Shell Expects Boost in Q3 Earnings from Gas and Chemical Trading

Shell, the British energy giant, anticipates that its third-quarter earnings will be bolstered by stronger gas and chemical trading, while its production volumes remain on track to meet targets.

Production Volumes

For the third quarter, Shell expects to report production of 880,000-920,000 oil-equivalent barrels a day of integrated gas, which aligns with its guided range of 870,000-930,000 BOE a day. However, this is a decrease from 924,000 BOE a day in the same quarter of 2022.

In terms of liquefied natural gas (LNG), third-quarter volumes are expected to have declined to 6.6 million-7.0 million metric tons compared to 7.24 million tons in the previous year. This adjustment updates Shell's previous expectations of 6.3 million-6.9 million tons.

Corporate Performance

Shell predicts an adjusted loss range of approximately $400 million to $600 million on the corporate side for the third quarter. This is an improvement from the corporate adjusted loss of $654 million in the second quarter.

Factors Affecting Production Outlook

The expected production levels for integrated gas and LNG liquefaction reflect scheduled maintenance work, which includes assets like Prelude and Trinidad and Tobago.

Trading Outlook

Shell anticipates higher trading volumes for both integrated gas trading and chemicals and products trading in the third quarter. This projection follows a recent rally in oil, refined products, and gas prices across the industry, which is expected to have a positive impact on the quarterly earnings of integrated energy companies.

Marketing Results

Overall marketing results from trading oil and other products are projected to remain relatively unchanged compared to the previous year. Sales volumes guidance for the third quarter is now slightly narrowed down to 2.45 million-2.85 million BOE a day, compared to the earlier range of 2.45 million-2.95 million BOE a day.

Upstream Production

Upstream production is expected to meet the upper levels of the previously guided range of 1.6 million-1.8 million BOE a day. The current forecast is at 1.7 million-1.8 million BOE a day, compared to 1.79 million BOE a day during the same period last year.

Publication of Third-Quarter Results

Shell's third-quarter results are scheduled to be published on November 2.