investments in equity affiliates and other securities		(3,071	)		(150	)		(244	)
Increase in non-current loans		(305	)		(159	)		(244	)

Total expenditures		(7,570	)		(5,683	)		(3,446	)
Proceeds from disposal of intangible assets and property, plant and equipment		620			6			89
Proceeds from disposal of subsidiaries, net of cash sold		171			—			321
Proceeds from disposal of non-current investments		452			290			348
Repayment of non-current loans		95			367			92

Total divestments		1,338			663			850

Cash flow used in investing activities		(6,232	)		(5,020	)		(2,596	)

CASH FLOW USED IN FINANCING ACTIVITIES

Issuance (repayment) of shares:
- Parent company shareholders		354			50			6
- Treasury shares		—			—			31
- Minority shareholders		—			—			—
Dividends paid:
- Parent company shareholders		(2,572	)		—			(2,548	)
- Minority shareholders		(61	)		(1	)		(82	)
Other transactions with minority shareholders		59			—			(450	)
Net issuance (repayment) of non-current debt		678			2,228			1,979
Increase (decrease) in current borrowings		(200	)		488			977
Increase (decrease) in current financial assets and liabilities		(1,123	)		(511	)		(453	)
Cash flow used in financing activities		(2,865	)		2,254			(540	)

Net increase (decrease) in cash and cash equivalents		(4,033	)		2,948			1,806
Effect of exchange rates		93			(110	)		72
Cash and cash equivalents at the beginning of the period		17,327			14,489			12,954

Cash and cash equivalents at the end of the period		13,387			17,327			14,832

CONSOLIDATED STATEMENT OF CASH FLOW

TOTAL

(unaudited)


(M€)	1^st half 2011			1^st half 2010

CASH FLOW FROM OPERATING ACTIVITIES

Consolidated net income		6,850			5,846
Depreciation, depletion and amortization		3,529			3,867
Non-current liabilities, valuation allowances and deferred taxes		848			294
Impact of coverage of pension benefit plans		—			—
(Gains) losses on sales of assets		(235	)		(172	)
Undistributed affiliates’ equity earnings		(123	)		(183	)
(Increase) decrease in working capital		(111	)		513
Other changes, net		20			37

Cash flow from operating activities		10,778			10,202

CASH FLOW USED IN INVESTING ACTIVITIES

Intangible assets and property, plant and equipment additions		(8,589	)		(6,422	)
Acquisitions of subsidiaries, net of cash acquired		(979	)		—
Investments in equity affiliates and other securities		(3,221	)		(313	)
Increase in non-current loans		(464	)		(420	)

Total expenditures		(13,253	)		(7,155	)
Proceeds from disposal of intangible assets and property, plant and equipment		626			123
Proceeds from disposal of subsidiaries, net of cash sold		171			321
Proceeds from disposal of non-current investments		742			1,279
Repayment of non-current loans		462			175

Total divestments		2,001			1,898

Cash flow used in investing activities		(11,252	)		(5,257	)

CASH FLOW USED IN FINANCING ACTIVITIES

Issuance (repayment) of shares:
- Parent company shareholders		404			11
- Treasury shares		—			49
- Minority shareholders		—			—
Dividends paid:
- Parent company shareholders		(2,572	)		(2,548	)
- Minority shareholders		(62	)		(82	)
Other transactions with minority shareholders		59			(450	)
Net issuance (repayment) of non-current debt		2,906			2,042
Increase (decrease) in current borrowings		288			376
Increase (decrease) in current financial assets and liabilities		(1,634	)		(950	)
Cash flow used in financing activities		(611	)		(1,552	)

Net increase (decrease) in cash and cash equivalents		(1,085	)		3,393
Effect of exchange rates		(17	)		(223	)
Cash and cash equivalents at the beginning of the period		14,489			11,662

Cash and cash equivalents at the end of the period		13,387			14,832

CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY

TOTAL

(unaudited)


	Common shares issued				Paid-in surplus and retained earnings			Currency translation adjustment			Treasury shares						Shareholders’ equity Group Share			Minority interests			Total shareholders’ equity
(M€)	Number		Amount		Paid-in surplus and retained earnings			Currency translation adjustment			Number			Amount			Shareholders’ equity Group Share			Minority interests			Total shareholders’ equity
As of January 1, 2010		2,348,422,884		5,871		55,372			(5,069	)		(115,407,190	)		(3,622	)		52,552			987			53,539

Net income of the first half		—		—		5,714			—			—			—			5,714			132			5,846
Other comprehensive Income		—		—		(130	)		5,460			—			—			5,330			59			5,389
Comprehensive Income		—		—		5,584			5,460			—			—			11,044			191			11,235
Dividend		—		—		(2,548	)		—			—			—			(2,548	)		(82	)		(2,630	)
Issuance of common shares		306,577		1		10			—			—			—			11			—			11
Purchase of treasury shares		—		—		—			—			—			—			—			—			—
Sale of treasury shares (1)		—		—		(1	)		—			1,258,812			50			49			—			49
Share-based payments		—		—		59			—			—			—			59			—			59
Share cancellation		—		—		—			—			—			—			—			—			—
Other operations with minority interests		—		—		(202	)		(10	)		—			—			(212	)		(238	)		(450	)
Other items		—		—		—			—			—			—			—			—			—
As of June 30, 2010		2,348,729,461		5,872		58,274			381			(114,148,378	)		(3,572	)		60,955			858			61,813

Net income from July 1 to December 31, 2010		—		—		4,857			—			—			—			4,857			104			4,961
Other comprehensive Income		—		—		(86	)		(2,879	)		—			—			(2,965	)		(50	)		(3,015	)
Comprehensive Income		—		—		4,771			(2,879	)		—			—			1,892			54			1,946
Dividend		—		—		(2,550	)		—			—			—			(2,550	)		(70	)		(2,620	)
Issuance of common shares		911,470		2		28			—			—			—			30			—			30
Purchase of treasury shares		—		—		—			—			—			—			—			—			—
Sale of treasury shares (1)		—		—		(69	)		—			1,660,699			69			—			—			—
Share-based payments		—		—		81			—			—			—			81			—			81
Share cancellation		—		—		—			—			—			—			—			—			—
Other operations with minority interests		—		—		3			3			—			—			6			15			21
Other items		—		—		—			—			—			—			—			—			—
As of December 31, 2010		2,349,640,931		5,874		60,538			(2,495	)		(112,487,679	)		(3,503	)		60,414			857			61,271

Net income of the first half		—		—		6,672			—			—			—			6,672			178			6,850
Other comprehensive Income		—		—		368			(2,684	)		—			—			(2,316	)		(67	)		(2,383	)
Comprehensive Income		—		—		7,040			(2,684	)		—			—			4,356			111			4,467
Dividend		—		—		(3,888	)		—			—			—			(3,888	)		(62	)		(3,950	)
Issuance of common shares		11,749,578		29		375			—			—			—			404			—			404
Purchase of treasury shares		—		—		—			—			—			—			—			—			—
Sale of treasury shares (1)		—		—		—			—			3,804			—			—			—			—
Share-based payments		—		—		83			—			—			—			83			—			83
Share cancellation		—		—		—			—			—			—			—			—			—
Other operations with minority interests		—		—		—			2			—			—			2			57			59
Other items		—		—		—			—			—			—			—			(29	)		(29	)
As of June 30, 2011		2,361,390,509		5,903		64,148			(5,177	)		(112,483,875	)		(3,503	)		61,371			934			62,305

(1)

Treasury shares related to the stock option purchase plans and restricted stock grants

BUSINESS SEGMENT INFORMATION

TOTAL

(unaudited)


2^nd quarter 2011 (M€)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Non-Group sales		5,166			34,551			5,291			1			—			45,009
Intersegment sales		6,341			1,535			345			43			(8,264	)		—
Excise taxes		—			(4,544	)		—			—			—			(4,544	)

Revenues from sales		11,507			31,542			5,636			44			(8,264	)		40,465
Operating expenses		(5,072	)		(31,149	)		(5,251	)		(161	)		8,264			(33,369	)
Depreciation, depletion and amortization of tangible assets and mineral interests		(1,100	)		(300	)		(122	)		(9	)		—			(1,531	)

Operating income		5,335			93			263			(126	)		—			5,565
Equity in income (loss) of affiliates and other items		473			37			18			255			—			783
Tax on net operating income		(3,275	)		(20	)		(117	)		(53	)		—			(3,465	)

Net operating income		2,533			110			164			76			—			2,883
Net cost of net debt																	(71	)
Minority interests																	(86	)

Net income																	2,726

2^nd quarter 2011 (adjustments) ^(a) (M€)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Non-Group sales		(55	)		—			—			—						(55	)
Intersegment sales
Excise taxes

Revenues from sales		(55	)		—			—			—						(55	)
Operating expenses		—			(135	)		(15	)		—						(150	)
Depreciation, depletion and amortization of tangible assets and mineral interests		—			—			—			—						—

Operating income^(b)		(55	)		(135	)		(15	)		—						(205	)
Equity in income (loss) of affiliates and other items		121			(2	)		(37	)		43						125
Tax on net operating income		10			50			(31	)		(2	)					27

Net operating income^(b)		76			(87	)		(83	)		41						(53	)
Net cost of net debt																	—
Minority interests																	(15	)

Net income																	(68	)

(a) Adjustments include special items, inventory valuation effect and, as from January 1^st, 2011, the effect of changes in fair value. (b) Of which inventory valuation effect

On operating income		—			(72	)		(15	)		—
On net operating income		—			(42	)		(17	)		—


2^ndquarter 2011 (adjusted) (M€) ^(a)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Non-Group sales		5,221			34,551			5,291			1			—			45,064
Intersegment sales		6,341			1,535			345			43			(8,264	)		—
Excise taxes		—			(4,544	)		—			—			—			(4,544	)

Revenues from sales		11,562			31,542			5,636			44			(8,264	)		40,520
Operating expenses		(5,072	)		(31,014	)		(5,236	)		(161	)		8,264			(33,219	)
Depreciation, depletion and amortization of tangible assets and mineral interests		(1,100	)		(300	)		(122	)		(9	)		—			(1,531	)

Adjusted operating income		5,390			228			278			(126	)		—			5,770
Equity in income (loss) of affiliates and other items		352			39			55			212			—			658
Tax on net operating income		(3,285	)		(70	)		(86	)		(51	)		—			(3,492	)

Adjusted net operating income		2,457			197			247			35			—			2,936
Net cost of net debt																	(71	)
Minority interests																	(71	)

Adjusted net income																	2,794

Adjusted fully-diluted earnings per share (€)																	1.24

(a)

Except for per share amounts.


