SHELL PLC
cash flow generation in the quarter.
Total dividends distributed to Royal Dutch Shell plc shareholders in the
quarter were $1.2 billion.
Shell announces a dividend per share growth by around 4% to 16.65 US
cents for the third quarter 2020 and annually thereafter, subject to
Board approval.
Supplementary financial and operational disclosure and a separate press
release for this quarter are available at www.shell.com/investor1.
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ROYAL DUTCH SHELL PLC 3RD QUARTER 2020
UNAUDITED RESULTS
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1. Not incorporated by reference.
Page 4
THIRD QUARTER 2020 PORTFOLIO DEVELOPMENTS
Integrated Gas
During the quarter, the CrossWind consortium, a joint venture between
Shell (79.9% interest) and Eneco (20.1% interest), was awarded the
tender for the subsidy-free offshore wind farm Hollandse Kust (noord) in
the Netherlands. The wind farm has a planned installed capacity of 759
MW and is expected to help meet the objectives of the Dutch Climate
Accord and the EU's Green Deal. Both companies have already taken their
final investment decisions on the project. This investment is part of
Shell's ambition for a new wind-to-hydrogen value chain.
Upstream
During the quarter, Shell completed the sale of its Appalachia shale gas
position in the USA for $541 million paid fully in cash, less closing
adjustments. The transaction has an effective date of January 1, 2020.
In August, Shell took the final investment decision to contract the
Mero-3 floating production, storage and offloading (FPSO) vessel to be
deployed at the Mero field within the offshore Santos Basin in Brazil.
This production system has a daily operational capacity rate of 180,000
barrels of oil equivalent, with production coming online over the next
four years.
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ROYAL DUTCH SHELL PLC 3RD QUARTER 2020
UNAUDITED RESULTS
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PERFORMANCE BY SEGMENT
INTEGRATED GAS
Quarters $ million Nine Months
Q3 2020 Q2 2020 Q3 2019 %(1) 2020 2019 %
(151) (7,959) 2,597 -106 Segment earnings (6,298) 6,731 -194
(920) (8,321) (77) Of which: Identified items (Reference A) (9,572) (237)
768 362 2,674 -71 Adjusted Earnings 3,274 6,968 -53
2,323 2,663 4,224 -45 Cash flow from operating activities 8,972 11,854 -24
Cash flow from operating activities excluding working
2,396 2,871 4,271 -44 capital movements (Reference H) 8,619 10,811 -20
1,020 736 894 Cash capital expenditure (Reference C) 2,638 2,976
143 151 166 -14 Liquids production available for sale (thousand b/d) 152 154 -1
Natural gas production available for sale (million
4,067 4,369 4,586 -11 scf/d) 4,343 4,397 -1
844 904 957 -12 Total production available for sale (thousand boe/d) 901 912 -1
7.80 8.36 8.95 -13 LNG liquefaction volumes (million tonnes) 25.03 26.34 -5
17.13 16.65 18.90 -9 LNG sales volumes (million tonnes) 52.78 54.36 -3
------- --------- ------- -------- --------------------------------------------------------- --------- -------- --------
1. Q3 on Q3 change.
Third quarter segment earnings were a loss of $151 million. This
included an impairment charge of $924 million mainly related to the
Prelude floating LNG operations in Australia. Also included were a
divestment gain of $118 million related to a lease liability
remeasurement and a charge of $126 million related to provisions for an
onerous contract. These charges are part of identified items (see
Reference A).
Compared with the third quarter 2019, Integrated Gas Adjusted Earnings
of $768 million primarily reflected lower realised prices for LNG, oil
and gas and lower contributions from trading and optimisation, partly
offset by lower operating expenses.
Cash flow from operating activities for the quarter was $2,323 million,
primarily driven by Adjusted Earnings before non-cash expenses including
depreciation, as well as cash inflows from commodity derivatives.
