Shell on Thursday said reduced maintenance would boost its upstream oil and gas production in the current quarter both against year-ago levels and the third quarter 2018, after some slippage in the third quarter.
In a results statement Shell said its overall oil and gas output had fallen by 2% on the year in Q3 to 3.60 million b/d of oil equivalent, with production from its integrated gas unit falling 8% to 924,000 boe/d, and upstream liquids production falling 1%, to 1.60 million b/d. It said maintenance was the main reason for the plunge in the integrated gas unit, which is responsible for the company's LNG business.
Lower maintenance and growth from new fields should result in the company's upstream oil and gas production being 80,000-120,000 boe/d higher in Q4 compared with a year earlier, when it was 2.78 million boe/d, it said.
Like its peers Shell reported improved quarterly cash flows and profits on the back of higher oil prices in the third quarter, alongside a reduced downstream result, slightly reducing its debt and somewhat boosting its still-lackluster return on average capital employed. It announced a second tranche of share buy-backs worth $2.5 billion.
Its cash flow from operating activities was up 59% on the year at $12.09 billion and its profit after adjusting for oil inventories was up 51% at $5.57 billion.
Its adjusted upstream earnings more than tripled to $1.89 billion, but were outstripped by integrated gas earnings of $2.29 billion, while downstream earnings were down 25% at $2.01 billion, with a particularly steep reduction in refining and trading.
Return on average capital employed rose from 8.1% in Q2 to 8.7% in Q3, while gearing at the end of the quarter was 23.1%, down from 23.6% at the end of the second quarter.
