The Hague-based LNG giant Shell reported a nearly 50 percent drop in profit for the fourth quarter of 2019 on lower realized oil, gas and LNG prices.
The company reported a net profit of $2.9 billion for the quarter under review, 48 percent down on the $5.6 billion reported in the corresponding quarter of 2018.
The company’s profit for the year 2019 was 23 percent down on the previous year, reaching $16.4 billion, Shell said in its quarterly report.
The fourth-quarter earnings reflected lower realized oil, gas and LNG prices, weaker realized refining and chemicals margins as well as negative movements in deferred tax positions, compared with the fourth quarter of 2018.
Fourth-quarter Integrated Gas Earnings slipped 47 percent for the quarter under review, compared to the corresponding quarter in 2018.
Compared with the fourth quarter of 2018, Integrated Gas earnings excluding identified items primarily reflected lower realized LNG, oil and gas prices as well as higher operating expenses and depreciation, partly offset by stronger contributions from LNG, gas and power trading and optimization. The segment reported earnings of $1.9 billion which compares to $2.3 billion in the fourth quarter of 2018.
Compared with the fourth quarter of 2018, total production decreased mainly due to the transfer of the Salym asset into the Upstream segment and divestments, largely offset by field ramp-ups in Australia and Trinidad and Tobago.
LNG liquefaction volumes increased mainly as a result of additional capacity from the Prelude floating LNG facility and the Elba LNG facility compared with the fourth quarter of 2018.
Volumes reached 9.21 million tonnes in the quarter under review, which compares to 8.78 million tons in the fourth quarter of 2018.
LNG sales volumes have jumped 16 percent, reaching 20.09 million tonnes, compared to 17.39 million tonnes in the fourth quarter of 2018.
Shell’s LNG volumes for 2019 reached 35.55 million tonnes, 4 percent above the 34.32 million tonnes reported in 2018. LNG sales volumes for 2019 reached 74.45 million tonnes, 5 percent above the 71.21 million tonnes reported in 2018.