2^ndquarter 2011 (M€)	Upstream		Downstream		Chemicals		Corporate			Intercompany	Total
Total expenditures		6,868		462		209		31				7,570
Total divestments		921		28		12		377				1,338
Cash flow from operating activities		5,605		7		138		(686	)			5,064

BUSINESS SEGMENT INFORMATION

TOTAL

(unaudited)


1^st quarter 2011 (M€)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Non-Group sales		6,144			34,769			5,105			11			—			46,029
Intersegment sales		6,939			1,582			297			41			(8,859	)		—
Excise taxes		—			(4,427	)		—			—			—			(4,427	)

Revenues from sales		13,083			31,924			5,402			52			(8,859	)		41,602
Operating expenses		(5,938	)		(30,093	)		(4,891	)		(153	)		8,859			(32,216	)
Depreciation, depletion and amortization of tangible assets and mineral interests		(1,240	)		(319	)		(119	)		(8	)		—			(1,686	)

Operating income		5,905			1,512			392			(109	)		—			7,700
Equity in income (loss) of affiliates and other items		343			59			82			15			—			499
Tax on net operating income		(3,527	)		(451	)		(124	)		—			—			(4,102	)

Net operating income		2,721			1,120			350			(94	)		—			4,097
Net cost of net debt																	(59	)
Minority interests																	(92	)

Net income																	3,946

1^st quarter 2011 (adjustments) ^(a) (M€)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Non-Group sales		84			—			—			—						84
Intersegment sales
Excise taxes

Revenues from sales		84			—			—			—						84
Operating expenses		—			1,226			130			—						1,356
Depreciation, depletion and amortization of tangible assets and mineral interests		—			—			—			—						—

Operating income^(b)		84			1,226			130			—						1,440
Equity in income (loss) of affiliates and other items		—			14			25			11						50
Tax on net operating income		(212	)		(396	)		(43	)		—						(651	)

Net operating income^(b)		(128	)		844			112			11						839
Net cost of net debt																	—
Minority interests																	3

Net income																	842
(a) Adjustments include special items, inventory valuation effect and, as from January 1^st, 2011, the effect of changes in fair value. (b) Of which inventory valuation effect

On operating income		—			1,226			130			—
On net operating income		—			844			112			—


1^st quarter 2011 (adjusted) (M€) ^(a)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Non-Group sales		6,060			34,769			5,105			11			—			45,945
Intersegment sales		6,939			1,582			297			41			(8,859	)		—
Excise taxes		—			(4,427	)		—			—			—			(4,427	)

Revenues from sales		12,999			31,924			5,402			52			(8,859	)		41,518
Operating expenses		(5,938	)		(31,319	)		(5,021	)		(153	)		8,859			(33,572	)
Depreciation, depletion and amortization of tangible assets and mineral interests		(1,240	)		(319	)		(119	)		(8	)		—			(1,686	)

Adjusted operating income		5,821			286			262			(109	)		—			6,260
Equity in income (loss) of affiliates and other items		343			45			57			4			—			449
Tax on net operating income		(3,315	)		(55	)		(81	)		—			—			(3,451	)

Adjusted net operating income		2,849			276			238			(105	)		—			3,258
Net cost of net debt																	(59	)
Minority interests																	(95	)

Adjusted net income																	3,104

Adjusted fully-diluted earnings per share (€)																	1.38

(a)

Except for per share amounts.


1^st quarter 2011 (M€)	Upstream		Downstream		Chemicals			Corporate		Intercompany		Total
Total expenditures		5,232		264		171			16		—		5,683
Total divestments		335		23		14			291		—		663
Cash flow from operating activities		4,643		1,158		(144	)		57		—		5,714

BUSINESS SEGMENT INFORMATION

TOTAL

(unaudited)


2^nd quarter 2010 (M€)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Non-Group sales		4,546			32,190			4,589			4			—			41,329
Intersegment sales		5,717			1,394			270			45			(7,426	)		—
Excise taxes		—			(5,002	)		—			—			—			(5,002	)

Revenues from sales		10,263			28,582			4,859			49			(7,426	)		36,327
Operating expenses		(4,364	)		(27,460	)		(4,483	)		(173	)		7,426			(29,054	)
Depreciation, depletion and amortization of tangible assets and mineral interests		(1,292	)		(318	)		(136	)		(11	)		—			(1,757	)

Operating income		4,607			804			240			(135	)		—			5,516
Equity in income (loss) of affiliates and other items		190			124			78			168			—			560
Tax on net operating income		(2,621	)		(250	)		(65	)		85			—			(2,851	)

Net operating income		2,176			678			253			118			—			3,225
Net cost of net debt																	(57	)
Minority interests																	(67	)

Net income																	3,101

2^nd quarter 2010 (adjustments) ^(a) (M€)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Non-Group sales
Intersegment sales
Excise taxes

Revenues from sales
Operating expenses		—			255			(57	)		—						198
Depreciation, depletion and amortization of tangible assets and mineral interests		—			—			(8	)		—						(8	)

Operating income^(b)		—			255			(65	)		—						190
Equity in income (loss) of affiliates and other items^(c)		(40	)		25			18			(7	)					(4	)
Tax on net operating income		13			(85	)		26			—						(46	)

Net operating income^(b)		(27	)		195			(21	)		(7	)					140
Net cost of net debt																	—
Minority interests																	—

Net income																	140
(a) Adjustments include special items, inventory valuation effect and, until June 30,2010, equity share of adjustments related to Sanofi. (b) Of which inventory valuation effect

On operating income		—			255			(41	)		—
On net operating income		—			195			(25	)		—

(c) Of which equity share of adjustments related to Sanofi		—			—			—			(40	)


2^ndquarter 2010 (adjusted) (M€) ^(a)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Non-Group sales		4,546			32,190			4,589			4			—			41,329
Intersegment sales		5,717			1,394			270			45			(7,426	)		—
Excise taxes		—			(5,002	)		—			—			—			(5,002	)

Revenues from sales		10,263			28,582			4,859			49			(7,426	)		36,327
Operating expenses		(4,364	)		(27,715	)		(4,426	)		(173	)		7,426			(29,252	)
Depreciation, depletion and amortization of tangible assets and mineral interests		(1,292	)		(318	)		(128	)		(11	)		—			(1,749	)

Adjusted operating income		4,607			549			305			(135	)		—			5,326
Equity in income (loss) of affiliates and other items		230			99			60			175			—			564
Tax on net operating income		(2,634	)		(165	)		(91	)		85			—			(2,805	)

Adjusted net operating income		2,203			483			274			125			—			3,085
Net cost of net debt																	(57	)
Minority interests																	(67	)

Adjusted net income																	2,961

Adjusted fully-diluted earnings per share (€)																	1.32

(a) Except for per share amounts.

2^ndquarter 2010 (M€)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Total expenditures		2,723			562			144			17						3,446
Total divestments		174			11			328			337						850
Cash flow from operating activities		4,154			1,042			477			(731	)					4,942

BUSINESS SEGMENT INFORMATION

TOTAL

(unaudited)


1^st half 2011 (M€)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Non-Group sales		11,310			69,320			10,396			12			—			91,038
Intersegment sales		13,280			3,117			642			84			(17,123	)		—
Excise taxes		—			(8,971	)		—			—			—			(8,971	)

Revenues from sales		24,590			63,466			11,038			96			(17,123	)		82,067
Operating expenses		(11,010	)		(61,242	)		(10,142	)		(314	)		17,123			(65,585	)
Depreciation, depletion and amortization of tangible assets and mineral interests		(2,340	)		(619	)		(241	)		(17	)		—			(3,217	)

Operating income		11,240			1,605			655			(235	)		—			13,265
Equity in income (loss) of affiliates and other items		816			96			100			270			—			1,282
Tax on net operating income		(6,802	)		(471	)		(241	)		(53	)		—			(7,567	)

Net operating income		5,254			1,230			514			(18	)		—			6,980
Net cost of net debt																	(130	)
Minority interests																	(178	)

Net income																	6,672

1^st half 2011 (adjustments) ^(a) (M€)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Non-Group sales		29			—			—			—						29
Intersegment sales
Excise taxes

Revenues from sales		29			—			—			—						29
Operating expenses		—			1,091			115			—						1,206
Depreciation, depletion and amortization of tangible assets and mineral interests		—			—			—			—						—

Operating income^(b)		29			1,091			115			—						1,235
Equity in income (loss) of affiliates and other items		121			12			(12	)		54						175
Tax on net operating income		(202	)		(346	)		(74	)		(2	)					(624	)

Net operating income^(b)		(52	)		757			29			52						786
Net cost of net debt																	—
Minority interests																	(12	)

Net income																	774
(a) Adjustments include special items, inventory valuation effect and, as from January 1^st, 2011, the effect of changes in fair value. (b) Of which inventory valuation effect

On operating income		—			1,154			115			—
On net operating income		—			802			95			—


1^st half 2011 (adjusted) (M€)^(a)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Non-Group sales		11,281			69,320			10,396			12			—			91,009
Intersegment sales		13,280			3,117			642			84			(17,123	)		—
Excise taxes		—			(8,971	)		—			—			—			(8,971	)

Revenues from sales		24,561			63,466			11,038			96			(17,123	)		82,038
Operating expenses		(11,010	)		(62,333	)		(10,257	)		(314	)		17,123			(66,791	)
Depreciation, depletion and amortization of tangible assets and mineral interests		(2,340	)		(619	)		(241	)		(17	)		—			(3,217	)

Adjusted operating income		11,211			514			540			(235	)		—			12,030
Equity in income (loss) of affiliates and other items		695			84			112			216			—			1,107
Tax on net operating income		(6,600	)		(125	)		(167	)		(51	)		—			(6,943	)

Adjusted net operating income		5,306			473			485			(70	)		—			6,194
Net cost of net debt																	(130	)
Minority interests																	(166	)

Adjusted net income																	5,898

Adjusted fully-diluted earnings per share (€)																	2.62

(a)

Except for per share amounts.


