Interim Results

Total Fina Elf.
4 September 2002


TotalFinaElf Reports Second Quarter 
and First Half 2002 Results
 
Second Quarter 2002, excluding non-recurring items

• Net income: 1.63 billion euros, down 23%
• Earnings per share: 2.42 euros, down 20%

  11% increase in hydrocarbon production


First Half 2002, excluding non-recurring items

• Net income: 3.05 billion euros, down 30%
• Earnings per share: 4.54 euros, down 26%

  9% increase in hydrocarbon production
 

Paris - September 4, 2002 - The Board of Directors of TotalFinaElf, chaired by 
CEO Thierry Desmarest met on September 3, 2002 to review the consolidated 
accounts for the Group's second quarter and first half 2002.

Commenting on the results, Thierry Desmarest said :

'TotalFinaElf performed well given the downturn in the oil market environment. 
When we express our results in dollars in order to be comparable to our peers, 
the decrease in the second quarter 2002 earnings per share excluding 
non-recurring items was limited to 16% for TotalFinaElf versus a decrease in 
results announced by the other majors of 38% on average (...)

This performance highlights the importance of our self-help programs. In the 
second quarter 2002, TotalFinaElf increased oil and gas production by 11% 
despite the negative impact of OPEC quota reductions (...)

For the first half 2002, the decrease in earnings per share excluding 
non-recurring items, expressed in dollars, was 26% compared to an average 
decrease of 47% for the other majors.'


Consolidated accounts TotalFinaElf

2Q02      2Q01   %   millions of euros                       1H02     1H01    %

26,435  28,361  -7%  Sales                                  50,219  55,683  -10%

2,845   3,779  -25%  Operating income from business         5,277   7,527   -30%
                     segments (excluding non-recurring items)  

1,526   2,128  -28%  Net operating income from business     2,882   4,427   -35%
                     segments (excluding non-recurring items)
     
1,632   2,127  -23%  Net income (Group share)               3,051   4,333   -30%
                     excluding non-recurring items     

1,503   2,501  -40%  Net income (Group share)               2,932   4,707   -38%

 2.42    3.04  -20%  Earnings per share (euros)              4.54    6.16   -26%
                     excluding non-recurring items     

2,100   2,387  -12%  Investments                            4,209   4,820   -13%

  463   1,948  -76%  Divestments at selling price           1,049   3,115   -66%

2,850   2,512  +13%  Cash flow from operating activities    5,308   7,084   -25%


Non-recurring Items

2Q02      2Q01             millions of euros             1H02      1H01

                   Impact of non-recurring items on operating income

(16)        -         Restructuring charges             (16)        -
(21)        -         Impairments                       (21)        -
 (9)        -         Other                              (9)        -
(46)        -         Total                             (46)        -

                   Impact of non-recurring items on net income


 134      374        Gain on asset sales               277       374
 (47)        -        Toulouse plant Impact            (149)        -

                      Restructuring charges and
 (45)        -        early retirement plans            (76)        -

 (14)        -        Impairments                       (14)        -

(157)*       -        Other                             (157)*      -

(129)      374        Total                             (119)     374

* Includes 151 M€ related to UK tax changes

Number of shares

2Q02    2Q01      %       millions                        1H02      1H01    %

                          Fully-diluted weighted-
673.0   700.1    -4%      average shares                  671.1     703.2  -4%
 
Oil market environment
 
2Q02    2Q01      %                                        1H02      1H01   %

0.92    0.87     -5%*     €/$                              0.90      0.90   -

25.0    27.3     -8%      Brent ($/b)                      23.1      26.6  -13%

4.9     18.7     -74%     European refining                 3.6      16.9  -79%
                          margin TRCV ($/t)     

* change in the dollar versus the euro


Second Quarter 2002 Results

All of the oil market parameters were weaker in the second quarter 2002 than in 
the second quarter 2001. The average Brent oil price fell by 8% to $25.0/b from 
$27.3/b. The European refining margin fell sharply to $4.9/t in the second 
quarter 2002 from $l8.7/t in the second quarter 2001. The dollar depreciated by 
5% relative to the euro, with the exchange rate averaging $0.92 per euro in the 
second quarter 2002 versus $0.87 per euro in the second quarter 2001.

Within this context, operating income from the business segments, excluding 
non-recurring items, fell by 25% to 2,845 million euros in the second quarter 
2002 from 3,779 million euros in the second quarter 2001. Non-recurring items 
in the second quarter 2002 had an impact on operating income of .46 million 
euros, primarily comprised of Upstream write-downs (under FAS 144, which has 
superceded FAS 121 for impairments of fixed assets) and Downstream restructuring 
charges, following the consolidation of certain French refining and marketing 
subsidiaries.

