Shell: warns about gas productionin Q4

(CercleFinance.com) - Shell said on Wednesday that it expected gas production to be lower than initially forecast in Q4, an announcement that weighed on its share price on the London Stock Exchange in early trading.


In a trading update, the Anglo-Dutch giant said it was now expecting liquefied natural gas (LNG) production of between 6.8m and 7.2m tonnes in the last three months of the year.

It had previously been targeting a figure of between 6.9m and 7.5m.

Regarding its upstream activities, Shell has tightened its production guidance for Q4, now expected between 1.79m and 1.89m boe per day, compared with a previous target of 1.75m-1.95m.

Concerning its commercial performance in chemicals, the energy group says it expects an indicative refining margin of $138 per tonne, compared with $164 per tonne in Q3.

This update seems insufficient in view of current market estimates, RBC analysts reacted.

We expect it to lead to a downward revision of consensus forecasts, the Canadian broker continued.

Shell also warned that it would record a cash outflow of around $1.3bn in its Q4 accounts, linked to the payment of emission certificates under the German CO2 tax and the US biofuels program.

Following these announcements, Shell's share price fell by 1.4% on Wednesday morning, making it one of the biggest decliners on the FTSE 100 index.

The group is due to publish its Q4 results on 30 January.


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