1^st half 2011 (M€)	Upstream		Downstream		Chemicals			Corporate			Intercompany	Total
Total expenditures		12,100		726		380			47				13,253
Total divestments		1,256		51		26			668				2,001
Cash flow from operating activities		10,248		1,165		(6	)		(629	)			10,778

BUSINESS SEGMENT INFORMATION

TOTAL

(unaudited)


1^st half 2010 (M€)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Non-Group sales		9,115			60,998			8,812			7			—			78,932
Intersegment sales		11,019			2,475			507			87			(14,088	)		—
Excise taxes		—			(9,444	)		—			—			—			(9,444	)

Revenues from sales		20,134			54,029			9,319			94			(14,088	)		69,488
Operating expenses		(8,818	)		(52,081	)		(8,553	)		(318	)		14,088			(55,682	)
Depreciation, depletion and amortization of tangible assets and mineral interests		(2,548	)		(623	)		(266	)		(19	)		—			(3,456	)

Operating income		8,768			1,325			500			(243	)		—			10,350
Equity in income (loss) of affiliates and other items		298			155			123			432			—			1,008
Tax on net operating income		(4,995	)		(414	)		(138	)		142			—			(5,405	)

Net operating income		4,071			1,066			485			331			—			5,953
Net cost of net debt																	(107	)
Minority interests																	(132	)

Net income																	5,714

1^st half 2010 (adjustments) ^(a) (M€)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Non-Group sales
Intersegment sales
Excise taxes

Revenues from sales
Operating expenses		—			585			49			—						634
Depreciation, depletion and amortization of tangible assets and mineral interests		—			—			(8	)		—						(8	)

Operating income^(b)		—			585			41			—						626
Equity in income (loss) of affiliates and other items^(c)		(146	)		41			22			84						1
Tax on net operating income		43			(198	)		(9	)		(2	)					(166	)

Net operating income^(b)		(103	)		428			54			82						461
Net cost of net debt																	—
Minority interests																	(4	)

Net income																	457
(a) Adjustments include special items, inventory valuation effect and, until June 30,2010, equity share of adjustments related to Sanofi. (b) Of which inventory valuation effect

On operating income		—			635			65			—
On net operating income		—			467			50			—

(c) Of which equity share of adjustments related to Sanofi		—			—			—			(81	)


1^st half 2010 (adjusted) (M€) ^(a)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Non-Group sales		9,115			60,998			8,812			7			—			78,932
Intersegment sales		11,019			2,475			507			87			(14,088	)		—
Excise taxes		—			(9,444	)		—			—			—			(9,444	)

Revenues from sales		20,134			54,029			9,319			94			(14,088	)		69,488
Operating expenses		(8,818	)		(52,666	)		(8,602	)		(318	)		14,088			(56,316	)
Depreciation, depletion and amortization of tangible assets and mineral interests		(2,548	)		(623	)		(258	)		(19	)		—			(3,448	)

Adjusted operating income		8,768			740			459			(243	)		—			9,724
Equity in income (loss) of affiliates and other items		444			114			101			348			—			1,007
Tax on net operating income		(5,038	)		(216	)		(129	)		144			—			(5,239	)

Adjusted net operating income		4,174			638			431			249			—			5,492
Net cost of net debt																	(107	)
Minority interests																	(128	)

Adjusted net income																	5,257

Adjusted fully-diluted earnings per share (€)																	2.34

(a)

Except for per share amounts.


1^st half 2010 (M€)	Upstream		Downstream		Chemicals		Corporate			Intercompany	Total
Total expenditures		5,866		1,018		238		33				7,155
Total divestments		261		38		334		1,265				1,898
Cash flow from operating activities		8,834		1,496		387		(515	)			10,202

Consolidated Financial Statements as of June 30, 2011

Adjustments by business segment

(M€)

ADJUSTMENTS TO OPERATING INCOME


(M€)		Upstream			Downstream			Chemicals			Corporate			Total
2^nd quarter 2011	Inventory valuation effect		—			(72	)		(15	)		—			(87	)
	Effect of changes in fair value		(55	)		—			—			—			(55	)
	Restructuring charges		—			—			—			—			—
	Asset impairment charges		—			—			—			—			—
	Other items		—			(63	)		—			—			(63	)

Total			(55	)		(135	)		(15	)		—			(205	)

2^nd quarter 2010	Inventory valuation effect		—			255			(41	)		—			214
	Effect of changes in fair value		—			—			—			—			—
	Restructuring charges		—			—			—			—			—
	Asset impairment charges		—			—			(8	)		—			(8	)
	Other items		—			—			(16	)		—			(16	)

Total			—			255			(65	)		—			190


1^st half 2011	Inventory valuation effect		—			1,154			115			—			1,269
	Effect of changes in fair value		29			—			—			—			29
	Restructuring charges		—			—			—			—			—
	Asset impairment charges		—			—			—			—			—
	Other items		—			(63	)		—			—			(63	)

Total			29			1,091			115			—			1,235

1^st half 2010	Inventory valuation effect		—			635			65			—			700
	Effect of changes in fair value		—			—			—			—			—
	Restructuring charges		—			—			—			—			—
	Asset impairment charges		—			—			(8	)		—			(8	)
	Other items		—			(50	)		(16	)		—			(66	)

Total			—			585			41			—			626

ADJUSTMENTS TO NET INCOME GROUP SHARE
(M€)		Upstream			Downstream			Chemicals			Corporate			Total
2^nd quarter 2011	Inventory valuation effect		—			(57	)		(17	)		—			(74	)
	Effect of changes in fair value		(41	)		—			—			—			(41	)
TOTAL’s equity share of adjustments related to Sanofi			—			—			—			—			—
	Restructuring charges		—			—			—			—			—
	Asset impairment charges		(47	)		—			—			—			(47	)
	Gains (losses) on disposals of assets		164			—			—			41			205
	Other items		—			(45	)		(66	)		—			(111	)

Total			76			(102	)		(83	)		41			(68	)

2^nd quarter 2010	Inventory valuation effect		—			194			(25	)		—			169
	Effect of changes in fair value		—			—			—			—			—
TOTAL’s equity share of adjustments related to Sanofi			—			—			—			(40	)		(40	)
	Restructuring charges		—			—			(10	)		—			(10	)
	Asset impairment charges		—			—			(6	)		—			(6	)
	Gains (losses) on disposals of assets		—			—			29			34			63
	Other items		(27	)		—			(9	)		—			(36	)

Total			(27	)		194			(21	)		(6	)		140


1^st half 2011	Inventory valuation effect		—			777			95			—			872
	Effect of changes in fair value		22			—			—			—			22
TOTAL’s equity share of adjustments related to Sanofi			—			—			—			—			—
	Restructuring charges		—			—			—			—			—
	Asset impairment charges		(47	)		—			—			—			(47	)
	Gains (losses) on disposals of assets		164			—			—			52			216
	Other items		(178	)		(45	)		(66	)		—			(289	)

Total			(39	)		732			29			52			774

1^st half 2010	Inventory valuation effect		—			463			50			—			513
	Effect of changes in fair value		—			—			—			—			—
TOTAL’s equity share of adjustments related to Sanofi			—			—			—			(81	)		(81	)
	Restructuring charges		—			—			(10	)		—			(10	)
	Asset impairment charges		(59	)		—			(6	)		—			(65	)
	Gains (losses) on disposals of assets		—			—			29			163			192
	Other items		(44	)		(39	)		(9	)		—			(92	)

Total			(103	)		424			54			82			457

CONSOLIDATED STATEMENT OF INCOME (Impact of adjustments)

TOTAL

(unaudited)


2^nd quarter 2011 (M€)	Adjusted			Adjustments			Consolidated statement of income

Sales		45,064			(55	)		45,009
Excise taxes		(4,544	)		—			(4,544	)
Revenues from sales		40,520			(55	)		40,465

Purchases net of inventory variation		(28,299	)		(87	)		(28,386	)
Other operating expenses		(4,741	)		(63	)		(4,804	)
Exploration costs		(179	)		—			(179	)
Depreciation, depletion and amortization of tangible assets and mineral interests		(1,531	)		—			(1,531	)
Other income		35			211			246
Other expense		(70	)		(68	)		(138	)

Financial interest on debt		(159	)		—			(159	)
Financial income from marketable securities & cash equivalents		55			—			55
Cost of net debt		(104	)		—			(104	)

Other financial income		335			—			335
Other financial expense		(104	)		—			(104	)

Equity in income (loss) of affiliates		462			(18	)		444

Income taxes		(3,459	)		27			(3,432	)

Consolidated net income		2,865			(53	)		2,812
Group share		2,794			(68	)		2,726
Minority interests		71			15			86

2^nd quarter 2010 (M€)	Adjusted			Adjustments			Consolidated statement of income

Sales		41,329			—			41,329
Excise taxes		(5,002	)		—			(5,002	)
Revenues from sales		36,327			—			36,327

Purchases net of inventory variation		(24,143	)		214			(23,929	)
Other operating expenses		(4,817	)		(16	)		(4,833	)
Exploration costs		(292	)		—			(292	)
Depreciation, depletion and amortization of tangible assets and mineral interests		(1,749	)		(8	)		(1,757	)
Other income		52			62			114
Other expense		(61	)		(53	)		(114	)

Financial interest on debt		(113	)		—			(113	)
Financial income from marketable securities & cash equivalents		24			—			24
Cost of net debt		(89	)		—			(89	)

Other financial income		142			—			142
Other financial expense		(95	)		—			(95	)

Equity in income (loss) of affiliates		526			(13	)		513

Income taxes		(2,773	)		(46	)		(2,819	)

Consolidated net income		3,028			140			3,168
Group share		2,961			140			3,101
Minority interests		67			—			67

CONSOLIDATED STATEMENT OF INCOME (Impact of adjustments)

TOTAL

(unaudited)


1^st half 2011 (M€)	Adjusted			Adjustments			Consolidated statement of income

Sales		91,009			29			91,038
Excise taxes		(8,971	)		—			(8,971	)
Revenues from sales		82,038			29			82,067

Purchases net of inventory variation		(56,910	)		1,269			(55,641	)
Other operating expenses		(9,443	)		(63	)		(9,506	)
Exploration costs		(438	)		—			(438	)
Depreciation, depletion and amortization of tangible assets and mineral interests		(3,217	)		—			(3,217	)
Other income		109			222			331
Other expense		(129	)		(68	)		(197	)

Financial interest on debt		(295	)		—			(295	)
Financial income from marketable securities & cash equivalents		102			—			102
Cost of net debt		(193	)		—			(193	)

Other financial income		410			—			410
Other financial expense		(212	)		—			(212	)

Equity in income (loss) of affiliates		929			21			950

Income taxes		(6,880	)		(624	)		(7,504	)

Consolidated net income		6,064			786			6,850
Group share		5,898			774			6,672
Minority interests		166			12			178

1^st half 2010 (M€)	Adjusted			Adjustments			Consolidated statement of income

Sales		78,932			—			78,932
Excise taxes		(9,444	)		—			(9,444	)
Revenues from sales		69,488			—			69,488

Purchases net of inventory variation		(46,330	)		700			(45,630	)
Other operating expenses		(9,479	)		(66	)		(9,545	)
Exploration costs		(507	)		—			(507	)
Depreciation, depletion and amortization of tangible assets and mineral interests		(3,448	)		(8	)		(3,456	)
Other income		80			194			274
Other expense		(167	)		(159	)		(326	)

Financial interest on debt		(213	)		—			(213	)
Financial income from marketable securities & cash equivalents		48			—			48
Cost of net debt		(165	)		—			(165	)

Other financial income		213			—			213
Other financial expense		(190	)		—			(190	)

Equity in income (loss) of affiliates		1,071			(34	)		1,037

Income taxes		(5,181	)		(166	)		(5,347	)

Consolidated net income		5,385			461			5,846
Group share		5,257			457			5,714
Minority interests		128			4			132

TOTAL

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE FIRST SIX MONTHS OF 2011

(unaudited)

1) Accounting policies

Accounting policies applicable in 2011

The interim consolidated financial statements of TOTAL S.A. and its subsidiaries (the Group) as of June 30, 2011 are presented in Euros and have been prepared in accordance with International Accounting Standard (IAS) 34 “Interim Financial Reporting”. The accounting policies applied for the consolidated financial statements as of June 30, 2011 do not differ significantly from those applied for the consolidated financial statements as of December 31, 2010 which have been prepared on the basis of IFRS (International Financial Reporting Standards) as adopted by the European Union and IFRS as issued by the IASB (International Accounting Standard Board). The new accounting standards and amendments mandatory for the annual period beginning January 1, 2011 are described in Note 1W to the consolidated financial statements as of December 31, 2010 and have no material effect on the Group’s consolidated financial statements for the first six months of 2011.

