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Posts on ‘February 7th, 2016’

As Big Oil shrinks, boards plot different paths out of crisis

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Screen Shot 2016-02-07 at 09.14.51* Companies seek to safeguard growth for when market recovers

* U.S. firms abandon deepwater projects for shale oil fields

* Britain’s BP bets on Egyptian gas, Shell on major acquisition

By Ron Bousso and Terry Wade

LONDON/HOUSTON, Feb 7 As oil and gas companies cut ever-deeper into the bone to weather their worst downturn in decades, boards have adopted contrasting strategies to lead them out of the crisis.

Crude prices have tumbled around 70 percent over the past 18 months to around $35 a barrel, leading to five of the world’s top oil companies reporting sharp declines in profits in recent days.

Executives at energy firms face a tough balancing act: they must cut spending to stay financially afloat while preserving the production infrastructure and capacity that will allow them to compete and grow when the market recovers. read more

royaldutchshellplc.com and its sister websites royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, shellnews.net, shell2004.com, shellshareholders.org, don-marketing.com and cybergriping.com are all owned by John Donovan. There is also a Wikipedia article: royaldutchshellplc.com

Royal Dutch Shell plc and BG Group plc merger

Screen Shot 2016-02-06 at 08.47.20By Brett Owens: Forbes.com: 6 Feb 2016

The Royal Dutch Shell plc ADR (RDS.A) and BG Group plc ADR (BRGYY) merger, which looked liked such a win-win for everyone has grown a bit complicated as the deal nears completion. The premium has shrunk, as have the benefits of the merger with prices under $90 a barrel.

However, there are still some takeaways for investors to breathe easier about. First, Shell has never cut or suspended its dividend in 40 years. That includes the late 1980s when oil was at $10. And despite a 56% drop in fourth quarter profits, the firm has reiterated it will maintain its dividend for 2016.

The firm has delayed capital expenditures and cut spending. It plans to slash another 3% of its employees this year after the merger.

The Shell BG merger increases Shell’s reserves by 25% and its output by 20%. More importantly, it makes Shell a well positioned producer of LNG – a segment that is growing internationally as oil declines. The merger takes Shell from third to the second largest public oil producer by capitalization after Exxon. read more

royaldutchshellplc.com and its sister websites royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, shellnews.net, shell2004.com, shellshareholders.org, don-marketing.com and cybergriping.com are all owned by John Donovan. There is also a Wikipedia article: royaldutchshellplc.com
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