Net operating income from the business segments excluding non-recurring items 
declined by 28% to 1,526 million euros in the second quarter 2002 from 2,128 
million euros in the second quarter 2001.

Net income excluding non-recurring items fell by 23% to 1,632 million euros in 
the second quarter 2002 from 2,127 million euros in the same period last year.

Earnings per share excluding non-recurring items, based on 673.0 million 
fully-diluted weighted-average shares in the second quarter 2002, fell by only 
20% to 2.42 euros from 3.04 euros per share in the second quarter 2001. The 
limited decline reflects the positive impact of the Group's share buy-backs.


During the second quarter 2002, TotalFinaElf bought back 2.39 million of its 
shares(1) for 0.38 billion euros. During the same period, the company 
implemented a 2.8 million share employee stock plan. At June 30, 2002, the 
number of fully-diluted shares was 673.6 million.

Reported net income declined to 1,503 million euros in the second quarter 2002 
from 2,501 million euros in the same period of 2001. Non-recurring items had a 
negative impact of 129 million euros on second quarter 2002 versus a positive 
impact of 374 million euros on second quarter 2001 net income. Non-recurring 
items in the second quarter 2002 included gains on sales of financial 
participations, a charge related to recent changes in the UK tax regime for 
exploration and production activities, charges for Downstream and Chemicals 
restructuring, and an additional provision related to the Toulouse plant 
explosion.

The impact of the crisis in Argentina was not reflected in a special charge 
during the first half of 2002. Ongoing negotiations concerning domestic prices 
for gas and power deliveries do not provide, at this stage, a basis to estimate 
with sufficient precision the possible impact on the value of the affected 
assets. TotalFlnaElf's operations in Argentina are limited relative to the scale 
of the Group.

First Half 2002 Results

The average euro-dollar exchange rate was stable at $0.90 per euro for both the 
first half 2002 and first half 2001. The average Brent oil price fell by 13% to 
$23.1/b in the first half 2002 from $26.6/b in the first half 2001. The European 
refining margin fell sharply to $3.6/t in the first half 2002 from $16.9/t in 
the first half 2001.

Operating income excluding non-recurring items declined by 30% to 5,277 million 
euros in the first half 2002 from 7,527 million euros in the first half 2001. 
This 2.2 billion euro decrease was due primarily to the 2.9 billion euro 
negative impact from changes in the oil market environment, partially offset by 
0.7 billion euros of self-help benefits, composed of 0.5 billion euros from 
production growth and 0.2 billion euros from synergies and productivity gains.

The overall negative impact of changes in the oil market environment included:

•   - 1.3 billion euros due to lower hydrocarbon prices (including 0.2 billion 
    euros for the negative gas price lag), 
•   - 1.0 billion euros due to lower refining margins, 
•   - 0.3 billion euros due to the deterioration of the Chemicals environment,   
•   - 0.3 billion euros for other elements(2).

Net operating income from the business segments excluding non-recurring items 
fell by 35% to 2,882 million euros in the first half 2002 from 4,427 million 
euros in the first half 2001. The percentage decrease in net operating income 
was larger than the decrease in pre-tax operating income because Upstream, which 
has a higher tax rate than Downstream or Chemicals, has increased its 
proportionate share of operating income.

Net income excluding non-recurring items fell by 30% to 3,051 million euros in 
the first half 2002 from 4,333 million euros in the first half 2001. The 
percentage decline in net income was less than the decline in net operating 
income largely because of the lower net interest expense.

Earnings per share excluding non-recurring items, based on 671.7 million 
fully-diluted weighted-average shares for the first half 2002, decreased to 4.54 
euros from 6.16 euros in the first half 2001, a limited decline of 26% that 
reflects the positive impact of the Group's buy-back program.
 
(1) includes 2.04 million shares used to cover stock option program
(2) marketing (-0.1 B€) and other Downstream (-0.1 B€)

During the first half 2002, TotalFinaElf bought back 4.99 million of its
shares(3) for 0.78 billion euros. During the same period, the company
implemented a 2.8 million share employee stock plan.

Reported net income was 2,932 million euros in the first half 2002 compared to
4,707 million euros in the first half of 2001. Non-recurring items had a
negative impact of 119 million euros on the first half 2002.