The preparation of financial statements in accordance with IFRS requires the management to make estimates and assumptions that affect the reported amounts of assets, liabilities and contingent liabilities at the date of preparation of the financial statements and reported income and expenses for the period. The management reviews these estimates and assumptions on an ongoing basis, by reference to past experience and various other factors considered as reasonable which form the basis for assessing the carrying amount of assets and liabilities. Actual results may differ significantly from these estimates, if different assumptions or circumstances apply. These judgments and estimates relate principally to the application of the successful efforts method for the oil and gas accounting, the valuation of long-lived assets, the provisions for asset retirement obligations and environmental remediation, the pensions and post-retirement benefits and the income tax computation. These estimates and assumptions are described in the Notes to the consolidated financial statements as of December 31, 2010.

Furthermore, when the accounting treatment of a specific transaction is not addressed by any accounting standard or interpretation, the management applies its judgment to define and apply accounting policies that will lead to relevant and reliable information, so that the financial statements:

•

give a true and fair view of the Group’s financial position, financial performance and cash flows;

•

reflect the substance of transactions;

•

are neutral;

•

are prepared on a prudent basis; and

•

are complete in all material aspects.

Pursuant to the accrual basis of accounting followed by the Group, the financial statements reflect the effects of transactions and other events when they occur. Assets and liabilities such as property, plant and equipment and intangible assets are usually measured at amortized cost. Financial assets and liabilities are usually measured at fair value.

Accounting policies not yet applicable

In May 2011, the IASB issued a package of standards on consolidation : standard IFRS 10 “Consolidated financial statements”, standard IFRS 11 “Joint arrangements”, standard IFRS 12 “Disclosure of interests in other entities”, revised standard IAS 27 “Separate financial statements” and revised standard IAS 28 “Investments in associates and joint ventures”. These standards are applicable for annual periods beginning on or after January 1, 2013.

In June 2011, the IASB issued revised standard IAS 19 “Employee benefits”, which leads in particular to the full recognition of the net position in respect of employee benefits obligations (liabilities net of assets) in the balance sheet and the elimination of the corridor approach currently used by the Group. This standard is applicable for annual periods beginning on or after January 1, 2013.

In addition, the IASB published in May 2011 standard IFRS 13 “Fair value measurement”, applicable for annual periods beginning on or after January 1, 2013, and in June 2011 revised standard IAS 1 “Presentation of financial statements”, applicable for annual periods beginning on or after July 1, 2012.

The impact of the application of these standards is currently assessed by the Group.

2) Changes in the Group structure, main acquisitions and divestments

Upstream

•

TOTAL finalized in March 2011 the acquisition from Santos of an additional 7.5% interest in Australia’s GLNG project. This increases TOTAL’s overall stake in the project to 27.5%.

The acquisition cost amounts to €200 million ($281 million) and mainly corresponds to the value of mineral interests that have been recognized as intangible assets on the face of the consolidated balance sheet for €203 million.

•

In March 2011, Total E&P Canada Ltd., a TOTAL subsidiary, and Suncor Energy Inc. (Suncor) have finalized a strategic oil sands alliance encompassing the Suncor-operated Fort Hills mining project, the TOTAL-operated Joslyn mining project and the Suncor-operated Voyageur upgrader project. All three assets are located in the Athabasca region of the province of Alberta, in Canada.

TOTAL acquired 19.2% of Suncor’s interest in the Fort Hills project, increasing TOTAL’s overall interest in the project to 39.2%. Suncor, as operator, holds 40.8%. TOTAL also acquired a 49% stake in the Suncor-operated Voyageur upgrader project. For those two acquisitions, the Group paid €1,945 million (CAD 2,666 million) mainly representing the value of mineral interests for €445 million and the value of tangible assets for €1,473 million.

Furthermore, TOTAL sold to Suncor 36.75% interest in the Joslyn project for €614 million (CAD 842 million), and received the cash payment in April 2011. The Group, as operator, retains a 38.25% interest in the project.

•

TOTAL finalized in April 2011 the sale of its 75.8% interest in its upstream Cameroonian affiliate Total E&P Cameroun to Perenco, for an amount of €171 million ($244 million), net of cash sold.

•

TOTAL and the Russian company Novatek signed in March 2011 two Memorandums of Cooperation to develop the cooperation between TOTAL on one side, and Novatek and its main shareholders on the other side.

This cooperation is developed around two transactions:

•

TOTAL took a 12.09% shareholding in Novatek. This transaction has been effective since April 1, 2011 and amounted to €2,901 million ($4,108 million). TOTAL considers that it has a significant influence through its representation on the Board of Directors of Novatek and its participation in the Yamal LNG project. Therefore, the interest in Novatek is accounted for by the equity method as from the second quarter 2011.

•

TOTAL will become the main international partner on the Yamal LNG project holding a 20% share, and Novatek will hold a 51% interest in the project. The signature of definitive agreements should occur during the third quarter of 2011.

•

After the all-cash tender of $23.25 per share launched on April 28, 2011 and completed on June 21, 2011, TOTAL has acquired a 60% stake in SunPower Corp., a U.S. company listed on Nasdaq with headquarters in San Jose (California), one of the most established players in the American solar industry. Shares of SunPower Corp. continue to be traded on the Nasdaq.

As of completion date (June 21, 2011), the public offer has led, on the basis of acceptances received, to a cash settlement of $1,394 million (€974 million).

As part of the transaction, various agreements were signed, including a financial guarantee agreement through which TOTAL guarantees up to $1 billion SunPower’s repayments obligations under letters of credit that would be issued during the next five years for the development of solar power plants and large roofs activities.

Furthermore, after the closing of the offer, antitrust authorities of the European Commission have given their approval to the transaction on June 28, 2011; U.S. antitrust authorities had, on their side, given their approval to the transaction at the end of May 2011.

The composition of SunPower’s Board of Directors has been modified (on July 1, 2011), with the appointment of six members representing TOTAL among eleven directors.

As TOTAL took control of SunPower after the closing of the offer, at a date very close to the balance sheet date of June 30, 2011, the Group could not carry out the usual diligences on the accounts of acquired companies for their inclusion in the consolidated financial statements as of June 30, 2011.

As a result, acquired shares have been temporarily classified as “Other investments” on the face of the consolidated balance sheet for €974 million. The purchase price allocation, the measurement of goodwill,

of assets acquired and liabilities assumed at acquisition date and of fair value adjustments determined temporarily will be presented in the second half of 2011.

The carrying amount of the main balance sheet indicators as they appear in the latest quarterly statements prepared under U.S. GAAP (before fair value adjustments and restatements to TOTAL’s standards) and published by SunPower Corp. (unaudited figures) as of March 31, 2011 is as follows:


	In million $		In million €
Non current assets		1,661		1,169
Current assets		1,804		1,270

Total Assets		3,465		2,439


Equity		1,627		1,145
Non current liabilities		791		557
Current liabilities		1,047		737

Total Liabilities		3,465		2,439

3) Adjustment items

Financial information by business segment is reported in accordance with the internal reporting system and shows internal segment information that is used to manage and measure the performance of TOTAL.

Performance indicators excluding the adjustment items, such as adjusted operating income, adjusted net operating income, and adjusted net income are meant to facilitate the analysis of the financial performance and the comparison of income between periods.

Adjustment items include:

(i) Special items

Due to their unusual nature or particular significance, certain transactions qualified as “special items” are excluded from the business segment figures. In general, special items relate to transactions that are significant, infrequent or unusual. However, in certain instances, transactions such as restructuring costs or asset disposals, which are not considered to be representative of the normal course of business, may be qualified as special items although they may have occurred within prior years or are likely to occur again within the coming years.

(ii) Inventory valuation effect

The adjusted results of the Downstream and Chemicals segments are presented according to the replacement cost method. This method is used to assess the segments’ performance and facilitate the comparability of the segments’ performance with those of its competitors.

In the replacement cost method, which approximates the LIFO (Last-In, First-Out) method, the variation of inventory values in the statement of income is, depending on the nature of the inventory, determined using either the month-end prices differential between one period and another or the average prices of the period rather than the historical value. The inventory valuation effect is the difference between the results according to the FIFO (First-In, First-Out) and the replacement cost.

(iii) Effect of changes in fair value

As from January 1, 2011, the effect of changes in fair value presented as adjustment item reflects for some transactions differences between internal measure of performance used by TOTAL’s management and the accounting for these transactions under IFRS.

IFRS requires that trading inventories be recorded at their fair value using period end spot prices. In order to best reflect the management of economic exposure through derivative transactions, internal indicators used to measure performance include valuations of trading inventories based on forward prices.

Furthermore, TOTAL, in its trading activities, enters into storage contracts, which future effects are recorded at fair value in Group’s internal economic performance. IFRS precludes recognition of this fair value effect.

(iv) Until June 30, 2010, TOTAL’s equity share of adjustment items reconciling “Business net income” to Net income attributable to equity holders of Sanofi

The adjusted results (adjusted operating income, adjusted net operating income, adjusted net income) are defined as replacement cost results, adjusted for special items, excluding the effect of changes in fair value as from January 1, 2011 and excluding TOTAL’s equity share of adjustment items related to Sanofi until June 30, 2010.

The detail of the adjustment items is presented in the table below.

