Oil major Royal Dutch Shell posted a 44 percent drop in earnings for the fourth quarter of 2016 compared to the year-before period.
The company on Thursday reported its fourth quarter 2016 CCS earnings attributable to shareholders of $1.03 billion, 44% lower than for the same quarter a year ago and earnings of $1.8 billion.
Full year 2016 CCS earnings attributable to shareholders were $3.5 billion, an 8% decrease compared with $3.8 billion in 2015.
On a CCS basis, Shell’s 4Q 2016 earnings, excluding identified items, were $1.8bn, up 14% from $1.6bn for the fourth quarter of 2015.
Compared with the fourth quarter 2015, CCS earnings attributable to shareholders excluding identified items benefited from higher contributions from Upstream and Chemicals, partly offset by lower contributions from Refining & Trading. Operating expenses were lower, more than offsetting the impact of the consolidation of BG. Depreciation and net interest expense increased, mainly resulting from the BG acquisition. Earnings also reflected higher taxation.
The company’s revenues increased during the quarter amounting to $64.8 billion, compared to $58.1 billion in the fourth quarter of 2015.
Shell CEO, Ben van Beurden, commented: “We are reshaping Shell and delivered a good cash flow performance this quarter with over $9 billion in cash flow from operations. Debt has been reduced and, for the second consecutive quarter, free cash flow more than covered our cash dividend.
He also added: “Looking ahead, we will further focus the portfolio and strengthen the company’s financial framework in 2017. Our strategy is starting to pay off and in 2017 we will be investing around $25 billion in high quality, resilient projects.”
Capital investment for the fourth quarter 2016 was $6.9 billion. Full year 2016 organic capital investment was $26.9 billion while capital investment in 2017 is expected to be around $25 billion.
Oil and gas production for the fourth quarter 2016 was 3,905 thousand boe/d, an increase of 28% compared with the fourth quarter 2015.