The return on capital employed from the business segments calculated for the
twelve months ended June 30, 2002 was 14% compared to 22% for the twelve months
ended June 30, 2001.

The return on equity calculated for the twelve months ended June 30, 2002 was 
19%.

The net-debt-to-equity ratio at June 30, 2001 was 28.2% compared to 29.5% at 
March 31,2002.

 
Upstream(4)

Upstream operating income excluding non-recurring items fell by 16% to 4,341
million euros in the first half 2002 from 5,158 million euros in the first half
2001. Strong production growth partially offset the impact of lower hydrocarbon
prices.

Net operating income excluding non-recurring items from the Upstream segment fell
by 17% to 2,267 million euros in the first half 2002.

Hydrocarbon production rose by 9.1% to 2,394 thousand barrels of oil equivalent
per day (kboe/d) in the first half 2002 from 2,194 kboe/d in the first half
2001.

Production growth was primarily due to a number of start-ups, including Elgin-
Franklin, Nuggets, and Huldra in the North Sea, Girassol in Angola, the Sincor
upgrader in Venezuela, South Pars in Iran, and Deir Ez Zor gas in Syria.

In Europe, highlights of the first half 2002 included a significant gas and
condensate discovery made on Block 3/15 (the greater Alwyn area) in the UK North
Sea, first production from the K1A gas field in the Dutch North Sea, and a
rearrangement of interests in the fields within the Oseberg zone in the
Norwegian North Sea that allowed the company to have a 10% interest in all of
the Oseberg zone fields.

In the CIS, TotalFinaElf signed agreements with the Russian company Yukos to
explore the Shatsky zone in the Black Sea, the Anglo Siberian Oil Company for
the purchase of its interest in the Vankor field(5) in Siberia, and the BTC
partnership to acquire a 5% interest in the proposed pipeline that will link
Baku, Azerbaijan to Ceyhan, Turkey.

In the Middle East, the South Pars offshore gas and condensate field (Phases 2
and 3) in Iran began production in March, and the Dorood project started
production in May. In Syria, the Dezgas project, intended to commercialize the
gas production from the Deir Ez Zor region, reached full capacity. In Oman,
TotalFinaElf was awarded a 100% interest in the exploration Block 34. In Qatar,
development of the northern zone of the Al Khalij field was launched after the
Group increased its interest to 100%.

In Africa, the highlight has been the rapid increase in production from the
Girassol field on Block 17 offshore Angola. In Nigeria, a significant deep
offshore discovery was made on OPL 222, and the final investment decision was
approved for the 4th and 5th natural gas liquefaction trains at the Bonny LNG
plant.


(3)includes 2.04 million shares used to cover stock option program 

(4)the Upstream segment encompasses Exploration-production and Gas & Power

(5)pending final approval


In North America, TotalFinaElf was awarded 20 exploration blocks in Alaska's 
National Petroleum Reserve Area (NPRA).

In South America, first production of synthetic crude from the Sincor upgrader 
began in March 2002 and production is ramping up according to plan.
 

 2Q02     2Q01      %    Upstream - Key Figures              1H02    1H01     %

2,387    2,146   +11%    Hydrocarbon production (kboe/d)    2,394   2,194    +9%

1,576    1,424   +11%    •Liquids (kb/d)                    1,567   1,450    +8%
4,443    3,942   +13%    •Gas (Mcfd)                        4,524   4,067   +11%

2,325    2,585   -10%    Operating income (M€)              4,341   5,158   -16%
                         excluding non-recurring items

1,201    1,314    -9%    Net Operating income (M€)          2,267   2,736   -17%
                         excluding non-recurring items

1,556    1,509    +3%    Investments (M€)                   3,199   3,347    -4%

  106      228   -54%    Divestments (M€)                     329     380   -13%
                         at selling price

1,705    2,075   -18%    Cash flow from operating           3,397   4,190   -19%
                         activities (M€)


Downstream(6)

Downstream operating income excluding non-recurring items fell by 67% to 573
million euros in the first half 2002 from 1,760 million euros in the first half
2001.

The decrease in operating income was due largely to the sharp decline in
European and American refining margins and, to a lesser extent, to marketing
margins, specialty product sales and shipping. Ongoing synergy and productivity
gains served to partially offset the impact of the severe downturn in the market
environment.

Net operating income excluding non-recurring items declined by a similar
proportion, 66%, to 468 million euros in the first half 2002 from 1,365 million
euros in the first half 2001.