ADJUSTMENTS TO OPERATING INCOME


(M€)		Upstream			Downstream			Chemicals			Corporate		Total
2^ndquarter 2011	Inventory valuation effect		—			(72	)		(15	)		—		(87	)
	Effect of changes in fair value		(55	)		—			—			—		(55	)
	Restructuring charges		—			—			—			—		—
	Asset impairment charges		—			—			—			—		—
	Other items		—			(63	)		—			—		(63	)

Total			(55	)		(135	)		(15	)		—		(205	)

2^ndquarter 2010	Inventory valuation effect		—			255			(41	)		—		214
	Effect of changes in fair value		—			—			—			—		—
	Restructuring charges		—			—			—			—		—
	Asset impairment charges		—			—			(8	)		—		(8	)
	Other items		—			—			(16	)		—		(16	)

Total			—			255			(65	)		—		190


1^sthalf 2011	Inventory valuation effect		—			1,154			115			—		1,269
	Effect of changes in fair value		29			—			—			—		29
	Restructuring charges		—			—			—			—		—
	Asset impairment charges		—			—			—			—		—
	Other items		—			(63	)		—			—		(63	)

Total			29			1,091			115			—		1,235

1^sthalf 2010	Inventory valuation effect		—			635			65			—		700
	Effect of changes in fair value		—			—			—			—		—
	Restructuring charges		—			—			—			—		—
	Asset impairment charges		—			—			(8	)		—		(8	)
	Other items		—			(50	)		(16	)		—		(66	)

Total			—			585			41			—		626

ADJUSTMENTS TO NET INCOME GROUP SHARE


(M€)		Upstream			Downstream			Chemicals			Corporate			Total
2^ndquarter 2011	Inventory valuation effect		—			(57	)		(17	)		—			(74	)
	Effect of changes in fair value		(41	)		—			—			—			(41	)
TOTAL’s equity share of adjustments related to Sanofi			—			—			—			—			—
	Restructuring charges		—			—			—			—			—
	Asset impairment charges		(47	)		—			—			—			(47	)
	Gains (losses) on disposals of assets		164			—			—			41			205
	Other items		—			(45	)		(66	)		—			(111	)

Total			76			(102	)		(83	)		41			(68	)

2^ndquarter 2010	Inventory valuation effect		—			194			(25	)		—			169
	Effect of changes in fair value		—			—			—			—			—
TOTAL’s equity share of adjustments related to Sanofi			—			—			—			(40	)		(40	)
	Restructuring charges		—			—			(10	)		—			(10	)
	Asset impairment charges		—			—			(6	)		—			(6	)
	Gains (losses) on disposals of assets		—			—			29			34			63
	Other items		(27	)		—			(9	)		—			(36	)

Total			(27	)		194			(21	)		(6	)		140


1^sthalf 2011	Inventory valuation effect		—			777			95			—			872
	Effect of changes in fair value		22			—			—			—			22
TOTAL’s equity share of adjustments related to Sanofi			—			—			—			—			—
	Restructuring charges		—			—			—			—			—
	Asset impairment charges		(47	)		—			—			—			(47	)
	Gains (losses) on disposals of assets		164			—			—			52			216
	Other items		(178	)		(45	)		(66	)		—			(289	)

Total			(39	)		732			29			52			774

1^sthalf 2010	Inventory valuation effect		—			463			50			—			513
	Effect of changes in fair value		—			—			—			—			—
TOTAL’s equity share of adjustments related to Sanofi			—			—			—			(81	)		(81	)
	Restructuring charges		—			—			(10	)		—			(10	)
	Asset impairment charges		(59	)		—			(6	)		—			(65	)
	Gains (losses) on disposals of assets		—			—			29			163			192
	Other items		(44	)		(39	)		(9	)		—			(92	)

Total			(103	)		424			54			82			457

In the first half of 2011, the heading “Other items” includes the impact of the change in taxation in the United Kingdom on the deferred tax liability for €(178) million. The House of Commons voted provisionally the increase of the Supplementary charge applicable to oil activities from 20% to 32%, pending a final vote of the Finance Act 2011.

4) Shareholders’ equity

Treasury shares (TOTAL shares held by TOTAL S.A.)

As of June 30, 2011, TOTAL S.A. held 12,152,607 of its own shares, representing 0.51% of its share capital, detailed as follows:

•

6,009,532 shares allocated to TOTAL restricted shares plans for Group employees; and

•

6,143,075 shares intended to be allocated to new TOTAL share purchase option plans or to new restricted shares plans.

These 12,152,607 shares are deducted from the consolidated shareholders’ equity.

Treasury shares (TOTAL shares held by Group subsidiaries)

As of June 30, 2011, TOTAL S.A. held indirectly through its subsidiaries 100,331,268 of its own shares, representing 4.25% of its share capital, detailed as follows:

•

2,023,672 shares held by a consolidated subsidiary, Total Nucléaire, 100% indirectly held by TOTAL S.A.;

•

98,307,596 shares held by subsidiaries of Elf Aquitaine (Financière Valorgest, Sogapar and Fingestval).

These 100,331,268 shares are deducted from the consolidated shareholders’ equity.

Dividend

The shareholders’ meeting of May 13, 2011 approved the payment of a cash dividend of €2.28 per share for the fiscal year 2010. Taking into account an interim dividend of €1.14 per share paid on November 17, 2010, the remaining balance of €1.14 per share was paid on May 26, 2011.

The Board of Directors of October 28, 2010 decided to pay interim dividends on a quarterly basis beginning in fiscal year 2011. The Board of Directors of April 28, 2011 and the one of July 28, 2011 approved interim dividends of €0.57 per share for first quarter 2011 and €0.57 per share for second quarter 2011, that will be paid on September 22 and December 22, 2011 respectively.

Other Comprehensive Income

Detail of other comprehensive income showing items reclassified from equity to net income is presented in the table below:


(M€)	1st half 2011					1st half 2010

Currency translation adjustment				(2,644	)				4,996
- unrealized gain/(loss) of the period		(2,633	)				4,999
- less gain/(loss) included in net income		11					3

Available for sale financial assets				430					(52	)
- unrealized gain/(loss) of the period		433					(3	)
- less gain/(loss) included in net income		3					49

Cash flow hedge				(35	)				(51	)
- unrealized gain/(loss) of the period		38					(347	)
- less gain/(loss) included in net income		73					(296	)

Share of other comprehensive income of equity affiliates, net amount				(103	)				475

Other				(2	)				3
- unrealized gain/(loss) of the period		(2	)				3
- less gain/(loss) included in net income		—					—

Tax effect				(29	)				18


Total other comprehensive income, net amount				(2,383	)				5,389

Tax effects relating to each component of other comprehensive income are as follows:


	1st half 2011									1st half 2010
(M€)	Pre-tax amount			Tax effect			Net amount			Pre-tax amount			Tax effect		Net amount
Currency translation adjustment		(2,644	)					(2,644	)		4,996					4,996
Available for sale financial assets		430			(41	)		389			(52	)		1		(51	)
Cash flow hedge		(35	)		12			(23	)		(51	)		17		(34	)
Share of other comprehensive income of equity affiliates, net amount		(103	)					(103	)		475					475
Other		(2	)					(2	)		3					3


Total other comprehensive income		(2,354	)		(29	)		(2,383	)		5,371			18		5,389

5) Financial debt

The Group issued bonds through its subsidiaries Total Capital and Total Capital Canada Ltd. during the first six months of 2011:

•

Bond 6.500% 2011-2016 (150 million AUD)

•

Bond 3.875% 2011-2018 (500 million GBP)

•

Bond 4.125% 2011-2021 (500 million USD)

•

Bond 1.625% 2011-2014 (750 million USD)

•

Bond Libor USD 3 months + 0.380% 2011-2014 (750 million USD)

•

Bond 5.750% 2011-2014 (100 million AUD)

•

Bond Libor USD 3 months + 0.09% 2011-2013 (1,000 million USD)

The Group reimbursed bonds during the first six months of 2011:

•

Bond 5.750% 2005-2011 (100 million AUD)

•

Bond 4.000% 2005-2011 (100 million CAD)

•

Bond 5.750% 2004-2011 (100 million AUD)

•

Bond 7.500% 2008-2011 (150 million AUD)

In the context of its active cash management, the Group may temporarily increase its current borrowings, particularly in the form of commercial paper. The changes in current borrowings, cash and cash equivalents and current financial assets resulting from this cash management in the quarterly financial statements are not necessarily representative of a longer-term position.

6) Related parties

The related parties are principally equity affiliates and non-consolidated investments. There were no major changes concerning transactions with related parties during the first six months of 2011.

7) Other risks and contingent liabilities

TOTAL is not currently aware of any exceptional event, dispute, risks or contingent liabilities that could have a material impact on the assets and liabilities, results, financial position or operations of the Group.

Antitrust investigations

During the first half of 2011, the Group has not been fined pursuant to a Court ruling. The principal antitrust proceedings in which the Group’s companies are involved are described thereafter.

Chemicals segment

•

As part of the spin-off of Arkema¹ in 2006, TOTAL S.A. or certain other Group companies agreed to grant Arkema guarantees for potential monetary consequences related to antitrust proceedings arising from events prior to the spin-off.

These guarantees cover, for a period of ten years, 90% of amounts paid by Arkema related to (i) fines imposed by European authorities or European member-states for competition law violations, (ii) fines imposed by U.S. courts or antitrust authorities for federal antitrust violations or violations of the competition laws of U.S. states, (iii) damages awarded in civil proceedings related to the government proceedings mentioned above, and (iv) certain costs related to these proceedings. The guarantee related to anti-competition violations in Europe applies to amounts above a €176.5 million threshold. On the other hand, the agreements provide that Arkema will indemnify TOTAL S.A. or any Group company for 10% of any amount that TOTAL S.A. or any Group company are required to pay under any of the proceedings covered by these guarantees.

If one or more individuals or legal entities, acting alone or together, directly or indirectly holds more than one-third of the voting rights of Arkema, or if Arkema transfers more than 50% of its assets (as calculated under the enterprise valuation method, as of the date of the transfer) to a third party or parties acting together, irrespective of the type or number of transfers, these guarantees will become void.

¹	Arkema is used in this section to designate those companies of the Arkema group whose ultimate parent company is Arkema S.A. Arkema became an independent company after being spun-off from TOTAL S.A. in May 2006.

•

In the United States, investigations into certain commercial practices of some subsidiaries of the Arkema group have been closed since 2007; no charges have been brought against Arkema. Civil liability lawsuits, for which TOTAL S.A. has been named as the parent company, are about to be closed and are not expected to have a significant impact on the Group’s financial position.

•

In Europe, since 2006, the European Commission has fined companies of the Group in its configuration prior to the spin-off an overall amount of €385.47 million, of which Elf Aquitaine and/or TOTAL S.A. were held jointly liable for €280.17 million, Elf Aquitaine being personally fined €23.6 million for deterrence. These fines are entirely settled as of today.

As a result, since the spin-off, the Group has paid the overall amount of €188.07 million², corresponding to 90% of the fines overall amount once the threshold provided for by the guarantee is deducted.

The European Commission imposed these fines following investigations between 2000 and 2004 into commercial practices involving eight products sold by Arkema. Five of these investigations resulted in prosecutions from the European Commission for which Elf Aquitaine has been named as the parent company, and two of these investigations named TOTAL S.A. as the ultimate parent company of the Group.

