PARIS—French oil company Total’s net profit fell 58 per cent in the first quarter after it took a heavy loss to pull out of a Canadian project it said was no longer worth the investment.
Total said its net profit fell to $2-billion in the three months to the end of March, from $4.8-billion last year.
Much of that drop was due to a $1.6-billion loss the company booked when it sold its stake in the Voyageur upgrader project, which would turn heavy crude into light oil.
A flood of light oil from the United States has made that no longer viable.
The company said the pullout would save $7.8-billion in investment over the next five years that it can now put toward more promising ventures.
The loss wasn’t the only thing weighing on profits, however.
Falling oil prices, maintenance at refineries and flagging demand amid Europe’s economic crisis also held Total back.
Adjusted net income—which excludes one-off charges and profits or losses on the value of held assets—fell seven per cent to $3.8-billion.
France’s largest company by market capitalization said revenue was also down, falling six per cent in the quarter to $62.6-billion.
That’s still higher than consensus expectations of $59-billion.