Taking into account the weak market conditions In the first half 2002 as well as
the refinery turn-arounds, throughput volume declined by 3% to 2.42 Mb/d In
first half 2002 versus the same period last year.

In July, TotalFinaElf signed an agreement with Agip and Galp that involved the
sale of the TOTAL-branded network In Spain and the acquisition of stations in
Portugal and Italy. As a result of these actions, TotalFinaElf will increase its
market share in Portugal from 2% to 6% and in Italy from 6% to 7%. In August,
the Group sold its service station network in Switzerland.

 
(6)the Downstream segment encompasses Refining-Marketing and Trading-Shipping


2Q02    2Q01      %       Downstream - Key Figures          1H02     1H01   %

2,435  2,478     -2%      Refinery throughput* (kb/d)     2,422     2,486   -3%

  278    904    -69%      Operating income (M€)             573     1,760  -67%
                          excluding non-recurring items          

  218    668    -67%      Net operating income (M€)         468     1,365  -66%
                          excluding non-recurring items     

  228    375    -39%      Investments (M€)                  360       504  -29%

   47     60    -22%      Divestments (M€) at                82       982  -92%
                          selling price     

                          Cash flow from operating 
  805    849     -5%      activities (M€)                 1,386     1,857  -25%

* Including share of Cepsa

Chemicals

Sales for the Chemicals segment decreased by 6% to 9,905 million euros in the 
first half 2002 from 10,488 million euros in the first half 2001.

Operating income fell by 40% to 363 million euros in the first half 2002 from 
609 million euros in the first half 2001. The deterioration in the Chemicals 
environment had a negative impact on the order of 0.3 billion euros. The 
decrease was driven primarily by the sharp fall in base chemical margins to 
historic lows. Self-help programs partially offset this impact.

The intermediates were affected by the economic slowdown, while the Specialties 
showed a slight increase in operating income in the first half 2002 as compared 
to the same period last year.

Net operating income excluding non-recurring items declined to 147 million euros
in the first half 2002, a 55% decrease from the same half last year.

A rebound in petrochemical margins has been observed in Europe since May 2002.

2Q02    2Q01      %       Downstream - Key Figures          1H02     1H01   %

5,157  5,205     -1%      Sales (M€)                       9,905   10,488   -6%

  242    290    -17%      Operating income (M€)              363      609  -40%
                          excluding non-recurring items 
    
  107    146    -27%      Net operating income (M€)          147      326  -55%
                          excluding non-recurring items     

  284    346    -18%      Investments (M€)                   540      746  -28%

    9     34    -74%      Divestments (M€)                    41      112  -63%
                          at selling price     

                          Cash flow from operating 
   48    313    -85%      activities (M€)                     38      680  -94%


Summary & Outlook

First half 2002 investments for the business segments were 4.10 billion euros,
with Upstream accounting for 78% of the total. Exploration-Production 
investments for 2002 are in line with objectives. Gas & Power investments are 
lower.

Divestments in the first half 2002, at selling price, were 1.05 billion euros, 
being comprised primarily of sales of financial participations.

Free cash flow (7) in the first half 2002 was 2.15 billion euros. 

The divestment objective for 2002 is confirmed at 2 billion euros.

From January to August 2002, TotalFinaElf bought back 10.06 million(8) of its 
own shares for 1.51 billion euros. The buy-back program for the full-year 2002 
targets 2.5% of the share capital.

In the third quarter 2002, the oil market environment remained mixed. Oil prices 
have been rising since the beginning of the year while the dollar has weakened 
against the euro. Refining margins are still at very low levels while 
petrochemical margins have rebounded recently.

Realization of growth and synergies/productivity programs progressed 
satisfactorily and in line with announced objectives. The first half 2002 
production level and the continued progress by the Upstream segment allow 
confirmation of the full-year objective to increase hydrocarbon production by 
10% in 2002 versus 2001.
  
The June 30, 2002 interim financial statements are available on the TotalFinaElf 
website. These financial statements have been the subject of a limited review by 
our auditors. This document may contain forward-looking statements within the 
meaning of the Private Securities Litigation Reform Act of 1995 with respect to
the financial condition, results of operations, business, strategy and plans of 
the TotalFinaElf Group. Such statements are based on a number of assumptions 
that could ultimately prove inaccurate, and are subject to a number of risk 
factors, including currency fluctuations, the price of petroleum products, the 
ability to realize cost reductions and operating efficiencies without unduly 
disrupting business operations, environmental regulatory considerations and 
general economic and business conditions. The financial information contained in
this document has been prepared in accordance with French GAAP, and certain 
elements would differ materially upon reconciliation to US GAAP. The 
TotalFinaElf Group does not assume any obligation to update publicly any 
forward-looking statement, whether as a result of new information, future events
or otherwise. Further information on factors which could affect the company's 
financial results is provided in documents filed by the Group and its affiliates
with the French Commission des Operations de Bourse and the US Securities and 
Exchange Commission.
 