TOTAL S.A. and Elf Aquitaine are contesting their liability based solely on their status as parent companies and appealed for cancellation and reformation of the rulings that are still pending before the relevant EU court of appeals or supreme court of appeals. Within the framework of one of these proceedings, the General Court of the European Union, in a decision dated June 7, 2011, partially accepted Arkema’s appeal, reducing the fine pronounced against it by the amount of €105.79 million. On the same day, the General Court rejected the appeal lodged by TOTAL S.A. and Elf Aquitaine. Considering the latter remain liable for Arkema’s infringement, the European Commission demanded the payment of €105.79 million (plus interest of €31.31 million). Elf Aquitaine paid these amounts in July 2011. Lodging an appeal is being considered.

Besides, civil proceedings against Arkema and other groups of companies were initiated before German and Dutch courts by third parties for alleged damages pursuant to two of the above described legal proceedings engaged by the European Commission. TOTAL S.A. was summoned to serve notice of the dispute before the German court. At this point, the probability to have a favorable verdict and the financial impacts of these procedures are uncertain due to the number of legal difficulties they gave rise to, the lack of documented claims and the complex evaluation of the alleged damages.

Arkema began implementing compliance procedures in 2001 that are designed to prevent its employees from violating antitrust provisions. However, it is not possible to exclude the possibility that the relevant authorities could commence additional proceedings involving Arkema regarding events prior to the spin-off, as well as Elf Aquitaine and/or TOTAL S.A. based on their status as parent company.

Within the framework of the legal proceedings described above, a €17 million reserve remains booked in the Group’s consolidated financial statements as of June 30, 2011.

Downstream segment

•

Pursuant to a statement of objections received by Total Nederland N.V. and TOTAL S.A. (based on its status as parent company) from the European Commission, Total Nederland N.V. was fined in 2006 €20.25 million, which has been paid, and for which TOTAL S.A. was held jointly liable for €13.5 million. TOTAL S.A. appealed this decision before the relevant court and this appeal is still pending.

In addition, pursuant to a statement of objections received by Total Raffinage Marketing (formerly Total France) and TOTAL S.A. from the European Commission regarding another product line of the Refining & Marketing division, Total Raffinage Marketing was fined €128.2 million in 2008, which has been paid, and for which TOTAL S.A. was held jointly liable based on its status as parent company. TOTAL S.A. also appealed this decision before the relevant court and this appeal is still pending.

•

Finally, TotalGaz and Total Raffinage Marketing received a statement of objections in July 2009 from the French Antitrust Authority (Autorité de la concurrence française) regarding alleged antitrust practices concerning another product line of the Refining & Marketing division. The case was dismissed by decision of the French antitrust authorities on December 17, 2010.

Whatever the evolution of the investigations and proceedings described above, the Group believes that their outcome should not have a material adverse effect on the Group’s financial situation or consolidated results.

²	This amount does not take into account a case that led to Arkema, prior to Arkema’s spin-off from TOTAL, and Elf Aquitaine being fined jointly €45 million and Arkema being fined €13.5 million.

Buncefield

On December 11, 2005, several explosions, followed by a major fire, occurred at an oil storage depot at Buncefield, north of London. This depot was operated by Hertfordshire Oil Storage Limited (HOSL), a company in which TOTAL’s UK subsidiary holds 60% and another oil group holds 40%.

The explosion caused injuries, most of which were minor injuries, to a number of people and caused property damage to the depot and the buildings and homes located nearby. The official Independent Investigation Board has indicated that the explosion was caused by the overflow of a tank at the depot. The Board’s final report was released on December 11, 2008. The civil procedure for claims, which had not yet been settled, took place between October and December 2008. The Court’s decision of March 20, 2009, declared TOTAL’s UK subsidiary liable for the accident and solely liable for indemnifying the victims. The subsidiary appealed the decision. The appeal trial took place in January 2010. The Court of Appeals, by a decision handed down on March 4, 2010, confirmed the prior judgment. The Supreme Court of United Kingdom has partially authorized TOTAL’s UK subsidiary to contest the decision. TOTAL’s UK subsidiary finally decided to withdraw from this recourse due to settlement agreements reached in mid-February 2011.

The Group carries insurance for damage to its interests in these facilities, business interruption and civil liability claims from third parties. The provision for the civil liability that appears in the Group’s consolidated financial statements as of June 30, 2011, stands at €96 million after taking into account the payments previously made.

The Group believes that, based on the information currently available, on a reasonable estimate of its liability and on provisions recognized, this accident should not have a significant impact on the Group’s financial situation or consolidated results.

In addition, on December 1, 2008, the Health and Safety Executive (HSE) and the Environment Agency (EA) issued a Notice of prosecution against five companies, including TOTAL’s UK subsidiary. By a judgment on July 16, 2010, the subsidiary was fined £3.6 million and paid it. The decision takes into account a number of elements that have mitigated the impact of the charges brought against it.

Erika

Following the sinking in December 1999 of the Erika, a tanker that was transporting products belonging to one of the Group companies, the Tribunal de grande instance of Paris convicted TOTAL S.A. of marine pollution pursuant to a judgment issued on January 16, 2008, finding that TOTAL S.A. was negligent in its vetting procedure for vessel selection, and ordering TOTAL S.A. to pay a fine of €375,000. The court also ordered compensation to be paid to those affected by the pollution from the Erika up to an aggregate amount of €192 million, declaring TOTAL S.A. jointly and severally liable for such payments together with the Erika’s inspection and classification firm, the Erika’s owner and the Erika’s manager.

TOTAL has appealed the verdict of January 16, 2008. In the meantime, it nevertheless proposed to pay third parties who so requested definitive compensation as determined by the court. Forty-two third parties have been compensated for an aggregate amount of €171.5 million.

By a decision dated March 30, 2010, the Court of Appeal of Paris upheld the lower court verdict pursuant to which TOTAL S.A. was convicted of marine pollution and fined €375,000. TOTAL appealed this decision to the French Supreme Court (Cour de cassation).

However, the Court of Appeal ruled that TOTAL S.A. bears no civil liability according to the applicable international conventions and consequently ruled that TOTAL S.A. be not convicted.

TOTAL S.A. believes that, based on the information currently available, the case should not have a significant impact on the Group’s financial situation or consolidated results.

Blue Rapid and the Russian Olympic Committee – Russian regions and Interneft

Blue Rapid, a Panamanian company, and the Russian Olympic Committee filed a claim for damages with the Paris Commercial Court against Elf Aquitaine, alleging a so-called non-completion by a former subsidiary of Elf Aquitaine of a contract related to an exploration and production project in Russia negotiated in the early 1990s. Elf Aquitaine believed this claim to be unfounded and opposed it. On January 12, 2009, the Commercial Court of Paris rejected Blue Rapid’s claim against Elf Aquitaine and found that the Russian Olympic Committee did not have standing in the matter. Blue Rapid and the Russian Olympic Committee appealed this decision. On June 30, 2011, the Court of Appeal of Paris dismissed as inadmissible the claim of Blue Rapid and the Russian Olympic Committee against Elf Aquitaine, notably on the grounds of the contract’s termination.

In connection with the same facts, and fifteen years after the termination of the exploration and production contract, a Russian company, which was held not to be the contracting party to the contract, and two regions of the Russian Federation which were not even parties to the contract, have launched an arbitration procedure against the aforementioned former subsidiary of Elf Aquitaine that was liquidated in 2005, claiming alleged damages of U.S.$ 22.4 billion. For the same reasons as those successfully adjudicated by Elf Aquitaine against Blue Rapid and the

Russian Olympic Committee, the Group considers this claim to be unfounded as to a matter of law or fact. The Group has lodged a criminal complaint to denounce the fraudulent claim which the Group believes it is a victim of and, has taken and reserved its rights to take other actions and measures to defend its interests.

Iran

In 2003, the United States Securities and Exchange Commission (SEC) followed by the Department of Justice (DoJ) issued a formal order directing an investigation in connection with the pursuit of business in Iran, by certain oil companies including, among others, TOTAL.

The inquiry concerns an agreement concluded by the Company with a consultant concerning a gas field in Iran and aims to verify whether certain payments made under this agreement would have benefited Iranian officials in violation of the Foreign Corrupt Practices Act (FCPA) and the Company’s accounting obligations.

Investigations are still pending and the Company is cooperating with the SEC and the DoJ. In 2010, the Company opened talks with U.S. authorities, without any acknowledgement of facts, to consider an out-of-court settlement. Generally, out-of-court settlements with U.S. authorities include payment of fines and the obligation to improve internal compliance systems or other measures.

In this same case, a judicial inquiry related to TOTAL was initiated in France in 2006. In 2007, the Company’s Chief Executive Officer was placed under formal investigation in relation to this inquiry, as the former President of the Middle East department of the Group’s Exploration & Production division. The Company has not been notified of any significant developments in the proceedings since the formal investigation was launched.

At this point, the Company cannot determine when these investigations will terminate, and cannot predict their results, or the outcome of the talks that have been initiated, or the costs of a potential out-of-court settlement. Resolving this case is not expected to have a significant impact on the Group’s financial situation or any impact on its future planned operations.

Libya

Having regard to the context in Libya, the Group’s production in Libya has been stopped since early March. The Group continues mitigating the consequences of such situation on its operations and projects in Libya.

In addition, since February 2011, several embargo and sanction regimes have been imposed by the United Nations, as well as the EU and US authorities prohibiting certain financial and assets transactions with respect to a list of individuals and to various Libyan banks and other entities linked with the regime. TOTAL has taken all necessary steps not to contravene with these measures and believes that it does not carry out any activities in contravention of these measures.

Lastly, in June 2011, the United States Securities and Exchange Commission (SEC) issued to certain oil companies - including, among others, TOTAL - a formal request for information related to their operations in Libya. TOTAL is cooperating with this non public investigation.

Syria

Since May 10, 2011, the European Union adopted measures prohibiting the supply of certain equipment to Syria, as well as prohibiting certain financial and asset transactions with respect to a list of named individuals and entities. These measures apply to European persons and to entities constituted under the laws of a EU Member State. TOTAL does not believe that its current business activities in Syria are in contravention of these measures.

During the first half of 2011, the Group’s activities have not been significantly impacted by the deterioration of the security context in Syria.

Yemen

During the first half of 2011, the Group’s activities have not been significantly impacted by the deterioration of the security context in Yemen.

Commitments

In the Upstream, the Group has signed during the first half of 2011 guarantees in respect of construction contracts for an amount of about €2.9 billion.