Compared with the third quarter 2019, total production decreased by 12%
mainly due to more maintenance activities and lower well performance,
partly offset by the transfer in the first quarter 2020 of the Rashpetco
operations in Egypt from the Upstream segment. LNG liquefaction volumes
decreased mainly as a result of more maintenance activities in
Australia.
Nine Months segment earnings were a loss of $6,298 million. This
included an impairment charge of $9,135 million mainly related to the
Queensland Curtis LNG and Prelude floating LNG operations in Australia.
Also included was a net charge of $450 million due to the fair value
accounting of commodity derivatives. These charges are part of
identified items (see Reference A).
Compared with the first nine months of 2019, Integrated Gas Adjusted
Earnings of $3,274 million primarily reflected lower realised prices for
LNG, oil and gas, lower contributions from trading and optimisation,
higher well write-offs and unfavourable deferred tax movements, partly
offset by lower operating expenses.
Cash flow from operating activities for the first nine months of 2020
was $8,972 million, primarily driven by Adjusted Earnings before
non-cash expenses including depreciation and well write-offs.
Compared with the first nine months of 2019, total production decreased
by 1% mainly due to more maintenance activities and lower well
performance, partly offset by the transfer in the first quarter 2020 of
the Rashpetco operations in Egypt from the Upstream segment. LNG
liquefaction volumes decreased mainly as a result of feedgas
availability, cargo timing and more maintenance activities.
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ROYAL DUTCH SHELL PLC 3RD QUARTER 2020
UNAUDITED RESULTS
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UPSTREAM
Quarters $ million Nine Months
Q3 2020 Q2 2020 Q3 2019 %(1) 2020 2019 %
(1,110) (6,721) 1,651 -167 Segment earnings (8,694) 4,709 -285
(226) (5,209) 818 Of which: Identified items (Reference A) (6,590) 966
(884) (1,512) 833 -206 Adjusted Earnings (2,104) 3,743 -156
2,101 319 4,334 -52 Cash flow from operating activities 8,026 15,090 -47
Cash flow from operating activities excluding working
2,629 548 4,597 -43 capital movements (Reference H) 6,894 15,112 -54
1,245 1,876 2,625 Cash capital expenditure (Reference C) 5,642 7,437
1,520 1,609 1,652 -8 Liquids production available for sale (thousand b/d) 1,619 1,652 -2
3,960 4,673 5,224 -24 Natural gas production available for sale (million 4,768 5,904 -19
scf/d)
2,203 2,415 2,553 -14 Total production available for sale (thousand boe/d) 2,441 2,669 -9
--------- --------- ------- -------- --------------------------------------------------------- --------- -------- --------
1. Q3 on Q3 change.
Third quarter segment earnings amounted to a loss of $1,110 million,
which reflected lower prices as a result of unfavourable macroeconomic
conditions, as well as lower production volumes mainly driven by OPEC+
restrictions and severe weather conditions affecting US Gulf of Mexico
production compared with the third quarter 2019. This was partly offset
by comparatively lower well write-offs. Segment earnings included
impairment charges of $101 million and divestment losses of $100
million. These charges are part of identified items (see Reference A).
Compared with the third quarter 2019, Upstream Adjusted Earnings were a
loss of $884 million, reflecting lower oil and gas prices as a result of
unfavourable macroeconomic conditions, as well as lower production
volumes mainly driven by OPEC+ restrictions and severe weather
conditions affecting US Gulf of Mexico production. This was partly
offset by comparatively lower well write-offs.
Cash flow from operating activities for the quarter was $2,101 million,
primarily driven by Adjusted Earnings before non-cash expenses including
depreciation.
Compared with the third quarter 2019, total production decreased by 14%,
mainly due to the impact of OPEC+ restrictions, lower production in the
NAM joint venture and severe weather conditions in the US Gulf of
Mexico. Divestments and field declines were largely offset by new fields
and ramp-ups.
(MORE TO FOLLOW) Dow Jones Newswires
10-29-20 0315ET
