Shell seeks $ 7 billion buyback “at a pace” despite LNG issues


London — Royal Dutch Shell faces $ 7 billion in fueled from the sale of its US shale business, as it faces sluggish fuel sales due to the cessation of liquefied natural gas (LNG) and the economic blow of Omicron. He said he would pursue stock repurchase “at a pace.”

Shares in Shell, the world’s largest trader of LNG, fell 0.32 percent on Friday after trading was renewed prior to the quarterly closing on February 3. This is compared to a 0.12 percent increase in the broader European energy index.

Shell said its production and liquefaction were primarily affected by unplanned maintenance in Australia. In Australia, a huge prelude floating LNG carrier was hit by a power outage.

According to Shell, LNG liquefaction is between 7.7 million tonnes and 8.3 million tonnes, well below the peak of 9.2 million tonnes in the fourth quarter of 2019.

However, Shell’s LNG trading results for the fourth quarter of 2021 are set to be “significantly higher” compared to the third quarter.

As the economy recovered from the COVID-19 pandemic since mid-last year, tight gas supply and rising demand have led to soaring prices for natural gas and electricity around the world.

Benchmark European gas prices and Asian LNG prices hit record highs in the fourth quarter.

Shell will relocate its headquarters from The Hague to London later this month, simplifying its structure and abolishing the dual-share structure and renaming it to ShellPlc as part of a plan to relocate its place of residence from the Netherlands.

Last year, Shell sold its Permian Basin shale oil assets to ConocoPhillips for $ 9.5 billion in cash. This is a withdrawal from the largest oil field in the United States as it shifts its focus to a clean energy transition. In addition to 20% to 30% of cash flow from the business, it will return $ 7 billion in revenue to shareholders.

“The remaining $ 5.5 billion in revenue from the Permian sale will be distributed in the form of share buybacks at a pace,” he said.

Shell, which operates more than 45,000 gas stations, said revenue from the marketing department was set lower than “the impact of demand from the effects of the Omicron virus and foreign exchange in Turkey.”

Ron Busso

Reuters

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