8) Information by business segment


1^st half 2011 (M€)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Non-Group sales		11,310			69,320			10,396			12			—			91,038
Intersegment sales		13,280			3,117			642			84			(17,123	)		—
Excise taxes		—			(8,971	)		—			—			—			(8,971	)

Revenues from sales		24,590			63,466			11,038			96			(17,123	)		82,067
Operating expenses		(11,010	)		(61,242	)		(10,142	)		(314	)		17,123			(65,585	)
Depreciation, depletion and amortization of tangible assets and mineral interests		(2,340	)		(619	)		(241	)		(17	)		—			(3,217	)

Operating income		11,240			1,605			655			(235	)		—			13,265
Equity in income (loss) of affiliates and other items		816			96			100			270			—			1,282
Tax on net operating income		(6,802	)		(471	)		(241	)		(53	)		—			(7,567	)

Net operating income		5,254			1,230			514			(18	)		—			6,980
Net cost of net debt																	(130	)
Minority interests																	(178	)

Net income																	6,672

1^st half 2011 (adjustments) ^(a) (M€)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Non-Group sales		29			—			—			—						29
Intersegment sales
Excise taxes

Revenues from sales		29			—			—			—						29
Operating expenses		—			1,091			115			—						1,206
Depreciation, depletion and amortization of tangible assets and mineral interests		—			—			—			—						—

Operating income ^(b)		29			1,091			115			—						1,235
Equity in income (loss) of affiliates and other items		121			12			(12	)		54						175
Tax on net operating income		(202	)		(346	)		(74	)		(2	)					(624	)

Net operating income ^(b)		(52	)		757			29			52						786
Net cost of net debt																	—
Minority interests																	(12	)

Net income																	774

(a) Adjustments include special items, inventory valuation effect and, as from January 1^st , 2011, the effect of changes in fair value.
(b) Of which inventory valuation effect

On operating income		—			1,154			115			—
On net operating income		—			802			95			—

1^sthalf 2011 (adjusted) (M€) ^(a)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Non-Group sales		11,281			69,320			10,396			12			—			91,009
Intersegment sales		13,280			3,117			642			84			(17,123	)		—
Excise taxes		—			(8,971	)		—			—			—			(8,971	)

Revenues from sales		24,561			63,466			11,038			96			(17,123	)		82,038
Operating expenses		(11,010	)		(62,333	)		(10,257	)		(314	)		17,123			(66,791	)
Depreciation, depletion and amortization of tangible assets and mineral interests		(2,340	)		(619	)		(241	)		(17	)		—			(3,217	)

Adjusted operating income		11,211			514			540			(235	)		—			12,030
Equity in income (loss) of affiliates and other items		695			84			112			216			—			1,107
Tax on net operating income		(6,600	)		(125	)		(167	)		(51	)		—			(6,943	)

Adjusted net operating income		5,306			473			485			(70	)		—			6,194
Net cost of net debt																	(130	)
Minority interests																	(166	)

Adjusted net income																	5,898

Adjusted fully-diluted earnings per share (€)																	2.62


(a) Except for per share amounts.

1^sthalf 2011 (M€)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Total expenditures		12,100			726			380			47						13,253
Total divestments		1,256			51			26			668						2,001
Cash flow from operating activities		10,248			1,165			(6	)		(629	)					10,778


1^sthalf 2010 (M€)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Non-Group sales		9,115			60,998			8,812			7			—			78,932
Intersegment sales		11,019			2,475			507			87			(14,088	)		—
Excise taxes		—			(9,444	)		—			—			—			(9,444	)

Revenues from sales		20,134			54,029			9,319			94			(14,088	)		69,488
Operating expenses		(8,818	)		(52,081	)		(8,553	)		(318	)		14,088			(55,682	)
Depreciation, depletion and amortization of tangible assets and mineral interests		(2,548	)		(623	)		(266	)		(19	)		—			(3,456	)

Operating income		8,768			1,325			500			(243	)		—			10,350
Equity in income (loss) of affiliates and other items		298			155			123			432			—			1,008
Tax on net operating income		(4,995	)		(414	)		(138	)		142			—			(5,405	)

Net operating income		4,071			1,066			485			331			—			5,953
Net cost of net debt																	(107	)
Minority interests																	(132	)

Net income																	5,714

1^sthalf 2010 (adjustments) ^(a) (M€)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Non-Group sales
Intersegment sales
Excise taxes

Revenues from sales
Operating expenses		—			585			49			—						634
Depreciation, depletion and amortization of tangible assets and mineral interests		—			—			(8	)		—						(8	)

Operating income ^(b)		—			585			41			—						626
Equity in income (loss) of affiliates and other items ^(c)		(146	)		41			22			84						1
Tax on net operating income		43			(198	)		(9	)		(2	)					(166	)

Net operating income ^(b)		(103	)		428			54			82						461
Net cost of net debt																	—
Minority interests																	(4	)

Net income																	457

(a) Adjustments include special items, inventory valuation effect and, until June 30,2010, equity share of adjustments related to Sanofi.
(b) Of which inventory valuation effect

On operating income		—			635			65			—
On net operating income		—			467			50			—

(c) Of which equity share of adjustments related to Sanofi		—			—			—			(81	)

1^st half 2010 (adjusted) (M€) ^(a)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Non-Group sales		9,115			60,998			8,812			7			—			78,932
Intersegment sales		11,019			2,475			507			87			(14,088	)		—
Excise taxes		—			(9,444	)		—			—			—			(9,444	)

Revenues from sales		20,134			54,029			9,319			94			(14,088	)		69,488
Operating expenses		(8,818	)		(52,666	)		(8,602	)		(318	)		14,088			(56,316	)
Depreciation, depletion and amortization of tangible assets and mineral interests		(2,548	)		(623	)		(258	)		(19	)		—			(3,448	)

Adjusted operating income		8,768			740			459			(243	)		—			9,724
Equity in income (loss) of affiliates and other items		444			114			101			348			—			1,007
Tax on net operating income		(5,038	)		(216	)		(129	)		144			—			(5,239	)

Adjusted net operating income		4,174			638			431			249			—			5,492
Net cost of net debt																	(107	)
Minority interests																	(128	)

Adjusted net income																	5,257

Adjusted fully-diluted earnings per share (€)																	2.34


(a) Except for per share amounts.

1^sthalf 2010 (M€)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Total expenditures		5,866			1,018			238			33						7,155
Total divestments		261			38			334			1,265						1,898
Cash flow from operating activities		8,834			1,496			387			(515	)					10,202


2^ndquarter 2011 (M€)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Non-Group sales		5,166			34,551			5,291			1			—			45,009
Intersegment sales		6,341			1,535			345			43			(8,264	)		—
Excise taxes		—			(4,544	)		—			—			—			(4,544	)

Revenues from sales		11,507			31,542			5,636			44			(8,264	)		40,465
Operating expenses		(5,072	)		(31,149	)		(5,251	)		(161	)		8,264			(33,369	)
Depreciation, depletion and amortization of tangible assets and mineral interests		(1,100	)		(300	)		(122	)		(9	)		—			(1,531	)

Operating income		5,335			93			263			(126	)		—			5,565
Equity in income (loss) of affiliates and other items		473			37			18			255			—			783
Tax on net operating income		(3,275	)		(20	)		(117	)		(53	)		—			(3,465	)

Net operating income		2,533			110			164			76			—			2,883
Net cost of net debt																	(71	)
Minority interests																	(86	)

Net income																	2,726

2^ndquarter 2011 (adjustments) ^(a) (M€)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Non-Group sales		(55	)		—			—			—						(55	)
Intersegment sales
Excise taxes

Revenues from sales		(55	)		—			—			—						(55	)
Operating expenses		—			(135	)		(15	)		—						(150	)
Depreciation, depletion and amortization of tangible assets and mineral interests		—			—			—			—						—

Operating income ^(b)		(55	)		(135	)		(15	)		—						(205	)
Equity in income (loss) of affiliates and other items		121			(2	)		(37	)		43						125
Tax on net operating income		10			50			(31	)		(2	)					27

Net operating income ^(b)		76			(87	)		(83	)		41						(53	)
Net cost of net debt																	—
Minority interests																	(15	)

Net income																	(68	)

(a) Adjustments include special items, inventory valuation effect and, as from January 1st , 2011, the effect of changes in fair value.
(b) Of which inventory valuation effect

On operating income		—			(72	)		(15	)		—
On net operating income		—			(42	)		(17	)		—

2^ndquarter 2011 (adjusted) (M€) ^(a)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Non-Group sales		5,221			34,551			5,291			1			—			45,064
Intersegment sales		6,341			1,535			345			43			(8,264	)		—
Excise taxes		—			(4,544	)		—			—			—			(4,544	)

Revenues from sales		11,562			31,542			5,636			44			(8,264	)		40,520
Operating expenses		(5,072	)		(31,014	)		(5,236	)		(161	)		8,264			(33,219	)
Depreciation, depletion and amortization of tangible assets and mineral interests		(1,100	)		(300	)		(122	)		(9	)		—			(1,531	)

Adjusted operating income		5,390			228			278			(126	)		—			5,770
Equity in income (loss) of affiliates and other items		352			39			55			212			—			658
Tax on net operating income		(3,285	)		(70	)		(86	)		(51	)		—			(3,492	)

Adjusted net operating income		2,457			197			247			35			—			2,936
Net cost of net debt																	(71	)
Minority interests																	(71	)

Adjusted net income																	2,794

Adjusted fully-diluted earnings per share (€)																	1.24


(a) Except for per share amounts.