To listen to the presentation by Thierry Desmarest to financial analysts today 
at 11:00 a.m. (Paris time), please visit www.totalfinaelf.com or 
dial + 44 (0)208 401 1043 from Europe and [phone] from the US (access 
code: TotalFinaElf). For a replay, visit the company website or 
dial 44 (0) 208 288 44 59 (access code: 107 212) from Europe and [phone] 
(access code: 107 212) from the US.


(7) free cash flow = cash flow from operating activities + divestments - 
    investments 

(8) Includes 2.91 million shares used to cover stock option program


Operating Information by Segment

Second Quarter and First Half 2002


Upstream

Combined liquids and gas production by region

 2Q02    2Q01       %          in kboe/d           1H02     1H01     %

  889     730    +22%           Europe              889      754   +18%   

  662     610     +9%           Africa              672      622   + 8%

   43      53    -19%           North America        42       50   +16%

  212     229     -7%           Far East            220      227    -3%

  389     372     +5%           Middle East         400      393    +2%

  187     147    +27%           South America       166      142   +17%
  
    5       5       -           Rest of world         5        6     0


2,387    2,146   +11%           Total production  2,394    2,194   +9% 


Liquids production by region

 2Q02    2Q01      %            in kb/d            1H02     1H01    %

  472     407    +16%           Europe              464      407  +14%
 
  594     547     +9%           Africa              600      556   +8%

    5       7      -            North America         5        7    -

   22      28    -21%           Far East             23       27  -15%

  350     338     +4%           Middle East         358      355   +1%  

  128      92    +39%           South America       112       92  +22%

    5       5      -            Rest of world         5        6    -

1,576   1,424    +11%           Total production  1,567    1,450   +8%



Gas production by region
 
 2Q02    2Q01      %            in Mcfd            1H02     1H01    %

2,266   1,745    +30%           Europe            2,315    1,871  +24%

  363     330    +10%           Africa              381      349   +9%

  203     232    -13%           North America       199      225  -12%

1,091   1,156     -6%           Far East          1,124    1,147   -2%

  202     181    +12%           Middle East         215      203   +6%

  318     298     +7%           South America       290      272   +7%

    -       -      -            Rest of world         -        -    -

4,443     3,942  +13%           Total production  4,524    4,067   +11%  


Downstream
                         
Refinery throughout by region 

 2Q02    2Q01      %            in kb/d            1H02     1H01    %
              
  931   1,027     -9%           France              921    1,030  -11%

1,203   1,174     +2%           Rest of Europe    1,202    1,172   +3%

  301     277     +9%           Rest of world       299      284   +5%

2,435   2,478     -2%           Total throughput* 2,422    2,486   -3%

* Includes share of Cepsa

Chemicals
Reminder: As of January 1, 2002, results of the Chlorochemicals activities have 
been moved from the Intermediates & Performance Polymers Sector to the 
Petrochemicals & Plastics Sector, which already includes the chlorovinyl chain. 
To reflect the broadening of this Sector's activity, the name has been changed 
to 'Base chemicals & polymers'. The data presented in the table below has been 
restated for the year 2001 to take into account this change.



2Q02     2Q01      %    Chemicals - key figures (B€)         1H02     1H01     %

5.16     5.21     -1%     Chemical Sales                     9.91    10.49   -6%  

2.00     1.97     +2%     • Base chemicals & polymers        3.79     4.13   -8%
1.04     1.10     -5%     • Intermediates & performance      2.01     2.26  -11%
                            polymers         
2.11     2.12      -      • Specialties                      4.08     4.08    -
0.01     0.02      -      • Corporate - Chemicals            0.03     0.02    -

0.24     0.29     -17%    Operating income*                  0.36     0.61  -41%
0        0.03       -     • Base chemicals & polymers       (0.07)    0.12    - 
0.09     0.12     -25%    • Intermediates & performance      0.18     0.23  -22%
                            polymers     
0.17     0.16     +6%     • Specialties                      0.30     0.29   +3%
(0.02)  (0.02)     -      • Corporate - Chemicals           (0.05)   (0.03)   -

*excluding non-recurring items

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