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Shell Reports First E&P Profit Since Pandemic

Shell Reports First E&P Profit Since Pandemic 

Royal Dutch Shell Plc said it expects to make its first profits since the start of the pandemic.


While revenues from natural gas, refining and chemicals helped Shell generate overall profits last year, its core business reported about permanent losses after the fall in energy prices due to Covid-19. The return to profitability in the exploration and production sector is another signal that the industry is recovering from a historic downturn.

Shares of Shell B rose 0.7% to 1,365.40 pence as of 12:02 pm in London. They are up 8.4% this year.

While the industry is recovering, it still has a long way to go before it fully recovers.

Although CEO Ben van Beurden said Shell was “On the right side” of the movement in the liquefied natural gas market in January – when prices rose to record highs – trading and optimization results in the first quarter in its integrated gas division will be “well below average.”

Shell said working capital will increase as a result of rising commodity prices, which will affect cash flows in its integrated gas, exploration and chemical divisions. In the fourth quarter, a large Anglo-Dutch company was unable to cover expenses and its dividends from free cash flow, even as oil prices continued to recover from historic lows.

In addition, severe winter storms in Texas, which caused damage to the state's infrastructure and halted a number of oil and gas fields will have a negative impact on adjusted earnings of about $ 200 million.

Shell also released its annual sustainability report on Wednesday. He confirmed that carbon emissions fell last year as a result of a slowdown in demand and asset sales caused by the pandemic. The company has pledged to cut greenhouse gas emissions over the next three decades and has tied pay more than 16,500 employees to reduce the carbon intensity of its products by 6-8% by 2023.

Shell losses in 2020

Recall that earlier Shell reported about huge losses in the second quarter of 2020. Royal Dutch Shell reported a staggering $ 18 billion quarterly loss, exacerbated by a $ 16.8 billion write-off on a range of assets. Huge losses came after a $ 3 billion profit in the second quarter of 2019 and $ 2.7 billion in the first quarter of 2020.

Post Shell reports first exploration and production profit since the start of the pandemic appeared first on TEKNOBLOG .

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