2^ndquarter 2011 (M€)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Total expenditures		6,868			462			209			31						7,570
Total divestments		921			28			12			377						1,338
Cash flow from operating activities		5,605			7			138			(686	)					5,064


2^ndquarter 2010 (M€)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Non-Group sales		4,546			32,190			4,589			4			—			41,329
Intersegment sales		5,717			1,394			270			45			(7,426	)		—
Excise taxes		—			(5,002	)		—			—			—			(5,002	)

Revenues from sales		10,263			28,582			4,859			49			(7,426	)		36,327
Operating expenses		(4,364	)		(27,460	)		(4,483	)		(173	)		7,426			(29,054	)
Depreciation, depletion and amortization of tangible assets and mineral interests		(1,292	)		(318	)		(136	)		(11	)		—			(1,757	)

Operating income		4,607			804			240			(135	)		—			5,516
Equity in income (loss) of affiliates and other items		190			124			78			168			—			560
Tax on net operating income		(2,621	)		(250	)		(65	)		85			—			(2,851	)

Net operating income		2,176			678			253			118			—			3,225
Net cost of net debt																	(57	)
Minority interests																	(67	)

Net income																	3,101

2^ndquarter 2010 (adjustments) ^(a) (M€)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Non-Group sales
Intersegment sales
Excise taxes

Revenues from sales
Operating expenses		—			255			(57	)		—						198
Depreciation, depletion and amortization of tangible assets and mineral interests		—			—			(8	)		—						(8	)

Operating income ^(b)		—			255			(65	)		—						190
Equity in income (loss) of affiliates and other items ^(c)		(40	)		25			18			(7	)					(4	)
Tax on net operating income		13			(85	)		26			—						(46	)

Net operating income ^(b)		(27	)		195			(21	)		(7	)					140
Net cost of net debt																	—
Minority interests																	—

Net income																	140
(a) Adjustments include special items, inventory valuation effect and, until June 30, 2010, equity share of adjustments related to Sanofi. (b) Of which inventory valuation effect
On operating income		—			255			(41	)		—
On net operating income		—			195			(25	)		—

(c) Of which equity share of adjustments related to Sanofi		—			—			—			(40	)

2^ndquarter 2010 (adjusted) (M€) ^(a)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Non-Group sales		4,546			32,190			4,589			4			—			41,329
Intersegment sales		5,717			1,394			270			45			(7,426	)		—
Excise taxes		—			(5,002	)		—			—			—			(5,002	)

Revenues from sales		10,263			28,582			4,859			49			(7,426	)		36,327
Operating expenses		(4,364	)		(27,715	)		(4,426	)		(173	)		7,426			(29,252	)
Depreciation, depletion and amortization of tangible assets and mineral interests		(1,292	)		(318	)		(128	)		(11	)		—			(1,749	)

Adjusted operating income		4,607			549			305			(135	)		—			5,326
Equity in income (loss) of affiliates and other items		230			99			60			175			—			564
Tax on net operating income		(2,634	)		(165	)		(91	)		85			—			(2,805	)

Adjusted net operating income		2,203			483			274			125			—			3,085
Net cost of net debt																	(57	)
Minority interests																	(67	)

Adjusted net income																	2,961

Adjusted fully-diluted earnings per share (€)																	1.32

(a) Except for per share amounts.

2^ndquarter 2010 (M€)	Upstream			Downstream			Chemicals			Corporate			Intercompany			Total
Total expenditures		2,723			562			144			17						3,446
Total divestments		174			11			328			337						850
Cash flow from operating activities		4,154			1,042			477			(731	)					4,942

9) Impact of adjustments on the consolidated statement of income


1^sthalf 2011 (M€)	Adjusted			Adjustments			Consolidated statement of income

Sales		91,009			29			91,038
Excise taxes		(8,971	)		—			(8,971	)
Revenues from sales		82,038			29			82,067

Purchases net of inventory variation		(56,910	)		1,269			(55,641	)
Other operating expenses		(9,443	)		(63	)		(9,506	)
Exploration costs		(438	)		—			(438	)
Depreciation, depletion and amortization of tangible assets and mineral interests		(3,217	)		—			(3,217	)
Other income		109			222			331
Other expense		(129	)		(68	)		(197	)

Financial interest on debt		(295	)		—			(295	)
Financial income from marketable securities & cash equivalents		102			—			102
Cost of net debt		(193	)		—			(193	)

Other financial income		410			—			410
Other financial expense		(212	)		—			(212	)

Equity in income (loss) of affiliates		929			21			950

Income taxes		(6,880	)		(624	)		(7,504	)

Consolidated net income		6,064			786			6,850
Group share		5,898			774			6,672
Minority interests		166			12			178

1^sthalf 2010 (M€)	Adjusted			Adjustments			Consolidated statement of income

Sales		78,932			—			78,932
Excise taxes		(9,444	)		—			(9,444	)
Revenues from sales		69,488			—			69,488

Purchases net of inventory variation		(46,330	)		700			(45,630	)
Other operating expenses		(9,479	)		(66	)		(9,545	)
Exploration costs		(507	)		—			(507	)
Depreciation, depletion and amortization of tangible assets and mineral interests		(3,448	)		(8	)		(3,456	)
Other income		80			194			274
Other expense		(167	)		(159	)		(326	)

Financial interest on debt		(213	)		—			(213	)
Financial income from marketable securities & cash equivalents		48			—			48
Cost of net debt		(165	)		—			(165	)

Other financial income		213			—			213
Other financial expense		(190	)		—			(190	)

Equity in income (loss) of affiliates		1,071			(34	)		1,037

Income taxes		(5,181	)		(166	)		(5,347	)

Consolidated net income		5,385			461			5,846
Group share		5,257			457			5,714
Minority interests		128			4			132


2^ndquarter 2011 (M€)	Adjusted			Adjustments			Consolidated statement of income

Sales		45,064			(55	)		45,009
Excise taxes		(4,544	)		—			(4,544	)
Revenues from sales		40,520			(55	)		40,465

Purchases net of inventory variation		(28,299	)		(87	)		(28,386	)
Other operating expenses		(4,741	)		(63	)		(4,804	)
Exploration costs		(179	)		—			(179	)
Depreciation, depletion and amortization of tangible assets and mineral interests		(1,531	)		—			(1,531	)
Other income		35			211			246
Other expense		(70	)		(68	)		(138	)

Financial interest on debt		(159	)		—			(159	)
Financial income from marketable securities & cash equivalents		55			—			55
Cost of net debt		(104	)		—			(104	)

Other financial income		335			—			335
Other financial expense		(104	)		—			(104	)

Equity in income (loss) of affiliates		462			(18	)		444

Income taxes		(3,459	)		27			(3,432	)

Consolidated net income		2,865			(53	)		2,812
Group share		2,794			(68	)		2,726
Minority interests		71			15			86

2^ndquarter 2010 (M€)	Adjusted			Adjustments			Consolidated statement of income

Sales		41,329			—			41,329
Excise taxes		(5,002	)		—			(5,002	)
Revenues from sales		36,327			—			36,327

Purchases net of inventory variation		(24,143	)		214			(23,929	)
Other operating expenses		(4,817	)		(16	)		(4,833	)
Exploration costs		(292	)		—			(292	)
Depreciation, depletion and amortization of tangible assets and mineral interests		(1,749	)		(8	)		(1,757	)
Other income		52			62			114
Other expense		(61	)		(53	)		(114	)

Financial interest on debt		(113	)		—			(113	)
Financial income from marketable securities & cash equivalents		24			—			24
Cost of net debt		(89	)		—			(89	)

Other financial income		142			—			142
Other financial expense		(95	)		—			(95	)

Equity in income (loss) of affiliates		526			(13	)		513

Income taxes		(2,773	)		(46	)		(2,819	)

Consolidated net income		3,028			140			3,168
Group share		2,961			140			3,101
Minority interests		67			—			67

10) Changes in progress in the Group structure

Upstream

•

TOTAL signed in March 2011 agreements for the acquisition in Uganda of a one-third interest in Blocks 1, 2 and 3A held by Tullow Oil plc for $1,467 million (amount as of January 1, 2010, to which will add costs of interim period). Following this acquisition, TOTAL becomes an equal partner with Tullow and CNOOC in the blocks, each with a one-third interest and each being an operator of one of the blocks. Subject to the decision of the Authorities, TOTAL will be the operator of Block 1.

•

TOTAL announced in June 2011 the signing of an agreement with Silex Gas Norway AS, a wholly owned subsidiary of Allianz, to sell its entire stake in Gassled (6.4%) and related entities for a price of NOK 4.64 billion (approximately $870 million). The transaction is subject to approval by the relevant authorities.

As of June 30, 2011, the assets and liabilities included in the transaction have been classified respectively as “Assets classified as held for sale” on the face of the consolidated balance sheet for €510 million and as “Liabilities directly associated with the assets classified as held for sale” on the face of the consolidated balance sheet for €324 million.

•

TOTAL announced in July 2011 the acquisition of Esso Italiana’s interests respectively in the Gorgoglione concession (25% interest), which contains the Tempa Rossa field, and in two exploration licenses located in the same area (51.7% for each one). The acquisition increases TOTAL’s interest in the operated Tempa Rossa field to 75%, Shell holding the remaining 25%. The transfer of interests is subject to the approval of Italian authorities.

Downstream

•

TOTAL and International Petroleum Investment Company (a company wholly-owned by the Government of Abu Dhabi) have entered into an agreement on February 15, 2011 for the sale, to International Petroleum Investment Company (IPIC), of the 48.83% equity interest held by TOTAL in the share capital of CEPSA, to be completed within the framework of a public tender offer being launched by IPIC for all the CEPSA shares not yet held by IPIC, at a unit purchase price of €28 per CEPSA share. This public tender offer was approved by the Comisión Nacional del Mercado de Valores (CNMV) on July 6, 2011. The acceptance period of the offer, during which the shareholders of CEPSA may decide to tender their CEPSA shares to IPIC, started on July 8, 2011 and terminated on July 22, 2011. In accordance with the agreement of February 15, 2011, TOTAL already tendered to IPIC on July 11 and 12, 2011 all of its equity interest in CEPSA, i.e. 130,668,240 CEPSA shares. Upon final completion of the transaction (settlement of the offer), TOTAL will receive an amount of approximately €3,659 million.

As of June 30, 2011, CEPSA’s equity value is presented as “Assets classified as held for sale” on the face of the consolidated balance sheet for €2,885 million.

•

In the United Kingdom, TOTAL announced that it offered for sale its Marketing business, except for certain specialties, and the Lindsey refinery.

In June 2011, a sale and purchase agreement has been signed to sell most of its Marketing assets in the United Kingdom, the Channel Islands and the Isle of Man to Rontec Investments LLP, a consortium led by Snax 24, one of the leading independent forecourt operators in the UK. This transaction is expected to be completed later in 2011.

The sale process for TOTAL’s refining assets in the UK is ongoing.

As of June 30, 2011, assets and liabilities of the Marketing businesses included in the transaction and of the Refining business have been classified respectively as “Assets classified as held for sale” on the face of the consolidated balance sheet for €1,293 million and as “Liabilities directly associated with the assets classified as held for sale” on the face of the consolidated balance sheet for €3 million.

Chemicals

•

TOTAL announced in December 2010 a plan to sell its photocure and coatings resins businesses to Arkema for a €550 million enterprise value. This sale has been effective on July 1, 2011.

As of June 30, 2011, assets and liabilities of the photocure and coatings resins businesses have been classified respectively as “Assets classified as held for sale” on the face of the consolidated balance sheet for €523 million and as “Liabilities directly associated with the assets classified as held for sale” on the face of the consolidated balance sheet for €68 million. The assets mainly include a goodwill for €80 million, tangible assets for €196 million and inventories for €160 million.

11) Post-closing events

Since 1966, the Group has been taxed in accordance with the consolidated income tax treatment approved on a three-year renewable basis by the French Ministry of Economy, Finance and Industry. The approval for the period 2008-2010 expired on December 31, 2010. In July 2011, TOTAL S.A. decided not to ask for the renewal of this agreement. As a consequence, TOTAL S.A. is taxed in accordance with the common tax regime as from 2011. This change will be accounted for during the third quarter of 2011 and is not expected to have any significant accounting impacts on the consolidated balance sheet, statement of income and shareholders’ equity of the Group.