Comprehensive Energy Data Intelligence
Information About Energy Companies, Their Assets, Market Deals, Industry Documents and More...
Shell Rises Earnings to $7.3 Billion in Latest Quarter, LNG Sales Up
03/04/2024
- Shell was the first of the global energy giants to report its full-year results for 2023.
- Recently, Shell has started reducing staff across the company, including in its low-carbon solutions division.
- Shell's total capital spending was US$24.4 billion in 2023, and it's expected to be between US$22 billion and US$25 billion this year.
Shell PLC revealed it made a profit of US$28 billion for 2023, thanks to strong earnings from trading liquefied natural gas (LNG). The company saw its quarterly adjusted earnings rise to $7.3 billion in the fourth quarter, up from $6.2 billion in the third quarter of 2023. This financial success allowed the company to raise its dividend and continue buying back shares.
The profit for the year was 30% less than the previous year's record high. This drop was due to smaller profits in chemicals and refining and slower fuel sales in a weak global economy. This follows a year of high profits in 2022, boosted by rising energy prices after Russia's invasion of Ukraine.
Shell raised its fourth-quarter dividend by 4% and announced it would buy back another US$3.5 billion in shares over the next three months, maintaining the rate of the last quarter.
In 2023, Shell gave back about US$23 billion to its shareholders, which is over 10% of its market value. This reflects the focus on returns among investors as the energy sector faces an uncertain future for fossil fuels.
Its stock ended 2.4% higher, outperforming its rivals with an over 8% increase over the past year.
Wael Sawan became the CEO in January 2023, promising to shift Shell's focus towards higher-margin projects, maintaining steady oil production, and boosting natural gas output.
“As we enter 2024 we are continuing to simplify our organization with a focus on delivering more value with less emissions,” Sawan said.
There's a noticeable shift in priorities, with spending in the renewables and energy solutions division dropping by 23% from the previous year to US$2.7 billion. This accounted for 11% of Shell's total capital expenditure in 2023, down from 14% in 2022.
LNG Sales Up
Shell's total production of oil and gas in 2023 was up by 2% to 939,000 barrels of oil equivalent per day. This increase came from starting up new fields in locations like Oman, Canada, Australia, and Trinidad and Tobago, along with less maintenance work in Qatar and Trinidad and Tobago.
The production increase was slightly offset by not including Sakhalin-related volumes and the effect of production sharing contract changes in Egypt and Qatar.
In the October to December period, Shell's LNG sales went up by 7.5% to 18.09 million tonnes, compared to 16.82 million tonnes during the same timeframe last year. This growth is also higher than the sales from the previous quarter, which were 16.01 million tonnes, marking a 13% increase.
Throughout 2023, Shell managed to sell 67.09 million tonnes of LNG, showing a 2% increase from the 65.98 million tonnes sold in 2022.
The company's production of LNG in the fourth quarter saw a 4.1% year-on-year rise to 7.06 million tonnes and a 3% increase from the 6.88 million tonnes produced in the quarter before. However, the total production for the year dropped by 5% to 28.29 million tonnes, mainly due to cutting out Sakhalin-related volumes.
“Shell’s LNG division continues to help support cash generation and the company also appears to have operational momentum.”
- RBC Capital Markets analyst Biraj Borkhataria
Looking ahead to the first quarter of 2024, Shell is aiming for liquefaction volumes between 7.0 and 7.6 million tonnes, with the Prelude FLNG expected to be back in operation after a major overhaul.
About Shell PLC
Shell PLC, headquartered in London, UK, is a global powerhouse in the oil and gas industry, known for its extensive operations in exploration, production, refining, transportation, distribution and marketing, petrochemicals, power generation, and trading.
Shell reported pre-tax impairment charges of US$5.5 billion in the last quarter of 2023. This includes US$2.5 billion from devaluing its Singapore chemicals business and US$1.2 billion from adjustments in oil and gas projects in Nigeria, Britain, and North America.
Shell's operations include a major role in LNG and gas to liquids (GTL) projects, its offerings spanning lubricants, bitumen, liquefied petroleum gas (LPG), and various petrochemical products.
If you are looking for more information about energy companies, their assets, and energy deals, please, contact our sales office mapping@hartenergy.com, Tel. 619-349-4970 or SCHEDULE A DEMO to learn how Rextag can help you leverage energy data for your business.
Talos Energy and Repsol Join Forces in Gulf Exploration JV
alos Energy and Repsol have formed a partnership, each owning 50-50, to reexamine seismic data in a shared area to identify where to drill in the coming years. Tim Duncan, the CEO of Talos, sees this as a strategic use of land they acquired from EnVen Energy Corp to enhance its value. Talos Energy is putting to use the land they bought from EnVen Energy Corp for $1.1 billion. CEO Tim Duncan talked about this on November 7, explaining that it's a smart move because the government has delayed a big decision on new ocean drilling areas. By teaming up with Repsol, Talos plans to work on the land they already have, about 100,000 acres, so they don't have to wait for new permits.
Non-Core Canadian Assets of Murphy Oil Successfully Divested for $104M
Houston-based Murphy Oil Corp. has successfully concluded the divestiture of its non-core operated assets located across its Western Canadian terrain, including the assets in the Kaybob Duvernay region and the complete non-operated Placid Montney position through a subsidiary. The divestiture was initially made public in August and was concluded. The transaction yielded cash proceeds of around US$104 million (CA$141 million), slightly lower than the originally anticipated US$112 million.
EOG Resources is pushing boundaries in Ohio's Utica oil play and now drilling on the Sable pad, also located in Noble County. This site features the 3.7-mile lateral currently under construction. The company's first multi-well pads in the area Timberwolf and Xavier have each produced over 200,000 barrels of oil since their inception—Timberwolf in August and Xavier in October. A third site, the four-well White Rhino pad in Noble County, is also showing promising early results, according to Keith Trasko, EOG’s Senior Vice President of Exploration and Production, who noted the wells are performing as expected in their initial weeks.
Exxon Mobil recently completed its acquisition of Pioneer Natural Resources, a deal worth about $60 billion. This transaction, which is the biggest in shale oil history, significantly changes the competitive landscape in the Permian Basin, a major oil field. This marks Exxon Mobil's largest deal since its $84.4 billion merger with Mobil Corp. in 1999. With this acquisition, Exxon Mobil's production in the Permian Basin will double to 1.3 million barrels of oil equivalent per day.
OXY has been the leader in Permian Basin production for the past five years. Currently, the Houston-based oil and gas company is deepening its presence in the basin with a $12 billion acquisition of CrownRock, adding over 94,000 acres in the Midland Basin and increasing its oil output by about 170,000 barrels per day. Occidental announced an increase in its proved reserves to 4.0 billion barrels of oil equivalent by the end of December 2023, up from 3.8 billion the previous year. Activities in the Permian largely fueled this rise. Occidental added approximately 303 million barrels through infill development projects as well as new discoveries and the further development of existing fields brought in another 153 million barrels.