In 1924 the Compagnie Francaise des Petroleswas established by the French government to dvelop a French oil industry. The country had no major reserves of its own but had a stake in the Turkish Petroleum Company and when TPC struck oil in Iraq in 1927 the company agreed to give the French government a 25% share in the company in exchange for its independence. The French government raised its stake to 34% in the early 1930s. After World War II CFP diversified, forming joint ventures with Venezuela in the late 1940s and in Algeria in the 1950s. In 1954 the company introduced the Total brand name.
In the 1960s the company diversified into petrochemicals and invested heavily in exploration with large strikes being made in Indonesia and in the North Sea. There were further oil finds in the 1990s in Argentina, Colombia and in the former Soviet Union. The company continued to expand in petrochemicals and built up a retail network of over 10,000 service stations.
In 1985 the company changed its name to Total Compagnie Francaise des Petroles and in 1991 it became known as only as Total. The following year the French government sold all but 5% of its share in the company.
In 1995 the company's head of exploration Thierry Demarest was appointed chairman and in 1998 he led a bid to buy the Belgian petroleum group Petrofina. A few months later Demarest launched a $42bn takeover bid for rival Elf. After an acrimonious three-month battle Totalfina was successful and Demarest took charge of the new company.
Elf traces its roots back to Second World War when the Vichy Government established the Societe Nationale des Petroles d'Aquitaine (SNPA) with the intention of looking for oil within France's borders, having been deprived of access to CFP's reserves because of the fighting.
After the liberation General Charles de Gaulle established the Bureau de Recherches de Petrole (BRP) and merged SNPA with the Regie Autonome des Petroles (RAP) which had been established just before the war to exploit the discovery of natural gas in the south-west of France. The new company struck oil at Lacq in the Pyrenees in 1951 and its subsidiaries also discovered oil and gas in Gabon and Algeria in 1956 and in the Congo in 1957.
In 1967 the government decided to adopt a brandname for SNPA products. Company legend holds that the name was generated by a computer as Elf has no meaning in French. The company expanded into the United States and diversified into petrochemicals, establishing the Aquitaine Total Organico company in 1969.
There was a major setback in 1971 when Algeria nationalized its oil fields but Elf struck gas in the North Sea shortly afterwards and diversified into pharmaceuticals and cosmetics in 1973 after the oil crisis with the Saofi company. In 1983 the company's chemical industry was consolidated under Elf management in the company Atochem. Elf became highly acquisitive in the late 1980s with a variety of purchases, including Occidental's holdings in the North Sea. This was followed by a joint venture in 1992 with Germany's Thyssen to modernise Minol - the dominant service station chain in the country. The acquisitions continued in 1993 with the purchase of fashion house Yves Saint Laurent.
Recession in Europe reduced profits and the French government began to consider privatisation.
From its very beginnings Elf has used motor racing as a means of promotion. It began with a four-year association with Matra which began with a French Formula 3 programme which resulted in Henri Pescarolo winning the title. The European Formula 2 Championship fell to Matra the following year with Jean-Pierre Beltoise. And in 1969 the combination won the Formula 1 World Championship with Tyrrell and Jackie Stewart. The aim to win the Le Mans 24 Hours was not achieved until 1972 by which time Elf and Matra had gone their separate ways. Elf decided to undertake a policy to rebuild French motor racing and so began a new long-term relationship with Renault.
Throughout the 1970s and 1980s Elf was a major player in motorsport, sponsoring cars at all levels of the sport and promoting many of France's rising stars, notably Alain Prost. The company withdrew from all F1 sponsorship at the end of 1996, as part of the restructuring of the company prior to flotation.